Why Does Culture 'Eat Strategy For

Breakfast'?

Jacob M. Engel
Forbes Councils Member
Forbes Coaches Council
COUNCIL POST| Membership (Fee-Based)
Leadership
POST WRITTEN BY

Jacob Engel
CEO and Author of The Prosperous Leader. I help CEOs and their organizations
prosper. www.theprosperousleader.com


Getty
GETTY

Peter Drucker was famous for this alleged quote: "Culture eats strategy
for breakfast." In working with many entrepreneurs, I have found this
to be very true, as the culture is the secret sauce that keeps employees
motivated and clients happy. In fact, I recently read a great quote that
said, "People do not just quit companies or leaders … they quit
organizational cultures."

I’d like to share with you two stories of clients for whom culture was
the dominant factor in whether they were successful in taking the
business to the next level or are still treading water.
Nathan founded a family-owned security services business over 30
years ago, and today, he has his brothers and some of their wives in the
business. His success is in the very prestigious clientele that trust him
for his services.

From the get-go, I was impressed by his entire company having this
unbelievable can-do attitude. Every curveball thrown at them was an
opportunity for growth. The leadership displayed a unique blend of
humility and confidence. Integrity was a real goal in everything they
did.

The best story I remember was when the head of security at one of their
largest customers was moving to another large company that they
weren’t doing business with. Quite frankly, they were somewhat happy
that he was moving, as he was a real stickler for details, and keeping
him happy was a huge effort.

A few days after he moved to the new company, he called Nathan and
said, "I know I was tough on you guys, but you’re the best out there.
Can you help me at my new company?"

Their culture statement was very impressive, and what I found was that
they really meant every word. Here are some highlights:

• Their core values were first and foremost based on the principles they
lived by.

• They believed in making a difference for their clients and their

employees.

• They really cared about each other, about their customers and about
empowering everyone to do their best.
• They believed in working together and strived for feedback,
collaboration and diversity.

• They reached for the stars and weren't afraid to fail, as if you fail, at
least you will land on the moon.

"At Security Systems, we innovate, we test -- and we learn along the

way."

What is unique is that they took their culture very seriously, including
everyone from the leadership down. It wasn’t empty talk or something
nice on the wall. They knew that the company’s culture was the secret
sauce behind their success, and they religiously followed it.

Contrast this with another client, Charles (not his real name), who
from the onset insisted that processes are the answer to the challenge
of their people not taking ownership and what I call "confusing efforts
for results."

His company had millions of dollars outstanding that nobody bothered

to chase down. There was constant infighting, and few took
responsibility. While they tried to change things, they made the typical
mistake of throwing bodies and systems at the problem.

Truth be told, the ownership also tried hard to change the culture, but
culture starts at the top, and as long as the leaders were finding excuses
for nonperformance, everyone else did the same. Charles had a very
hard time holding people accountable, and his people knew it.

He and his staff all came up through the ranks and had never run such
a high-growth company. They were mostly homegrown executives with
golden handcuffs. While they brought some outsiders into leadership
roles, the culture that was prevalent was one of the old regime -- not
the new executives -- and the jury is still out as to whether it will work
or will frustrate them to the point where they leave.

So, what are some of the lessons learned that entrepreneurs, especially,
need to be very careful about?

1. Culture is created by the behaviors you tolerate. If you will

tolerate bad behavior, people will learn they can get away with it. That
doesn’t mean you have to be mean about it, but create a culture of
"open and honest" feedback, and make sure it goes both ways.

2. Change starts at the top. Often, the leader will not be open to
change, and it can be in their body language or becoming defensive
when someone disagrees with them, etc. You can’t expect your people
to change if you’re not willing to change first.

3. The leader needs to recognizes that they are ‘a voice’

around the table, not ‘the voice.’ This is a huge challenge, as
leaders often see themselves as the only person capable and authorized
to make decisions. While it’s true that they need to make the decisions,
they also need to listen honestly and without showing impatience for
other people’s opinions. Some call it the obligation to dissent, but
whatever you call it, make sure people feel validated for their opinions,
and when you make a decision, take those opinions into account.

