Today I'm doing a short session to an HR Forum "Organization culture and business success – are they connected?" I haven't done it yet (as I write I am traveling to the venue) but I'm wondering how it will be received. It's a topic where there's a fair amount of opinion on the answer and little definitive evidence i.e. consistent academic research to prove one thing or the other.
Many leaders are convinced that there is a connection. Reckitt Benckiser, for example, just won the 2009 Economist Innovation Award in the category 'Corporate Use of Innovation' because:
It has demonstrated strong sales and profit growth, even in the recession, in large part because of the strength of its innovative and entrepreneurial corporate culture. Controversy is encouraged, bureaucracy avoided and performance rewarded. A diverse multinational workforce provides a wealth of perspectives on consumer behaviour. …
But organizations are subject to external forces that may be beyond their control, and no matter how 'good' their culture they cannot successfully weather these (some of the banks are recent examples). Of course, that kind of statement leads to the argument that their culture was clearly not focused on business success, and that is a valid point: sustainable cultures should be able to weather all kinds of vicissitudes. But that too is open to debate – if it were true, where are the Romans, Aztecs, and so on. Were their cultures 'bad' or were they right for their times and circumstances changed?
Beyond sitting on the fence on this I have seven suggestions on how to make connections between culture and business work effectively, including:
• Be clear on what you define as business success
• Recognize where the culture supports/or not the business
• Be alert to "strong" v 'healthy' culture
I'll post the presentation later this week with some comments on how it is received.