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A Shifting Strategy Must Account For Cultural Shifts

by Jaffe /

For an organization to be best-in-class, its leadership must not only understand the difference between strategy and culture, they must pursue them both separately and deliberately. A heavy emphasis on strategy cannot make up for a lack of attention to culture cultivation.

Raghu Krishnamoorthy, Vice President of Executive Development and Chief Learning Officer at GE, understands this concept well. Krishnamoorthy’s recent article in Harvard Business Review explains how the conglomerate has continuously updated its strategy and culture in tandem throughout changes in leadership, industry disruption and unexpected external factors.

“At GE, we have stayed competitive for more than 130 years because of our relentless quest for progress on all fronts, including culture,” Krishnamoorthy said. “We believe that there is no such thing as a 130-year culture. In our opinion, culture is contextual, and what would have been appropriate in the 19th century, when the company was a one-product, one-country organization, is very inappropriate in today’s far more globalized environment.”

The latest upheaval of GE’s culture is based largely on crowdsourced input from the company’s own employees, in an effort to “drive a culture that the employees wanted to see.” The result is a culture built upon smart simplification, where the comparatively lean management of today’s startups are applied to the multinational behemoth.

Annual strategic planning summits are gone, replaced with a continuous process of evaluation and adjustment that makes GE more nimble. The company invested heavily in developing a new workflow program, FastWorks, which endeavors to deliver faster, better results to GE customers using fewer resources. GE’s IT experts are viewed as valued assets rather than growing expenses. These are all strategic changes, but GE has matched each one with new core values to ensure that its culture keeps pace with its strategy.
Many businesses are slow to adapt to cultural changes, but as circumstances force new business strategies, forward-thinking organizations would be wise to learn from GE’s example. Culture must respond in sync with new strategic plans.

The same kinds of factors that spurred change at GE are also putting pressure on organizations of every size. New leaders are anxious to take the business in new directions. New technologies are automating or simplifying services and as always, unpredictable external events will continue to impact business.

It’s easy to see the need for new strategies to respond to these factors. But tomorrow’s most promising organizations are those that can see the need for cultural change as well.

(Editor's Note: The post originally appeared on generationgenerosity.org. Jaffe is a public reputation resource focused on law firms, legal associations and legal market vendors.)

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