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The Crucial Role of Organizational Culture

Importance of Organisational Culture to make use of Strategy
Organisational Culture

In the world of business, the phrase "culture eats strategy for breakfast" has become a popular well-known phrase. Coined by management guru Peter Drucker, this phrase emphasizes the undeniable influence of organizational culture on the success or failure of an organization. While strategy provides direction and goals, culture determines how well an organization can execute those strategies and adapt to changing circumstances. In this article, we will explore the concept of "Culture eats Strategy" in organizations and discuss why fostering a positive and aligned organizational culture is crucial for long-term success.

The Significance of Strategy

Strategy is a critical component of organizational success. It outlines the goals, objectives, and plans that guide an organization towards achieving its mission. It encompasses decisions related to market positioning, product development, resource allocation, and competitive advantage. Well-crafted strategies enable organizations to respond to challenges, exploit opportunities, and achieve sustainable growth.

However, even the most brilliant strategy can fall short if it is not supported by a conducive organizational culture.

Understanding Organizational Culture

Organizational culture is the collective values, beliefs, norms, behaviors, and attitudes that define how people within an organization interact with each other and make decisions. It is the unwritten code that guides employees in their daily work and shapes their perceptions of what is acceptable and expected.

Culture is not something that can be easily designed or changed through a memo or a presentation. It is the product of years of collective experiences and leadership decisions. Culture is reflected in how employees communicate, how they treat each other, and how they approach their work.

Culture vs. Strategy

Now, let's delve into why culture often takes precedence over strategy:

  1. Culture Drives Behavior: No matter how well a strategy is articulated, it's the culture that ultimately shapes how employees behave. For example, a company can have a strategy that prioritizes innovation, but if the culture discourages risk-taking or punishes failure, employees are unlikely to take the necessary creative leaps.

  2. Adaptability: The business landscape is constantly evolving, and organizations must adapt to survive. A strong culture that encourages learning, agility, and open communication is more likely to enable effective adaptation to changing market conditions. A rigid or resistant culture can hinder even the best-laid strategic plans.

  3. Employee Engagement: An organization with a healthy culture tends to have more engaged and motivated employees. Engaged employees are more likely to go the extra mile, resulting in improved productivity and customer satisfaction. A strategy, no matter how brilliant, cannot compensate for disengaged employees.

  4. Decision-Making: Culture influences how decisions are made within an organization. A culture that promotes transparency and inclusivity is more likely to make well-informed decisions that align with the organization's strategic goals. Conversely, a culture of secrecy and hierarchy can lead to decisions that undermine the best of strategies.

  5. Longevity: Culture is often more enduring than strategy. While strategies may change with shifts in leadership or market conditions, an ingrained culture can persist for generations. It is the culture that provides continuity and a sense of identity to an organization.

Building a Culture that Supports Strategy

To ensure that culture complements rather than contradicts strategy, organizations must take deliberate steps to cultivate a positive and aligned culture:

  1. Leadership Alignment: Leaders must embody the values and behaviors they want to see in the organization. Their actions and decisions set the tone for the entire workforce.

  2. Communication: Open and transparent communication channels are essential for building trust and alignment within the organization. Employees need to understand the "why" behind strategic decisions.

  3. Employee Involvement: Encourage employees at all levels to contribute to the culture-building process. Their insights and perspectives can be invaluable in shaping a culture that supports the organization's strategic goals.

  4. Training and Development: Invest in employee training and development programs that reinforce the desired cultural values and behaviors.

  5. Recognition and Rewards: Recognize and reward employees who exemplify the desired cultural traits. This reinforces the importance of culture in daily operations.

While strategy provides the roadmap for an organization's journey, it is the culture that determines the organization's ability to navigate that path successfully. The interplay between culture and strategy is not a zero-sum game; they must work in harmony for an organization to thrive.

Organizations that recognize the significance of a positive, aligned culture in driving their strategic objectives are more likely to achieve sustainable success in an ever-changing business landscape. In the end, it's not just about having a strategy; it's about having a culture that can bring that strategy to life.

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