Culture Eats Strategy for Breakfast

About 100 years ago, Henry Ford was quoted as saying “Culture eats strategy for breakfast.”  That was a long time ago and the business world has changed a lot since then.  But ironically the truth in that statement has changed very little.

A few years ago, I was hired to audit a recent merger of two rather large oilfield service companies.  My mission was to find and identify some specific performance issues in their quality system.  Before I began, my host closed the door and began to explain how the one larger entity (company A) bought out the other entity (company B) from the shareholders.  However, the new combined company was presented more as a merger of equals.  The equality was not working too well.  He told me that when I talked with the members of the old ‘A’ company, I would get one attitude represented by a culture of large company protocol and adherence to hierarchy.  He also said when I talked with the members of the acquired company ‘B,’ I would notice resentment and a lingering culture of a maverick attitude in the employees.  That maverick attitude is what the founder of the original company ‘B’ promoted throughout the original organization and it had made that company very successful.

The new merged company had developed a new grand strategy.  He summarized the new strategy for me.  I then continued and conducted the audit as required.  I quickly noticed the attitudes of each of the two member sets just as he had predicted.  The company ‘A’ members acted according to the old larger company culture and the company ‘B’ members retained their maverick attitudes from the former culture.  I got the feeling that this new ‘merger of equals’ would never work or at least never be able to achieve the strategic intent.

Now, fast forward a few years.  The ‘merger’ eventually did work out.  However, the strategic objective did not succeed in the desired time period.  It took about twice as long as desired.  The reason for the delay was clearly the culture clash.  Eventually the cultures melted into one another and the result was something much closer to the original ‘A’ culture.  The true mavericks of the original ‘B’ company left the merger for employment elsewhere.  This of course made the eventual success of the merger a bit easier.

I strongly believe that the success of any company is built around the concept of:

People, Processes & Strategy.

The strategy is the plan, the grand plan if you will.  It is what the executive have derived and refined as the direction and target for the organization.  The strategy is supported by the business processes.  Yet the business processes must be run by the people.    But the people are not mere positions being filled by robots.  These are people with people issues.  They bring experience – all of it, good and bad.  I once read a quote that said:

“We hired workers, but human beings came instead.”

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