Distillations in this newsletter: Values in strategy & the rise of people strategies; language for culture change; enablers of strategic autonomy.
A monthly concoction of insight, learning and things you might have missed for anyone who works on strategy, works with strategy or just loves strategy.
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This month …
- The role of values in strategy and the rise of people strategies
- Snippets on strategy you may have missed: If you want to change culture, change the language you use; enablers of strategic autonomy.
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The role of values in strategy and the rise of people strategies
As many of you will know, I always have a strand of research that I’m working on to help build new models and processes and to keep our consultancy fresh. Back in 2019 my research focused on analysing and benchmarking the published strategies of UK Universities, because every university has a published strategy, something most other sectors don’t do. I published an 80 page report on my findings at the time.
Recently, I decided to repeat this university strategy analysis, looking at strategies with a long-ish timespan (those with an end-date of 2030 or beyond) and currently I’m exploring how they present their strategic values. In this edition of Strategy Distilled, I want to give you a preview of the thinking behind this work and offer some suggestions on how you should think about strategic values in your own organisation, so they are more impactful in shaping organisational culture.
- 82% of all companies have official statements of their corporate culture and 72% of these referred to their company’s culture as values or core values.
- 75% of all CEOs interviewed in Harvard Business Review discussed their company’s culture or core values — even when not specifically asked about it.
The takeaway from this seems simple. Publishing and talking about your strategic values is important and is seen to be strongly connected to organisational culture.
Zoom out from the specifics and we can perhaps tie this into to a much broader trend that certainly seems to be happening in the UK – interest in ‘people strategy’ is on the rise over the past three years. Figure 1 gives a summary of Google Trends data on how frequently the term ‘people strategy’ was searched for in the UK – 63% more searches today compared to 2019.
Figure 1. Google Trends data on the search term ‘people strategy’
Clearly, some of this will be driven by the practicalities of managing pandemic-triggered working-from-home. But there also seem to be deeper undercurrents at play. Organisational change is, allegedly, increasing in both volume and pace. As it does, leadership styles need to focus less on ‘command and control’ and more on direction-setting and facilitation. And if front-line teams are going to be less micro-managed by the executive, they need to have strong values and tangible cultural norms to guide their decision-making.
Which brings me to the crux of my proposition to you. The ‘people’ part of your strategy needs to assume much higher significance than it has in the past. This is to equip you better for the changes your organisation is going to need to make without having the time it would like to prepare for them. You need to build a strong organisational culture enabling front-line teams to feel guided and empowered to make decisions without having to refer everything ‘upstairs’ for approval. Organisational culture, in turn, needs to be underpinned by strong organisational values, but this underpinning will only work if the values are clear enough to relate to employees’ lived experience in their workplace and strong enough to facilitate their decision-making in unforeseen circumstances.
How, then, do we present organisational values effectively? The first and often overlooked requirement is to be clear about what these values are and what they are for. In a recent interview with McKinsey, Melissa Daimler, Chief Learning Officer of Udemy and author of ‘ReCulturing: Design Your Company Culture to Connect with Strategy and Purpose for Lasting Success’, argued that achieving culture-fit doesn’t mean trying to get everyone to fit into the culture you already have. Instead, it is much better to bring a different set of perspectives that still complement who you are and what you’re doing as a company. You can’t continue to grow and be innovative, she suggests, if you don’t have additional perspectives on your team. Rob Estreitinho’s perspective is “don’t hire for culture fit, hire for culture add”.
Not everyone in the organisation needs to hold your organisational values personally. They are organisational values, not a prescription for the individual values of every employee. It would be an odd organisation indeed that said it cherished and sought diversity across its workforce in every regard except the personal values they hold.
Values do, however, need to be acted upon, and need to be seen to be acted on, across the organisation. Many organisations have a published set of values, yet they are never talked about. They are not referred to in meetings. They don’t seem to have had any influence on the key decisions made by senior leaders. It may not even be clear how values are meant to inform decisions and guide actions. Which brings us to the second requirement for presenting organisational values effectively: be explicit about how your values are meant to be translated into action. In November’s Strategy Distilled, I gave three examples of companies explaining how employees ought to be ‘innovative’. Nvidia: “We know our path to discovery will be paved with mistakes. We anticipate and avoid the ones we can. We accept, learn from, and share the ones that occur”. Biogen: “We encourage candor to test assumptions and uncover the best ideas”. Amazon: “Leaders expect and require innovation and invention from their teams and always find ways to simplify”. I recently found an even better example from Jon Azoulay, founder of tech recruiting platform talent.io. His company had a value called ‘Think team’ and this is part of how he described how to turn it into action:
- Conflict happens – stay aware of that.
