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Legendary management guru Peter Drucker never actually said, ‘Culture eats strategy for breakfast’. But the epigram stuck. In fact, the two are entangled; an effective strategy requires an enabling culture.
This is Part 1 | Read Part 2 | Part 3
[Listen to audio version, read by David Hodes]
But what is culture? When asked this question, many provide the tautologous answer ‘the way we do things around here’. Such a response does not help answer the critical questions of a given organisation’s culture at a given time in its history, and how a productive and generative culture might be cultivated into the manageable horizon.
Much of my understanding of culture comes from the work of Emeritus Professor Ed Schein, who founded the Centre for Organisational Learning at the MIT Sloan School of Management. Schein’s model invites us to look at three levels of culture: artefacts, espoused beliefs and values, and basic underlying assumptions.
The iceberg metaphor is helpful here in that what we see at the top, above the waterline, is the manifestation of what is going on at a much deeper level. You may walk into an office or worksite and look at the general presentation of the work environment. Is it tidy, freshly painted, filled with light, or dark and dingy? Are the spaces intentionally set out like an Apple Store, or is it all rather more like the office of an inundated cohort of junior law clerks? How do people behave towards each other? Are they competitive or collaborative? Bureaucratic or in flow? Cynical or inspired? Family-like or formal? These are artefacts. But even with these, it’s not easy to know what’s really going on, based only on simple observations of what our senses feed to the meaning-making machine of our minds.
Dig a bit deeper, and we are in the realm of espoused beliefs and values. Espoused because they are what we read on the posters, see on the presentations, and hear from the functionaries when we ask questions about ideals, goals, values, and aspirations. When we notice a discrepancy between the espoused values and the actual behaviours, we’re likely to be fed some well-rehearsed rationalisations: ‘Mary’s behaviour is not congruent with our publicly stated value of inclusion, and we have had a lot of complaints about her abrasive and demeaning management style. Still, her personal story allows us to help her more fully activate the better angels of her nature, as, despite everything else, she delivers the results the business is looking for.’
Down at the deepest level, we are into the realm of the unconscious—the same domain that informs the myths we live by. In that domain, we answer the questions about the meaning and purpose of our lives, how we got here, and what we will do with the finite time we have left. In a productive culture, there is a deep congruence of value at all the levels within which we operate: the personal, the team, the organisation, and the society in which we live.
Arriving at such a state of harmony within an organisational setting is never easy. We have two significant challenges to overcome: external adaptation and internal integration. Before exploring these two challenges in more depth, it is worth quoting Schein’s definition of culture in full:
‘The culture of a group can be defined as a pattern of shared basic assumptions learned by a group as it solved its problems of external adaptation and internal integration, which has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems.’
In other words, what we learn about solving the problems of external adaptation and internal integration and how we examine the assumptions that inform that learning is of the essence to culture formation.
External adaptation includes understanding how we get to play our game within the markets in which we compete. We need to articulate our mission and strategy in a way that all critical stakeholders understand. We must embrace the question that asks what the fundamental problem is that we solve for those who consume our products or services? Given our mission, what is our goal? At least how much of what, by no later than when? How must the accountability hierarchy be constructed to best serve the processes which deliver on the mission? What means will we need to secure to accomplish our mission? How is the division of human, financial, material and information resources determined and allocated? What will we measure, and how could those measures be used to control progress towards our stated goal? How will we develop a consensus on the when and what of course corrections? What are the appropriate remedial or repair strategies to be used if goals are not being met?
Internal integration proves a more challenging arena for us to understand. It begins with the idea of creating a common language, where words and conceptual categories have shared meaning. As an example, think of the number of acronyms we demand a recruit learns before they come to readily understand the local dialects. The idea of internal integration begs the question of the extent to which the integration applies. What is the boundary for inclusion, and who, then, is in or out? By what criteria is membership determined?
Once we know the group’s boundary, each must work out its pecking order, criteria, and rules for how someone gets maintains and loses power and authority. Consensus in this area is crucial to help members manage feelings of aggression. If there are no rules around the exercise of power, we trigger that primal aggressive response associated with unfair authoritarianism.
Over time, every group must work out its ‘rules of the game’ for peer relationships, relationships between the sexes, and how openness and intimacy are handled in managing work. Consensus in this area is crucial to help us define trust and manage feelings of affection and love. How much damage has been done by the office affair? It’s not easy to navigate from the locker room to the board room. In brief, norms must be developed around trust, intimacy, friendship, and love.
Included in the theme of fairness at work, to develop a productive culture, we must come to share an understanding of what behaviour is heroic and what is unacceptable. Once we know these behaviours, we must achieve consensus on how we reward what is good and punish what is terrible.
And then there is the realm of the unexplainable—those events that fall outside the boundary of the day-to-day which challenges our well-worn nostrums of habit. How do we give meaning in a way in which group members can respond to them without excessive levels of anxiety?
Coming to meaningfully understand all these aspects of external adaptation and internal integration goes well beyond simply taking stock of the artefacts of culture, and even the deeper level of the espoused beliefs and values. To fully understand the culture of a group, we would need to equip ourselves with the competencies of a social anthropologist. Having said that, I have found the Competing Values framework offered by Cameron and Quinn helpful in getting an early read of the four archetypes they have in their model: Clan, Adhocracy, Hierarchy and Market. This model, illustrated in the diagram, looks at the competing values associated with an internal or external focus and whether stability and control are most essential or flexibility and discretion.
No organisation is at any given time any one of these archetypes, and there is always a natural tension between where the organisation is, compared to where the members would like it to be. There is an ongoing dynamic between the internal and external focus and whether the emphasis is on integration or differentiation. Many factors could influence the choices which value stability and control over flexibility and discretion or vice versa.
Even acknowledging that these competing values are forever in the dance of change, shifting the centre of gravity from one cultural archetype to another quadrant is far more challenging to accomplish than many in the field care to acknowledge. In the same way that a nick in a sapling is visible in the grown tree, so too does the influence of the founders run within the organisation’s DNA throughout its life.
It takes a very long time to learn to succeed in any given endeavour and the habits formed from learning how to succeed are not readily surrendered. We are far more ready to acknowledge when markets change, and our focus and comfort is found in what needs doing in the external competitiveness arena. It is far more challenging and takes much longer than we would ordinarily allow to co-create a new way of being in all the areas of internal integration outlined above.
In my next article, we’ll explore more deeply the subcultures present within most organisations as well as dig into the kinds of mental models we carry when assessing our place within a culture.
This is Part 1 of our series on Culture.
Part 1: Cultivating culture
Part 2: Culture – Digging below the surface
Part 3: The Anxieties of Changing Culture
The change to using Theory of Constraints (TOC) as an underlying operating system is both profound and exhilarating. We’ve developed the Systems Thinker Course to bring the ideas into your organisation.
[Background image: Man painting himself, Marina Montoya on Unsplash]
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