Culture eats Strategy for Breakfast
Why do strategies fail despite clear roadmaps, budgets, and KPIs? Often, it is not the strategy itself that is at fault, but rather the cultural conditions on which its implementation is based. The quote “Culture eats strategy for breakfast,” often attributed to Peter Drucker, the pioneer of our current understanding of management, sums this up succinctly. Corporate culture is not a soft factor for HR departments—it is a hard performance factor that determines success or failure.
But what does it take to shape culture in such a way that it supports strategy? How can you tell whether the shared values and how an organization works are in line with what the organization wants to achieve? And what role does leadership communication play in this? In conversation with René Michael Weber, Managing Partner at RMW consult AG, we shed light on how boards of directors can actively shape culture.
René, you say that culture is at the heart of governance. How do you see culture and leadership as being connected, and what role does communication play?
RMW: Culture becomes a leadership task as soon as decisions are made—in other words, all the time. Rules, routines, and the use of resources reflect the desired attitude and established behavior within the company. Communication comes into play when attitudes and behaviors need to be understood. It explains the “why,” makes priorities clear, and ensures consistency. However, when words and systems don’t match, a cultural rift emerges. Leadership brings culture to life, and communication reinforces this effect. Ideally, managers act as cultural translators in this process.
What do you see more often these days: strong words without cultural substance or lived culture without a common language?
RMW: Neither. I often see no clear vision of a corporate culture that will be useful for the future. It is neither continuously measured nor strategically developed. This means that the prerequisite for a common language and truly strong words is already missing. It is not enough to simply define values and publish them in a spectacular way without adapting the entire operating model, including KPIs, bonuses, and governance. Middle management then works on projects, but not on the strategic development of a future-proof corporate culture.
You describe corporate culture as a hard performance factor. How can a board of directors tell whether culture is actually effective and not just sounding good?
RMW: It is a common misconception that culture is a “soft” issue. Based on many projects, we can show that cultural development indirectly boosts earnings. The impact path is intuitively obvious: if employee collaboration improves, customers are the first to notice—and then the bottom line. We have already been able to make several customers significantly more productive through the right cultural interventions, thereby increasing their profitability.
Mission statements are supposed to provide guidance, but they often lose their power. What distinguishes an effective mission statement from a nice piece of writing in your opinion?
RMW: An effective mission statement defines the normative framework of a company and should ideally guide all decisions. It describes the ideal concept of behavior, rewards, development, communication, and customer processes. It is integrated into the management system, regularly discussed, and reviewed. This makes it more than just a nice piece of writing. Mission statements lose their power if they cannot be integrated into the reality of the company.
Positive leadership and PERMA* are considered measurable. How can corporate culture be measured?
RMW: In order to derive optimal improvement recommendations, experience, behavior, and impact should be measured. This can be done, for example, using a PERMA analysis, psychological safety, 360-degree feedback against the company-specific leadership competency model, and various key performance indicators such as time-to-decision, NPS/CES, turnover, and absenteeism.
Objectives and Key Results (OKR) combine strategy, focus, and agility. What is the communicative lever that prevents OKR from becoming just another management tool?
RMW: The lever is dialogue, not the template: Objectives tell us the “why” (customer, risk, operation), Key Results measure the “what matters.” The rule is: weekly short check-ins, monthly reviews, and quarterly retros – consistent and transparent. The focus is on change, there is no bonus linkage, the KRs are outcome-oriented, and there are consistent lessons learned. OKRs support the company in increasing alignment on the path to its vision, moving forward in a focused and synchronized manner, and communicating about it.
Recommendation from René Michael Weber – Key cultural issues for the board of directors:
- Do we really give leadership and culture the importance they deserve, or do we still treat them as secondary issues?
- What kind of culture and leadership do we want to see in the future?
- How do we measure culture and leadership, and how do we ensure that we actively develop them further?
- Where is the biggest cultural gap between what we say and what we measure?