- It’s not OK to be aggressive towards others, but it’s OK to really defend your opinion if you feel strongly about it. Be hard on the problems, soft on the people.
- If conflict arises, address it immediately and face to face.
- If you can’t resolve it, it’s OK to involve a mediator — another team member trusted by both parties.
A couple of interesting case studies here come from Minecraft and Birkbeck, University of London. As covered in this past July’s Strategy Distilled, Minecraft, one of the biggest selling games of all time, recently decided to exclude non-fungible tokens (NFTs) from its platform because they “don’t align with Minecraft values” – a great example of values being used to guide strategic action. Birkbeck, University of London recently hit the headlines with a dramatic example of a values-driven decision. They banned all fossil fuel companies from recruiting students through their university careers service, on the basis that they didn’t want to hold relationships of any kind with the oil, gas or mining companies they considered “most responsible for destroying the planet”. Whilst undoubtedly a bold move, taken, they explain, in response to campaigns by their students, there is an interesting twist to this tale in the present context. Neither Birkbeck’s strategy nor their statement of organisational values on their website suggest they have the slightest interest in any environmental issues at all, far less any inclination towards radical, sector-leading activism on environmental campaigns. The lesson for all of us here? Try to keep our values and our actions aligned or in at least approximate harmony.
Finally, the third requirement for presenting organisational values effectively: if values are really going to serve as useful decision tools, guidance will be needed on how the different values take precedence or are reconciled. Imagine facing a decision between two options. Option one will make more money but increase our carbon footprint. Option two will make less money but reduce our carbon footprint. Our values say we need to be both commercial and sustainable. At face value they don’t seem to help me make this decision. If, however, the sustainability value went on to explain that our long-term goal was to be carbon neutral by 2030 and, in the meantime, any new initiative that increased our carbon footprint would need sign-off by the senior leadership team, I then have a basis for my decision-making. I have the authority to approve Option 2 myself but if I’m convinced Option 1 is better for the organisation, I’d better start preparing the case to go the leadership team.
Four things I hope you might take away from this:
- Look at the values in your strategy in a new light – they may increasingly underpin your organisational culture and drive the people aspect of your strategy;
- Start making moves to clarify what your values are for and how they should be used across the organisation (especially how they influence the behaviour and decisions of senior leadership);
- For each of your organisational values, be explicit about how that value ought to be translated into action. What, if we are to comply with this value, should we strive to do that we might otherwise have overlooked and what should we strive to avoid that we otherwise might have done?
- Guide and advise on how different values take precedence or are reconciled, should they come into conflict.
Snippets on strategy you may have missed
If you want to change culture, change the language you use
Related to the above piece on values comes more wise words from a favourite of Strategy Distilled, Tim Casasola. Tim suggests that old habits are often sustained by familiar use of language and that introducing new habits into an organisation can often be facilitated by changing the language used. He gives the example from his organisation of an ‘Air Traffic Controller’ (ATC), whose role is to help a project run as smoothly as possible. The ATC is aware of everything: deadlines, stakeholders, internal meeting times, client meeting times, team dynamics, client dynamics, etc. This, he argues, is different from a project manager, who is often a dedicated professional who does nothing else but project manage. Tim’s Air Traffic Controllers are different. They are strategists, designers, and developers who take on an ATC role, for one project, whilst contributing to other projects in their discipline. Perhaps more importantly, though, the introduction of a new form of words to describe a new role, signals new ways of working for every team working on every project.
Strategic autonomy is enabled by clear intent and technical excellence
This great guiding principle from Jason Yip, is explained with a quote from David Marquet’s remarkable book ‘Turn the Ship Around’.
“Control, we discovered, only works with a competent workforce that understands the organization’s purpose. Hence, as control is divested, both technical competence and organizational clarity need to be strengthened.”
The strategy lesson for me is that the more you want your strategy to be adopted widely across the organisation the more clarity there needs to be about its strategic intent.
Goal Atlas gives you structured processes and tools to ensure strategy is adopted and impactful across your organisation. Get in touch if you think we might be able to help.
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Discover the content of past issues of Strategy Distilled.