The Importance of the Strategy and Culture Mix.

A good mix between strategy and culture is vital to a company’s success when implementing new strategies for a company. If they conflict, research shows that failure rates are high.

Strategies that conflict with strong cultures are likely to experience resistance. A company’s culture is its identity. It states who they are and what they do. “Because an organizations culture can exert a powerful influence on the behavior of all employees, it can strongly affect a company’s ability to shift its strategic direction. A problem for a strong culture is that a change in mission, objectives, strategies, or policies is not likely to be successful if it is in opposition to the accepted culture of a company.” (Hunger and Wheelen. 2008. pg. 248).

However, in the case of a weak culture, strategic changes may be welcome, even if they change the current culture. This was the case when Maytag purchased Admiral, formerly known as Magic Chef. Admiral employees, out of respect for Maytag’s success and leadership in quality, gladly accepted a new culture, based on a strategy they anticipated would develop success for their future.

“An optimal culture is one that best supports the mission and strategy of the company of which it is a part. This means that, like structure and staffing, corporate culture should support the strategy. Unless strategy is in complete agreement with the culture, any significant change in strategy should be followed by a modification on the organization’s culture.” (Hunger and Wheelen. 2008. pg. 248).

Therefore, strategy must fit with culture to be successful for a company. However, to succeed in a competitive market, companies must develop strategies that align a company with success. Properly formulated and implemented strategies result in success within an industry. A company’s culture does not drive this success. It definitely can play a significant role in the ultimate achievement of desired results and the effort, timing and implementation of strategies. Culture does not provide a “roadmap” for a company’s planning to success. It is a considerable factor in the planning implementation, but a company’s ability to reach its goals is a result of the direction provided through strategy.

As such, the strategy-culture compatibility assessment is based on strategy as the dominant driving factor. However, this may vary in different unique situations. The ultimate goal of the compatibility assessment is to evaluate the current correlation between the company culture and the affects of implementing a new strategy. If a possible conflict occurs, it can be addressed in a manner that evaluates possible ways to gradually evolve the culture to match the new strategy. Since strategy is the driving force of a company’s efforts, the assessment also focuses on the current culture effect on its outcome. The assessment can prove that if a culture is too strong, a new strategy may not work. As a result, in some circumstances, culture may actually shape a strategy.

In most circumstances, culture can be gradually adjusted to mesh with a new strategy. It is management’s responsibility to evaluate this connection and try to develop a new strategy that is most inline with the current culture. However, the strategy remains the driving factor in a company’s effort to reach its goal. Only after all attempts to adjust culture have been determined unobtainable, should a company decide to change its strategy.

In evaluating the effects of culture on new strategies, management should follow a process of evaluation based on the strategy-culture compatibility assessment. They should first consider if the planned strategy is compatible with the company culture. If it is, the new strategy is likely to be accepted by the workforce. If they are not inline with each other, management must determine if the culture can be easily modified to make it more compatible with the new strategy.

Once a company determines that the culture can be easily modified to make it more compatible with the new strategy, management must proceed with caution, introducing new culture characteristics. This can be achieved through modifying structures, training and development and establishing new management personnel compatible with the new strategy. If management determines that the culture can not be easily modified consistent with the new strategy, they need to determine if they are willing to make organizational changes, accept delays and increases in cost associated with the new strategy that conflicts with the current culture.

If these factors are acceptable to management, they can implement the new strategy working around the culture. They will need to develop and implement a new organizational structure to move forward with the new strategy. If they are unwilling to accept these factors, they must evaluate their commitment to the new strategy. If they are still convinced that implementing the new strategy is the correct course of action, they should consider finding a “joint venture partner or contract with another company to carry out the new strategy.” (Hunger and Wheelen. 2008. pg. 250). Once management has determined that they are not committed to the new strategy due to the challenges it faces within the culture, they should find a different strategy.

Since numerous efforts are made to modify the culture to work with the strategy, one would conclude that culture follows strategy according to the strategy-culture compatibility assessment.

References
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Hunger, David J. & Wheelen, Thomas L. (2008). Concepts on Strategic Management and Business Policy. New Jersey: Pearson Prentice Hall.