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Four quick fixes to prevent culture sabotaging your strategy

Over the years Palladium has helped many organisations better align their culture and strategy to achieve the financial and social results they’re striving for. Used wisely, intangible assets like culture provide a powerful competitive advantage, particularly in the new world of the Impact Economy. Increasingly, organisations must formulate strategies and implement solutions that deliver enduring social and economic benefit. In this blog, we share the four most common culture-bound mistakes made by organisations when it comes to strategy execution, and how to fix them.

One of the most common mistakes organisations make is trying to launch strategic projects that don’t align with their culture. Credit: http://ow.ly/TxKa309C9P3

While it is widely accepted that culture must be supportive of strategy, many companies still struggle to create the right ethos amongst employees. Increasingly, if organisations are to create enduring economic and social value, culture and business strategy must go hand in hand. If you want a new approach that improves your results, you have to be serious about changing behaviours. It’s time to take an honest look at your strategy and ask: “is our culture supporting our strategy in today’s world?”

Fix mistake #1: Pushing a strategy that conflicts with your culture
One of the most common mistakes organisations make is trying to launch strategic projects that don’t align with their culture. First, be honest about what constitutes your true company culture – not what’s slapped on the wall in a poster, but how people behave every day. If your culture must change in order to implement strategy successfully, gather the leadership team to share a united message to your organisation.

For example, your organisation may have always focused on financial goals, but for the first time you’re looking at how you can deliver Positive Impact - the intentional creation and measurement of enduring social and economic value. To shift culture in the right direction, you’ll need to bring people on board. In today’s Impact Economy, consumers are increasingly demanding this change. Encouraging your employees to consciously think about the company’s strategy and culture is a powerful way to inspire change.

Fix mistake #2: Treating culture as a HR problem
The most fundamental resource in an Impact-Focused Organisation is its people. While culture can be managed and even transformed, it shouldn’t be treated as a “check-the-box” exercise. Often leadership will inform HR of a new change management framework (or direction) and walk away. While it’s important to pursue culture in partnership with HR, all other areas in the organisation should be on board to guarantee that new business principles are absorbed into the operational and social personality of an organisation – ensuring culture is constantly managed alongside strategy.

List the top ten things that come to mind when you think about your culture. Is it collaborative? Innovative? Competitive? Now circle the three elements that you consider essential to your strategy. Ensure these aspects are constantly communicated and celebrated throughout your organisation. Culture is more than your organisation’s values – it’s the way individuals behave and interact and deserves as much attention as your strategy.

Fix mistake #3: Building a risky strategy for a risk-averse organisation
How willing is your company to take risks? Understanding tolerance for risk is critical to executing your strategy effectively. When leadership teams in risk-averse organisations roll-out a drastically different vision for the future, it can be demotivating (and terrifying) for employees.

Assess your organisation’s appetite for risk. Are the risks worth taking? If so, create a communications plan that presents an urgent reason why the organisation should change. For people to take up a new challenge, they need to understand the potential impacts and upsides involved.

Fix mistake #4: A lack of employee empowerment
When you execute your strategy, it’s important to consider your teams’ ability to make decisions and drive change. In many cases, executives may find it hard to let go, even if they’ve assigned a project manager for strategic initiatives. Individuals and project teams need to be clear about their responsibilities and decision making abilities.

For example, in 2008 when Delta acquired Northwest to create the world’s largest carrier, CEO Richard Anderson recognised the importance of empowering his employees. He nominated a separate president to independently manage deals.

“The president and I carry the same cachet,” Anderson told Harvard Business Review, “so we can get twice as much done. He can go run the Virgin Atlantic transaction while I’m in China trying to work a deal with our two Chinese partners.” Map out the decision rights for each role. Clarify roles and ownership, match responsibility with seniority, and ensure everyone is on the same page. Make sure you’ve empowered your people with the right tools and culture to execute their roles.

Final thoughts
Taking the first step to intentionally manage your culture alongside your strategy can be difficult, but it will lead to better results and happier employees. If you want a strategy that improves your economic and social performance, you have to be serious about changing behaviours: often those embedded deep in your culture. Getting people to change is hard, but not impossible. As the world moves rapidly into the Impact Economy, it will be those companies driving innovative change with their culture and strategy who will be most successful.

For more information about our strategy execution services visit our strategy capabilities page or email Caleb Powers (Caleb.Powers@thepalladiumgroup.com).