Who Killed The Corporate Culture?
“Culture eats strategy for breakfast, operational excellence for lunch and everything else for dinner,” says an internet meme, sparked by a quote attributed to legendary management thinker Peter Drucker. While Drucker’s views on modern business corporations shaped management philosophy of the 1980s and ‘90s, the reference points to corporations’ seminal focus of culture even today. This is especially relevant in a post-pandemic world, where the concept of tomorrow’s hybrid workplaces is constantly evolving.
While the role of culture within organizations has been changing over the last decade, it has transformed in the past year as most organizations were forced to adapt to a new normal almost instantly. There has never been a more opportune moment for organizations to ask themselves three questions: What is culture? What shapes organizational culture? Is culture overamplified?
Let’s look at how corporate culture is being continually being shaped in today’s enterprises of the future.
What is culture?
In their book Culture Eats Strategy for Lunch, inspired by the Peter Drucker quote I discussed above, authors Curt Coffman and Kathie Sorensen have an interesting insight into corporate culture. They write that while 80% of the factors that shape a corporation’s culture are generic, there always remains 20% of elements that are unique. It is this 20% that molds an organization’s distinctive corporate culture.
While views on such definitions of culture may differ, culture remains most commonly viewed as a shared set of values that define a corporation. It is a common code of conduct that creates a common corporate culture internally, which in turn builds a common perception of how the brand is perceived externally.
Take Apple’s fabled reputation for intuitive, easy-to-use products. This was built into the DNA of the company through a code of values that emphasized simplicity and innovation in design. As far back as 1977, the company’s first marketing brochure ran with the slogan “Simplicity is the ultimate sophistication.” These values were so ingrained into the company that they survived Steve Jobs’ passing and have now become synonymous with the company. Even today, more than four decades later, any mention of Apple is accompanied by a reference to its ethos of innovation and the simplicity of its product design, which are an integral part of Apple’s corporate culture. That fashions the experience of both internal and external stakeholders.
What shapes organizational culture?
But this is not a one-way interaction in which corporations act on and impact stakeholders. In fact, the interests of different stakeholders, such as investors, employees and customers, are also continuously shaping organizational culture. A high focus on any specific group could potentially create a skewed organizational culture. In the case of Apple, the company’s famed customer-centricity was balanced by innovative career paths for its employees. There were also significant rewards for investors as Apple emerged as the most valuable company in the world. In this way, great organizations evolve a common culture that creates memorable experiences and an empowering value system for all stakeholders.
Take Jack Welch’s scorching path to transformational growth for General Electric in the 1980s and 1990s. While this had gains for investors and customers, it also had to create a rewarding experience for high-performance employees. Jack Welch famously said of the role of people in the new framework for GE’s work culture he had created, “No company, small or large, can win over the long run without energized employees who believe in the mission and understand how to achieve it.”
It is such a common corporate culture, based on the values of insatiable curiosity and smart business disruption, which binds the 40 companies of the Virgin Group across five business sectors in five continents. The external manifestation of this is seen in pioneering events such as Virgin Galactic’s first fully crewed spaceflight, connecting all businesses and stakeholders. The group’s internal culture also ensures that it constantly remains relevant and stays ahead in its many industries. “Create the kind of workplace and company culture that will attract great talent. If you hire brilliant people, they will make work feel more like play,” explains Richard Branson on the common code of values that bring together the multiple interests of his many diverse business groups.
Is culture overamplified?
As remote workforces increasingly became the norm during the pandemic, it also raised questions on how corporate culture would evolve. Was the idea of a homogeneous corporate culture still relevant? Had culture been overamplified? Several studies undertaken amidst the pandemic indicated this might not be the case. If anything, the search for a common corporate culture seemed to be stronger in a remote workforce that was disconnected from its everyday workplaces.
According to PWC’s “Global Culture Survey 2021,” culture emerged as a source of strength for corporations during the pandemic. Now 67% of these organizations said culture was an important topic for leadership, as compared to only 61% in 2018. Significantly, 81% viewed culture as a competitive advantage. While 48% thought it had a positive correlation to revenue, 80% believed it would increase employee satisfaction, and 89% said it would raise customer satisfaction.
Clearly, if corporate culture as we knew it is dead, the need for a common ethos that links together diverse stakeholders in remote workspaces is stronger than ever before. Empowering workplace cultures will have to find the right balance between all these diverse groups of stakeholders.
Corporate culture as we knew it is dead. Long live corporate culture!