Metaphors of strategy: Strategy as culture

 

One of the most notable definitions of culture is proffered by organizational culture guru, Edgar Schein. Schein refers to culture as ‘the basic assumptions and beliefs that are shared by members of an organisation, that operate unconsciously and define in a basic taken-for-granted fashion an organisation’s view of itself and its environment’. The culture of an organization is strongly related to its strategy. Culture, the way things are done in an organization, serves as a metaphor for strategy. Strategy is about being different and choosing a different set of activities to deliver a different value to customers.

 

Strategy unfolds in behaviours

Culture is mirrored in how people behave and how they express their beliefs through their conduct. Culture and the behaviours it fosters are intricately linked to strategy. The actions of organizations and their citizens are extensions of corporate strategy. In more open cultures, companies expect employees to relate less formally while in more hierarchical cultures, formality dictates activities. Whether a culture is formal or informal is displayed in how customers are served and is often primed by strategy.

Corporate values as representations of culture also propel corporate strategic action. In Edgar Schein’s three-level model of culture, espoused values are the rules of conduct, standards and values. A personal story will explain how this works. Some years ago, my travels took me to a Four Seasons Hotel and I made a booking in advance. Upon my arrival, my card payment did not go through for the deposit. After a few more trials, the outcome was the same. To my surprise, the front desk officer offered to check me in and give me time to resolve the issue. I was surprised but the officer was simply displaying behaviours stemming from values and reflecting strategy. These words from the values of Four Seasons Hotels, cap it up: “In all our interactions with our guests, customers, business associates and colleagues, we seek to deal with others as we would have them deal with us.”In the African context, UBA’s value of enterprise and its byline of “Africa’s global bank” is portrayed in an aggressive expansion across the continent in the past decade or so.

 

Strategy in the artefacts of culture

As strategy involves choice, what organisations choose to do is partly decided by prevailing culture. A fast food chain will design its locations differently from a fine dining restaurant. Fast food restaurants will not have elaborate décor, white table cloths and cotton table napkins. The seating style will suggest to customers that they are not expected to stay for long. The service culture will tend to be more hurried to reflect the strategy of quick turnaround times. Even softer things like background music will speak about the culture and how it is linked to strategy.

 

Schein’s culture model refers to artefacts and symbols – the visible elements of culture such as logos, architecture, dressing and processes. The design of certain buildings are expressions of culture while being delicately linked to strategy. Let’s consider two Nigerian examples. The distinct white pillars of First City Monument Bank beyond looking like monuments are strategic manifestations. They correspond in subtle fashion with part of the bank’s strategy statement to be “reliable and supportive”. Guaranty Trust Bank’s high-windowed outlets echo the bank’s logo and represents “a friendly brand that truly cares and this permeates through every sphere of our business”.

 

Culture and strategic decision making

An organisation’s cultural framework determines its strategic decisions. Strategy authors, Miles and Snow categorised organisations into defender, prospector, analyser and reactor. The categorisation helps us understand the connection between culture and organizational decision making.

Defender cultures are more comfortable with status quo and favour continuity and stability. Such organisations are slow to bring on innovation if not almost averse to it. Internal bureaucracy will guarantee that new ideas are not readily accepted. Most likely strategies for defender organisations will be specialization and cost efficiency. In contrast, a prospector culture aligns with change, creativity and rapid development of products and markets. Preferred strategies for prospector companies will entail monitoring the environment in search of opportunities for product innovation. Globally recognized examples of prospectors include 3M and Apple.

Analyser type organisations are mostly market followers who will watch market signals and analyse them carefully before taking decisions. Analyser entities will focus on market penetration and steady growth and not likely to be first-movers into any market. Such companies might take what other companies have initiated and scale them up such as IBM did with the personal computer. Reactor businesses are inconsistent in strategy and react to environmental occurrences rather than anticipate or influence them. By implication, reactors are market laggards and tend to perform weaker than the other categories.

 

Closing note

We may not always see the correlation between strategy and culture because it leans towards the inconspicuous. Nevertheless, upon closer observation, culture and strategy flow in the same direction. Indeed, strategy will be less potent if it does not align with culture. Culture is incomplete unless it is revealed in organizational strategy.

 

Weyinmi Jemide