In much the same way as seeds thrown onto a rocky hillside would not take root, a strategy being implemented in an inhospitable environment is unlikely to succeed. This inhospitable environment can be the result of confusion caused by the failure to align the operational elements of the environment. Operational elements such as Structure, Systems, Processes and Culture are the things that facilitate work getting done in an organization.
Consider a strategy that requires collaboration across business groups to achieve its desired outcome. To implement that strategy in an environment that rewards individual achievement will result in failure. To be successful with this strategy the organization will need to realign the reward system to drive the desired behavior. Individuals will not operate in a new way if they are still being rewarded for the old way.
This is often the driver for an organization to embark on a culture change. Culture is simply a collection of individual behaviors which reinforce the unwritten rules of the organization and become “the way things work around here”. When an organization makes a radical shift in strategy, often a culture change is required to execute that strategy.
Take for example, an organization that historically focused on a strategy of operational excellence. In that environment, low cost and efficient processes are the measures of success. The structure of the organization would be fairly hierarchical to drive compliance to very rigid processes and the systems set up to support this would reward compliance, adherence, low error rates and cost savings. The type of employee sought for this culture would be compliant, diligent, efficiency-focused and somewhat risk adverse.
Now, imagine that same organization has decided that to remain competitive that they must embrace a strategy of innovation. They don’t want to be known as the low cost leader but instead be known as a cutting edge innovator. Consider the changes that must be made to align current operational elements such as structure, systems, processes and overall culture with the desired outcome of the strategy. To achieve innovation, risk-taking must be rewarded and processes must become less rigid. New measures of success must be identified, new behaviors defined and a new employee profile must be developed to ensure the type of employee selected is in alignment with the organization’s direction.
At ROI, we’ve helped many organizations review and align their Systems, Structure, Processes and Culture to support their strategy and deliver the desired business results.