Finding Strength in Your Competitor’s Weakness

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One reason organizational culture does not make many leaders’ priority list is that it is hard to define. It’s squishy. It’s complex. Sometimes it’s even contradictory. Different employees will experience your culture differently, and even describe it differently. With all the other challenges your business faces, I can see why culture takes a back seat.

And that is a huge, huge mistake.

Culture may be complex and a bit messy, but that is precisely what gives it tremendous power. And I don’t mean the power to be one of the “cool kids” and have a smartly designed culture slide deck that goes viral. I mean power as in performance. Results. Profits.

In today’s economy, having the best product or making the perfect strategic move doesn’t buy you much time at the top. The competition, just like everything else in today’s world, moves faster than it used to, so that competitive advantage you just secured will very quickly deteriorate. As Rita Gunther McGrath wrote in Harvard Business Review, the landscape has shifted from looking for that long-term, sustainable competitive advantage to managing more of a portfolio of  “transient advantages,” moving from one short-lived advantage to the next.

what your company values drives behavior and attention

Sounds hard, doesn’t it? That’s because it is. But this is where culture comes in. A cultural advantage over your competitors has huge power. Culture is not about company brochures, posters on the wall, foosball tables, or vacation policies. Culture is the collection of words, actions, thought, and “stuff” that clarifies and reinforces what a company truly values. And what your company values drives behavior and attention, so it is a huge lever for driving the success of the enterprise.

It’s that simple. But not necessarily easy.

The key word in that definition is values. Culture is ultimately about what is valued. That can include flowery “values statements” if you like, but those statements aren’t where the power lies. Enron had nice statements in their lobby about things like integrity and honesty, but that wasn’t really valued, now was it? It turns out making numbers look good at all costs was valued, so that’s what people did. And what your company values drives behavior and attention, so it is a huge lever for driving the success of the enterprise.

So you need to get clear on what’s valued in your organization, and it must be the reality version, rather than the brochure version. As the definition above indicates, you will reinforce it through a mixture of words, actions, assumptions and “stuff” (tangible things like office layout, dress code, etc.), but it starts with clarity about what is valued and what drives success.

I can’t tell you what that is for your organization. You will have to figure it out for yourself. But I am going to point you in a specific direction.

If you want a powerful culture, make sure it taps into what makes us human.

When I work with organizations on their culture, I ask them to assess their organization along four continuums:

Decentralized…Centralized

Transparent…Private

Together…Separate

Learning…Doing

There is not one right answer here. Organizations are allowed to place themselves along different points on the continuums. All eight words above are good and appropriate at the right times. But based on both the research and the subsequent application of the ideas in my book, Humanize, I have learned there is power in moving towards the left side of the continuums: towards decentralized, transparent, together, and learning. These elements have been traditionally undervalued in our organizations, and they are precisely the elements that tap into the power of what it means to be human.

And you know those successful companies that get lots of attention for their strong and powerful cultures? They’ve figured this out too. Zappos gets attention for delivering “happiness,” but they do that by being decentralized and letting customer service reps make their own decisions about how much time to spend on calls and when to give customers upgrades. Netflix got some attention for its cultural emphasis on high performance (if you perform adequately, apparently, that earns you a “generous severance package”), but they connect it clearly to a cultural principle around freedom and responsibility, which also moves in the direction of decentralization.

Think about your culture and how effectively it taps into what makes us human. Don’t just copy the cool kids, and don’t just blindly adopt decentralization. But when you connect what makes us human with specific factors that drive the success of your company, you will be creating a competitive advantage that is both powerful and sustainable.

The economy is driving this. Demographic changes are driving this. But the bottom line is that human-centric culture is growing in importance as a competitive advantage factor. Ignore it at your peril.

 

 

Image credit- berkut2011 / 123RF Stock Photo

Jamie Notter is a consultant, speaker, and author who helps organizations perform better by strengthening their culture. Jamie brings twenty years of experience in conflict resolution, generations, diversity, social media, and leadership to his consulting work. An accomplished blogger (link to www.jamienotter.com), author, and speaker, Jamie has written three books, including his most recent hardcover (with Maddie Grant), Humanize: How People-Centric Organizations Succeed in a Social World.

  • http://www.savvycapitalist.blogspot.com TedCoine

    Jamie, what a powerful post! There should be no secret why we invited you to be one of our original Leaguers. “Humanize” is right in line with the values and vision of Switch and Shift – whose motto, after all, is “The Human Side of Business.” I’m so proud to be able to share your insight with the rest of our community.

    The left side of the continua you describe above: that’s what distinguishes the Age of Social from the Industrial Age. As you know, Mark Babbitt and I are writing a book about this very thing, “A World Gone Social.” [Readers: Jamie knows because we’re interviewing him as one of our key sources!] Command and Control, hoarding of information for personal advantage… all that worked great in a simpler time. Thankfully for us all, this brave new world we’re living in is not that time.

    I can’t wait to read your next piece, Jamie. I learn every time you write.

  • Graeme Dixon

    Good article. I would suggest culture is one on area of competitive advantage. An important aspect to enable you to compete. However if your product is terrible and no one wants it you will lose.

  • PETRA CHEQUER

    What a great post and powerful message to executive leaders! Thank you for summarizing the importance of corporate culture in this article, I could not agree more. It does not only drive transient competitive advantages, but is also critically important for success in M & A deals and drives talent attraction and retention which are such key challenges for many leaders out here in Siicon Valley.

  • http://LeadByGreatness.com David Lapin

    Wonderful to see a growing tide of thought-leaders who get the linkage between the intangibles of culture and strategy and their tangible outcomes. We have decades of documented evidence of the exponential growth this can deliver when effectively executed in medium to large organizations. Thank you Jamie.

    David Lapin
    http://www.LeadByGreatness.com

  • JohnRichardBell

    I’m fully supportive of the notion that “culture is the strategy” for today’s successful organizations. However, clarity of the right culture is a critical success factor, and no one is more important at defining, promoting, and living that culture than the CEO.

  • Grant

    I believe above culture there is a mission, and that the mission should dictate the culture. Whether the CEO or the Line Level team member, all actions, behaviors, values, and culture should be able to point back at the mission.
    This is to say that Even though a CEO/President/Owner of a company may have a heavy influence upon the culture of a company, the overriding vision or mission of the company should dictate who becomes the leader of said company. It is only through vison and mission that a culture can be passed on to future generations. Otherwise cultures are not cultures, but cults of personality.
    Remove a personality, and the cult(ure) dies.
    Business and organizations that fail to have a mission and vision that is clearly outlined and communicated find that they do not have their own “way”, and their business structure and long term prosperity are as fragile as the leader they may have put into power.
    That at least is my opinion

  • http://www.savvycapitalist.blogspot.com TedCoine

    Soooo with you there, John! I think of it like this: the CEO sets and nurtures the culture, the culture runs the company.

  • JohnRichardBell

    That’s a very nice way of putting it, Ted.

  • http://www.getmejamienotter.com/ Jamie Notter

    Well i agree with you guys, but maybe with an asterisk. I agree the role and particularly the power of the CEO in shaping culture is huge, but at the same time, I never want that to be an excuse that gets people out of creating a stronger culture. I think maybe we give TOO MUCH power to the CEO in that regard. This week I’m interviewing a CEO that intentionally let her COO spend 50% of his time on changing the culture, and it worked great. I’m interested to see what kind of role she played in the process.

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