Culture is one of those intangibles that is very hard to define but needs
to be designed and implemented -- and never by default.

Forbes Coaches Council is an invitation-only community for leading

business and career coaches. Do I qualify?
How and Why
Organizational Culture
Eats Strategy for
Breakfast, Lunch, and
Dinner
Maintaining cultural coherence across a companies
portfolio should be an essential factor when
determining a corporate strategy.
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February 27, 2020 · By Torben Rick

Strategy or Culture: Which is More Important?

“Culture eats strategy for breakfast”, a phrase originated by Peter
Drucker and made famous by Mark Fields, President at Ford, is
an absolute reality!
Any company disconnecting the two are putting their success at
risk.
However, while many studies show there is a direct correlation
between a healthy, productive culture and a company’s bottom
line, the majority of companies spend little time thinking, let alone
doing anything about, this topic – even when they’re spending lots
of time thinking about their business strategy.
Organizational culture eats strategy for breakfast, lunch and dinner so
don’t leave it unattended.

Strategy, Capabilities, and Culture Need to be Aligned

 There is a powerful triumvirate in corporate transformations –
Strategy, capabilities, and culture. All three need to be designed
together, aligned and enabling of each other to create true
organizational transformation.
Strategy, capabilities and culture leadership is about a series of
related choices about “where we going to play”, “how are we
going to win and differentiate”, “what capabilities need to be in
place to execute”, “what are the cultural imperatives to enable
differentiation and execution”?
Given strategy is typically viewed from a 3-5 year time horizon
and refreshed every few years, capabilities and culture also need
to be reviewed at the same time and as one process.
This does not mean changing the values of the company, it
means in the context of the strategy, business model, brand
positioning … what capabilities are required and what are the
critical few cultural capabilities required to enable and drive
success?

How to Cultivate Organizational Culture?

Corporate culture is a hard thing to get right. It’s a moving target
that means something different to everyone. It grows and evolves
over time and is the result of action and reaction. It is the lingering
effect of every interaction. How to cultivate organizational culture?

Don’t Forget Culture when Drafting Corporate Strategies

Culture change is complex and most efforts fail to meet
expectations. This is in part because it is often approached
separately from strategy and capabilities and becomes an “HR
Thing”, and/or it is approached too broadly.
Culture eats strategy for breakfast … you can’t get any stronger
message than that … unfortunately, a message that is all too
often forgotten when drafting corporate strategies.
The thing I have learned at IBM is that culture is everything – Louis V.
Gerstner, Jr. former CEO IBM
Strategy or Culture
Maintaining cultural coherence across a companies portfolio
should be an essential factor when determining a corporate
strategy.
No culture, however strong, can overcome poor choices when it
comes to corporate strategy.
The impact of culture on a companies success is only as good as
its strategy is sound.
Don’t let culture eat strategy for breakfast. Have them feed each
other.
About the Author
Torben Rick - Experienced senior executive, both at a strategic
and operational level, with a strong track record in developing,
driving and managing business improvement and development
and change management. International experience from
management positions in Denmark, Germany, and Switzerland.
 If culture eats strategy for breakfast,
what’s left for lunch?
CATEGORIES
Organisation Design
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 Transformation
 Leadership & Culture
 Change Management
 Special features
 Case Studies
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‘Culture eats strategy for breakfast,’ said the American consultant,
Peter Drucker memorably.

It’s a good line.

But what does it mean in reality?

Strategy and culture need to work together and mutually support each
other. If they are disjointed, success will suffer.

Typically, strategy is the principal focus in organisations – and rightly

so. It’s vital to have a clear future direction.

But company culture often gets left behind, despite studies showing
that culture has a direct impact on performance and customer
satisfaction. In fact, companies that are culture-conscious outperform
industry benchmarks and their competition 1.

When you think about a business that inspires

you, what springs to mind?
Is it their culture or their strategy that stands out?

Often, what makes a business unique is their culture. Take Starbucks, for example. The
company differentiates itself from competitors not by its strategy (which is similar to
many other coffee chains) but through its culture.

