Proactive strategy in organisational culture drives corporate performance
Organisational culture is fast becoming the new source of competitive advantage, because it boosts performance by enabling strategy implementation. Organisational Culture is the way members of an organisation relate to each other, their work and the outside world in comparison to other organisations. It can enable or hinder an organisation’s strategy.
Chief Executive Officers (CEOs) and Human Resource (HR) leaders now recognise that organisational culture drives people’s behaviour, innovation, and customer service. Eighty-seven percent of Deloitte’s Global Human Capital Trends survey respondents believe that “culture is a potential competitive advantage.” Knowing that leadership behaviour and reward systems directly impact organisational performance, customer service, employee engagement, and retention, leading companies are using data and behavioural information to manage and influence their culture.
According to the report few factors contribute more to business success than culture – the system of values, beliefs, and behaviours that shape how real work gets done within an organisation. Its close connection to performance is not lost on HR and business executives: Nearly nine in ten (87 percent) of our survey respondents say that culture is important, and 54 percent rate it as very important, nine percentage points more than last year. Culture brings together the implicit and explicit reward systems that define how an organisation works in practice, no matter what an organisational chart, business strategy, or corporate mission statement may say.
The report highlighted that a staggering number of companies over 50 percent in this year’s survey are currently attempting to change their culture in response to shifting talent markets and increased competition. In an era in which bad news travels instantaneously and an organisation’s culture is both transparent and directly tied to its employment brand, great companies consciously cultivate and manage their culture, turning it into a competitive advantage in the marketplace. Have you ever wondered why certain companies hire great engineers, deliver seemingly endless innovations, and generate consistent growth, while others always seem to be reinventing themselves? A large part of the answer, in one word, is culture.
Joseph Olofinsola, partner consulting at Deloitte, contended that “an organisation that focuses exclusively on corporate strategy without paying attention to organisational culture would face an uphill task. This is because organisational culture is the infrastructure on which corporate strategy functions. Therefore, organisational culture would eat corporate strategy for breakfast, that is, render it ineffective, when taken for granted.”
Olufunke Amobi, head, human capital, Stanbic IBTC and a talent manager asserted that organisational culture is at the heart of corporate performance and it is reflected in little things like office arrangement and communication channels. Organisations that empower individual workers and have decentralised structure tend to outperform their competition. For instance, at Stanbic IBTC, “we have an office arrangement designed to flatten the chain of command. A particular case is what we refer to as the executive office design in which all the executives sit in the same office. The impact of this on organisational culture and performance is huge. The message is, here we are one, and no one is superior to the other. The values driving this are: equality, accountability and transparency, as part of organisational culture exemplified by corporate leaders, this is indeed remarkable.”
Dare Shobajo, head, human resources, Lagos Business School, says that every organisation has a culture, a persona, a description of character, core values that control style, structure, systems and even people. Either as part of strategic elements of the organisation in terms of a mission statement or corporate symbol, or merely understood without any formal definition, corporate culture governs how the organisation thinks and thus is a critical success factor for how well a business and its employees will perform.
STEPHEN ONYEKWELU