We have all heard the phrase “Culture Eats Strategy for Lunch.” It is certainly a generalization and not applicable for all organizations, but not understanding your organization’s culture and the cultures of those you do business with can prove to be a big mistake. Many companies that fail do so because they develop strategies that just won’t work in their current culture and/or they fail to make the significant investment needed to change their culture. Understanding the current culture of who you are doing business with is also critical in ensuring a successful business relationship.
This concept is extremely important in the current environment of mergers and acquisitions within the healthcare industry, as well as the movement of top healthcare supply chain executives from health system to health system. As many large organizations are trying to become bigger to better compete within their markets, we are continuing to see mergers and acquisitions that require cultures to be merged or recalibrated to match established strategies. This takes extensive communication and change management processes that, if ignored, can torpedo the new organization. I have been involved in potential mergers that made great business sense; however, the cultures of these organizations clashed to such a great extent that the mergers were called off at the final hour. Had these mergers gone through, the new company would have either failed or it would have taken years to right the ship. I know of one merger that was unwound after two years just because they could not unify cultures. As these mergers do occur, I am seeing new leadership being put in place which develops its own culture, separating itself from any of its legacy systems.
Suppliers in our industry also go through some transformation as they either merge with or acquire other organizations. A supplier that you have had great success with in past years may in fact be a different organization in its current state. I have touted a supplier with whom I had an excellent relationship and experience with in the past, only to discover they recently brought on new leadership and significantly changed their culture from a “family-owned, customer-first” organization to a “revenue-driven” company. That has significantly changed their culture, the attitudes of their workforce, and the relationships they have with their customers.
My suggestions for understanding your organization’s culture include:
1.) Define key aspects of your company’s culture and assess whether you feel it supports the strategy of the organization: Some examples of culture are:
A. Top-down decision making or distributed leadership
B. Accountable or consensus building
C. Customer-first or revenue at all cost
D. Employer of choice or market-driven
E. Open and transparent or need-to-know
2.) Describe the culture you need to support strategic objectives for your specific operating unit, what culture you currently have (whether you are new to the organization or an established leader), and what changes you need to make to ensure your culture compliments your objectives
3.) Define the current culture of your key business partners and ensure that their culture supports your current strategies
4.) Include an assessment of an organization’s current culture as a part of any future criteria when establishing a key business partnership
There are never enough hours in the day to accomplish all you need to get done and a culture assessment is probably way on the bottom of your “to do” list (if it is there at all); however, alignment of culture and strategy can lead the way to an efficient and effective organization.
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