And culture drives customer and employee loyalty. It is a company’s unique culture that
helps to attract and retain the best talent.

If the people are passionate about the company they work for (and its values), then they
are more likely to strive for the company strategy. The culture will influence their
everyday behaviours and actions.
With such undeniable benefits, every organisation needs to focus on its culture as well
as its strategy. But how?

First of all, let’s be clear – culture is more than values and vision alone.

It is about describing the behaviour norms in an organisation. It’s not merely about what
the leader might espouse on culture. It is deeper than that. Culture needs to be
considered in every part of an organisation.

Here are our four recommendations for bringing about culture change and ensuring your
strategy and culture are aligned.

1) Understand your culture

What is your culture now? The day-to-day reality may be very different
from the values written on the office wall. To be able to change your
culture, you first need to understand it.

Carrying out an anonymous survey of your people is a good way to

find out their experiences and what they would like to change in the
future.

It is also vital to consider ‘climate’ – how it feels to work in the

organisation.

Culture and climate can sometimes be at odds. For example, you

could be very well rewarded financially, and so you feel superficially
valued (culture).

But, if the organisation has a forced ranking system that exits 10% of
‘underperformers’ every year, that feeling of being valued is, at best,
temporary (climate).

Culture and climate in that situation can be working against each other.
It is crucial to consider both in any review of culture.

2) Encourage conversations
In addition to a survey, we recommend setting up workshops and one-
to-one interviews for your people to speak frankly in a safe
environment and to collaborate on ideas to improve the culture.

We recommend that an external party leads these conversations, with

specialists in employee consultation and engagement, to ensure a
highly sensitive and objective approach. Working closely with your HR
team and leaders, they will gather feedback from your people at all
levels and departments. From this, they would highlight key findings
and recommendations.

As an example, consider the approach we took on the BBC Respect at

Work Review. As a result of this work, BBC employers were able to
see positive changes happening.

3) Map your values and purpose

What are your values and purpose?

With your strategy front of mind throughout this process, the next step
is to imagine how you want your culture to be.

And purpose is an essential part of this. Purpose is what helps to unite

people – remember the old fable of the NASA cleaner who said her
purpose was to put a man on the moon?

Once you have your clear values and purpose, go back to the findings
of your surveys, workshops and interviews. What works and should be
encouraged? What are the weaknesses? Where are there
misalignments with your purpose?

Then develop an action plan to address the key issues.

4) Celebrate success
As you put in place the changes or new focus on your culture, you will
see the most significant impact by being transparent in communicating
to your people on the findings, the action plan, and involving them
throughout the journey.

To get their support and buy-in, celebrate success whenever you see
the impact of the changes.

Culture is critical to the success of an organisation. Strategy and

culture need to be aligned and to achieve this balance, you need to
dedicate time to focusing on your culture, understanding how it is today
and making changes on an ongoing basis.

The behaviours you see will then match the behaviours and purpose to
which you aspire.

References
1 https://www.forbes.com/sites/williamcraig/2017/11/21/8-ways-your-
company-culture-directly-impacts-your-bottom-line/#36d15ab267f0

Reading list

https://www.forbes.com/sites/shephyken/2015/12/05/drucker-said-
culture-eats-strategy-for-breakfast-and-enterprise-rent-a-car-proves-
it/#2880b92a2749

https://www.managementcentre.co.uk/culture-eats-strategy-for-
breakfast/

https://www.smestrategy.net/blog/what-does-culture-eats-strategy-
mean-for-you-and-your-organization

https://techcrunch.com/2014/04/12/culture-eats-strategy-for-breakfast/

https://www.digitalistmag.com/cio-knowledge/2019/03/28/culture-eats-
strategy-for-breakfast-innovation-for-lunch-transformation-for-dinner-
06197367
Image: Pixabay

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Charlotte Gatehouse
Charlotte is an operating model consultant focused on the delivery of large-scale organisational
transformation programmes. She is an expert user and trainer in orgvue™. To contact Charlotte please
email charlotte.gatehouse@changeassociates.com