Which came first, the chicken or the egg? We could ask a similar question about an organization’s culture. Is culture a manifestation of “how we do things around here” or does culture set the tone for actions that follow? Do we change culture by tackling it directly, or do we start elsewhere and allow culture to evolve? You might ask “what difference does it make?”, but with so much business literature dedicated to defining and shaping culture and corporate culture gurus speaking at global conferences, the matter of culture is perceived to be very important.
In the course of researching the process for developing a company philosophy, I’ve gained perspective about the relationship between philosophy and culture. Philosophy is defined as “general laws that furnish the rational explanation of anything.” An organization’s philosophy is a set of written and unwritten rules and guidelines. These rules and guidelines are established through trial and error and/or leadership preferences that define “how things are done around here”.
In his 1966 book, “The Will to Manage”, Marvin Bower, the now deceased managing director of McKinsey & Company from 1950-1967, offered a great perspective on the significance of company philosophy on driving company success and shaping culture. Setting company philosophy is a top-down endeavor. The philosophy supports a company’s mission and vision, describes the underlying principles that guide processes and interactions and ultimately defines the character of the organization.
With electronic media, we have shortened our attention span to moments. News has been reduced to a series of soundbites. If we expect a company philosophy to be embraced to the point that it expresses the soul of the company, the elements must be few in number and deep in substance. Bower suggests five – maybe six – elements but not more. Just as thought-starters, here are his five elements of company philosophy.
1. High Ethical Standards – Maintain high ethical standards in all internal and external relationships.
2. Fact-based Decision Making – Apply a disciplined process for fact-finding, analysis and decision making. Resist making decisions based on impulse, precedence or personalities.
3. Vigilance – Stay abreast of forces in the environment, e.g. technological, cultural or political factors and competitor activities, that have the potential of affecting the business.
4. Performance Based – Make judgments about people based on performance, not personality, potential, education, or personal traits and skills.
5. Sense of Urgency – Act with a sense of competitive urgency.
Although these may not be the core principles that you would choose as best drivers for your company, you have to admit, they are still relevant 50 years after being first published.
So, back to the question of culture. Culture is a product of a company’s philosophy. By everyone acting in a way that is consistent with the leader’s (or leadership’s) management philosophy a common pattern of behavior and consistency of thought emerges. Culture is formed. To influence culture, start by examining your company philosophy and answer the question, “How do we do things around here?” As a leader, if your organization’s culture isn’t what you would like it to be, consider your own management philosophy and its influence on those around you. Act with urgency (element #5) to lead the change.