3 Steps to Align Culture With Business Strategy
Emotion and data help align culture with business strategy, says Deloitte culture expert.
When on the road to improving a culture, it makes sense to measure first. However, culture is a pretty nebulous concept, making it hard match up with data. Consulting firm Deloitte says it figured out a way to do just that.
Culture is the “set of values and attributes that shape how things get done in the organization,” said Anthony Abbatiello, a principal in Deloitte’s human capital practice and who is also responsible for leadership and culture business. Ultimately, culture is how the business strategy becomes reality.
To measure how the two align, Deloitte created a product called CulturePath, which defines behaviors that should exist to support business, assesses a company’s current culture and compiles insights that can guide the company in the future. Using 72 data points, Deloitte analyzes survey results from employees to catch themes in responses, Abbatiello explained. A company using this product can see analytics, which provide support when making decisions on how to move the culture forward.
When asked if this measurement can be done without the Deloitte product, Abbatiello said companies can define their cultures and align their strategies with identified attributes, but it’s difficult to measure behavior without a diagnostic tool. Culture is a success factor for business growth, so a tool can only help a company to examine their culture.
To define company culture and measure it, Abbatiello outlines the following steps:
Align culture and strategy.
Look at the eight indices, as outlined by Deloitte, and identify what behaviors to enable from these indices.
The four core indices are foundational to each organization.
- Risk and control: This determines the extent to which people take risks at the company.
- Collective focus: A balance of team vs. individual focus.
- External orientation: How much an organization emphasizes a focus on customers and stakeholders.
- Change and innovation: The extent that an organization emphasizes ambiguity, change and risk.
Four differentiating indices drive an emotional connection to help the workforce execute the business strategy.
- Courage: How readily people challenge status quo.
- Inclusion: Working with diverse colleagues’ ideas.
- Commitment: Willingness of employees to support the larger business plan.
- Shared beliefs: How easily people join in common understanding of the company challenges and opportunities.
Measure how the business strategy aligns to these indices to determine how to gauge emotional connection to staff. Have the business leader and their human resources partner manage this culture.
With CulturePath, high scores on the differentiating indices indicate that staff is connected to the business strategy. Low scores mean alignment is lacking.
If they see a low score, companies might be tempted to change their culture. However, Abbatiello thinks the focus should be around aligning culture with the business strategy, which requires effort over a long period of time. To do so, he recommends the following:
- Define who your culture carriers are. These are often leaders. Define what leader behaviors need to be in order to live the culture. For example, to increase courage, leaders should support their staff when taking risks.
- Systematically reinforce the behavior. Find important company events where culture comes out, such as sales process, annual budget process and the performance management process. Rewarding or aligning those with attributes of behavior is important in monitoring culture.
- Have leaders tell stories. “There’s a power of storytelling in an organization that is really important for the culture and for connecting emotionally with your workforce,” Abbatiello said. When communicating the importance of taking risks, employees will respond to a story about a risk the leader took, how they failed and what they learned. This is more powerful than simply hearing a leader say, “Take risks.”
Storytelling is particularly strong, as it helps express the emotion behind a culture goal. “Emotions are the driving force for human behavior, much more than reason,” Abbatiello said. Use that to your organization’s advantage to build or create the culture that best matches business strategy.
This story originally appeared in Talent Management magazine.