The biggest mistake organisations make around ‘culture’ is assuming ‘culture’ = ‘values’. Mettle warns against making the mistake of confusing ‘culture’ as being purely ‘values’.
Recent comments in the press such as 'businesses can’t learn culture' and 'culture grows organically and cannot be planned or structured or managed'1 is a fatal error of judgment and a key factor as to why many organisations continue to fail in developing the right culture to realise their company strategies.
Craig McCallum, spokesperson for the Mettle Group says, 'If the values are right, then they should last through the life of the organisation. Culture, however, changes at different stages of an organisation's life. The culture will need to change depending on the strategy implemented at a particular point in the business's cycle. If your strategy is to build a larger customer base, then one of your cultural qualities might be “customer centric“, for example. You then need to develop and nurture this cultural quality throughout your organisation. This quality is led from the owners or leadership team throughout the organisation. Only when you have the right culture in place—that is, “messages about how people in your organisation are expected to behave“—will you be able to effectively implement and realise your strategy.'
Culture is able to be measured through the use of culture measurement tools such as the Mettle Culture Gauge and other culture diagnostic tools that are readily accessible in the marketplace. 'Culture measurement tools should not be confused with climate surveys,' says Craig. 'Once you have a handle on the culture that has most likely developed by default, you can then create a culture by design. It is true: a lot of organisations have an organically grown culture. However, this can and must be changed and aligned to your strategy. It is no good having an organic culture that encourages non-accountability when you need to respond quickly to client demands in order to achieve your strategy,' says Craig.
'A dysfunctional culture can be a company’s fate-accompli.' We have seen examples of this with Enron, AWB and more recently with Coles. The Financial Times reported in Autumn 1999, 'The stability of Enron’s house of cards had been eroded by the very culture that had allowed it to be built…The very results Enron has sought to prevent—falling stock prices, and lack of consumer and financial market confidence—came about as a direct result of decisions that had been driven by Enron’s culture.'
A company will go through several stages in its lifecycle from start up to potential takeover, and the culture will change through these cycles in order to adapt to the strategy. However, the values should remain the same. As Dick Clark, CEO of Merck said, 'The fact is, culture eats strategy for lunch…you can have good strategy but if you don’t have the culture and enabling systems to implement that strategy...you will fail.'
'Culture is a valuable brand and personality tool that needs to be designed, structured, managed and nurtured and, contrary to some opinion, culture can be measured,' says Craig. 'As much as culture is considered an intangible, when non-financial factors are taken into account, earnings forecasts are considered more accurate, thus reducing risk to investors and having the right culture in place positions you well competitively and increases in your ability to attract and retain staff.'
Mark Fraser, writer-producer-director of the Enron musical, told The New York Times that the story of the energy company’s demise is an example of how embracing the wrong values can be lethal to organisational wellbeing and to the creation of shareholder wealth.
1 Brisbane Times, Life and Style, ‘Happy Workplaces Not A Priority’ 2 July 2007