"Culture eats strategy for breakfast"

Corporate culture has become one of the most discussed topics in the business world, and rightly so. Phrases like "Culture eats strategy for breakfast" coined by leadership guru Peter Drucker, emphasize that a strong company culture can outperform any strategy. But what does this really mean, and why is company culture considered so crucial to success?

What is company culture?

Corporate culture encompasses the values, behaviours, norms and attitudes that permeate an organization. It defines how employees relate to each other, to their work and to the company's goals. In other words, it is the invisible force that shapes how people behave within the company.

Culture is more than just nice words on a company website or in annual reports. It is about how the company's values are put into practice. For example, a company may have 'innovation' as one of its core values, but if employees don't feel encouraged to share new ideas, this value becomes meaningless. A vibrant company culture, on the other hand, where employees feel engaged and inspired, can make the difference between a successful and a mediocre company. So why is company culture important and what are the benefits of having a strong culture?

Engaged employees lead to higher productivity

Studies have shown that employees who enjoy their workplace and feel part of the company culture perform better. When people feel that their efforts are appreciated and that their values are aligned with the company, their motivation and productivity increase.

Attracting and retaining talent

At a time when competition for the best talent is fierce, company culture can be crucial. Many job seekers, especially in younger generations, look for employers where they can feel connected and develop on a personal level. Companies with a strong and positive culture not only attract the best, but also find it easier to retain them.

Promoting innovation

A culture that encourages creativity and risk-taking is often the one behind ground-breaking innovations. When employees feel supported and given the freedom to think outside the box, it can lead to major breakthroughs. A clear example is Google, which has long been known for its culture of innovation and collaboration. The company has created an environment where ideas can flow freely, leading to a range of innovative products and services.

Higher customer satisfaction

Company culture is not only reflected internally, but also affects the customer experience. Employees who feel engaged and supported are more likely to provide excellent customer service. Southwest Airlines is a good example. The company has built its success on a culture where staff are encouraged to be themselves and create a fun, inclusive atmosphere for both colleagues and customers. This culture has resulted in high customer satisfaction and loyalty.

Adaptability in times of change

In a world where change is the only constant, a strong corporate culture helps organizations to be flexible and adaptable. When an organization is built on shared values and principles, it becomes easier to implement change without losing focus or direction.

Jack Welch and General Electric

One of the most famous proponents of the importance of corporate culture is Jack Welch, the legendary CEO of General Electric (GE). During his time leading GE (1981-2001), Welch managed to transform the company into one of the world's most profitable and respected organizations. One of the main factors behind this transformation was Welch's focus on corporate culture.

Welch realized early on that to achieve long-term success, he had to create a culture of performance and accountability. He implemented the so-called 'Rank-and-Yank' method, whereby employees were regularly evaluated and the lowest 10% of performers were removed. This method was controversial, but it created a culture of continuous improvement and high performance.

In addition to this, Welch also advocated an 'open and simple' management style where honesty and transparency were fundamental. He was known for directly communicating the company's goals and vision to all levels of the organization. This not only created clarity and focus, but also built a stronger sense of trust and collaboration between management and employees.

Welch's focus on corporate culture has inspired many leaders and companies around the world, and GE's success under his leadership has shown how a strong culture can drive exceptional results.

IKEA and Ingvar Kamprad

One of the most shining Swedish examples of how corporate culture can build long-term success is IKEA, founded by Ingvar Kamprad. IKEA's culture is deeply rooted in Kamprad's personal values: simplicity, frugality and a strong sense of community. This has shaped IKEA into a global brand that is both loved and respected.

Kamprad's philosophy was to 'live as you learn', which was reflected throughout the company. He himself lived a relatively modest life, despite his success, and this simplicity is reflected in IKEA products and work environment.
Kamprad emphasized that everyone, regardless of position, should contribute to the company's success and that employees should keep their feet on the ground. There are countless stories of how Kamprad encouraged his employees to find creative solutions that saved money and resources, from using the same furniture customers buy to saving on office expenses.

This culture of humility and cost-efficiency has made IKEA successful and sustainable for a long time.

By focusing on core values such as responsibility and cooperation, IKEA has built a strong sense of belonging among its co-workers, which in turn has led to higher productivity and loyalty. This values-driven culture has also helped the company maintain its competitiveness in a global market where cost consciousness and customer focus are crucial.

How to create a strong company culture?

Building a strong company culture takes time and commitment. Here are some basic steps:

Define your company's values

Clear and well-articulated values are the foundation of a strong company culture. These values should be more than just slogans - they should guide daily decisions and behaviors.

Lead by example

Leaders play a crucial role in shaping and maintaining culture. Their behaviour and attitudes will set the tone for the rest of the organization.

Recruit for culture, not just skills

Hiring people who share your company's values is crucial to building and maintaining a strong culture. Skills are important, but if a candidate doesn't fit in with the culture, it can create tensions and reduce team effectiveness.

Encourage feedback and open communication

Create an environment where employees feel comfortable giving and receiving feedback. This promotes growth, improvement and an open working environment.

Celebrate successes and learn from failures

A culture that celebrates successes and sees failures as learning opportunities is more likely to grow and develop over time.

Conclusion

A strong corporate culture is one of the most powerful assets a company can have. It affects everything from employee engagement to customer satisfaction and long-term profitability. Examples from large companies like GE, IKEA and smaller players alike show that a vibrant company culture can be a powerful driver of innovation, sustainability and success. By focusing on creating and nurturing a positive and inclusive company culture, businesses can not only survive in today's competitive market - they can thrive.

If you would like to discuss how you can build your culture and create additional drivers for success and take your brand/company to the next level, please get in touch.