“If you don’t understand the culture of the company, even your most brilliant strategies will fail. Your vision will be resisted, plans won’t get executed properly, and all kinds of things will start going wrong.”
Isadore Sharp, Founder & Chairman, Four Seasons Hotels
Let’s face it: on the list of important activities for an organizational leader, Culture usually ranks fairly low. And that’s a huge problem.
Most leaders will talk about Culture, and they often cite it as a reason for their success…or lack thereof. But in my experience, very few are active and intentional when it comes to building and maintaining their Culture. They rarely make Culture as important as sales, production, quality, or profitability.
Why should Culture be just as important? Here are four crucial reasons:
- Your Culture is your Competitive Advantage…or Disadvantage.
Your organization’s personality—how you show up in the world—can make a big difference in the marketplace. We measure ROI, but what about ROC—Return on Culture? Things like repeat business, confidence in your workforce, costs, time, quality…all are measures of ROC.
You’re going to get a return on your Culture; the only question is will it be positive or negative?
- Your Culture is your Differentiator.
Every organization wants to differentiate itself and its offering for customers. Culture is one of the best differentiators because it is unique. Competitors can copy your offerings, equipment, and processes, but they can’t play “me too” with your Culture.
How your people interact with customers, how they accomplish the work, and how they innovate is in large part a function of your Culture. Plus, a good Culture helps you attract and retain the best people.
- Culture eats Strategy for lunch every time.
A significant body of research shows conclusively that Culture is the single most important factor in determining whether or not a strategy is successfully executed and performance goals achieved.
In short, it doesn’t matter how wonderful your organization’s strategy is. If your Culture doesn’t support it, the strategy will fail.
- Your Culture is always at risk.
Every interaction—with customers, with the marketplace, with new employees—has an effect on your Culture. And if you don’t pay attention to it, the effects are often negative.
In good times and bad, your Culture has to be actively nurtured. Growth can dilute the Culture, creating “thermal layers” that the culture doesn’t cross, and causing disconnects with new hires. Downturns can challenge employees’ beliefs in your values and leaders.
For these reasons, it’s crucial that any organization that seeks success requires a solid, effective Culture in which everyone shares, maintains, and strengthens The 4 C’s:
- Clear Vision: everyone understands what the desired Culture looks like
- Consistent Values: what’s important is always important
- Conscious Choices: people make decisions based on the Values
- Candid Conversations: people feel free to speak openly and honestly
When the 4 C’s are in place, you won’t just have a competitive advantage, you’ll have competitive immunity.
And that’s why Culture matters.