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Culture eats strategy for breakfast


Business lesson # 2: “Culture eats strategy for breakfast” – Peter Drucker

The first time I read the above quote, I was slightly baffled.  Surely, building and sustaining a competitive advantage in the business world depends on the ability to produce a winning strategy?  Surely, a clear, differentiated strategy provides the direction for a team to channel their energy?  Surely, without strategy a team won’t know where they’re going and they won’t know when they’ve arrived?

In my experience, strategy plays a major role in the success of a business.

However, strategy per se does not make a business successful.  All successful businesses have found solutions to difficult problems and have developed the ability to execute them well.  A great strategy that is poorly executed will lead to poor results.  However, a mediocre strategy that is well executed will lead to decent results.  Of course, a great strategy that is well executed will lead to exceptional results.  Therefore, the goal should always be to master both strategy and execution, but without execution, even the greatest strategies in the world will still ultimately lead to failure.

Enter culture: 

Execution depends on people, and culture is about the way people do things.  A strong corporate culture, based on core values, creates the framework for discipline, focus and ethical behaviour - which in turn leads to good execution of strategies.

John Buchan talks about the fact that the function of leadership is eliciting the greatness in people, (not to put it there, because it is already there).  In my experience, the most effective way to elicit the greatness of people is to create a strong culture based on core values (a value is a deep belief that drives a person’s behaviour).

The lesson I’ve learnt is that success in business depends more on execution than on strategy.

That doesn’t mean strategy is unimportant.  Far from it.  It does, however, mean that more time and energy should be spent on execution - and thus culture - than on strategic planning.

Whilst it is reasonably easy to copy a strategy, it is impossible to copy a corporate culture.

Lastly, I wouldn’t go as far as to say that culture eats strategy for breakfast, but I do believe culture trumps strategy. Culture is king!


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