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Culture Still Eats Strategy for Breakfast

March 31, 2022
It took us years to move from top-down to people-centric management, but the journey was worth it.

IndustryWeek's elite panel of regular contributors.

Peter Drucker once said, “Culture eats strategy for breakfast.” Throughout my career, I have spent a lot of time in the strategy room. But no matter what we decided there, until we got the organizational culture right, we were unsuccessful in executing our goals.

So, I must agree with Mr. Drucker.

At Onex, we take pride in our organizational culture. It took us years to move away from traditional top-down management to a people-centric focus. That is not to say we are perfect, as we are continuously trying to improve.  For 2022, our company’s wildly important goal is to improve our customers’ experience. If, as a team, we are firing on all cylinders, then the client will be happier.

We started this journey with an organizational culture assessment. The process began with an online survey with questions based around pay, benefits and job satisfaction. Additionally, we included questions that we felt were important for Onex based on the mission of the company to make things better, our core values as they relate to behavior and whether employees felt their contributions were recognized and appreciated. And conducted one-on-one interviews with almost all personnel—in my opinion, the most important part of the process.

Why is feedback so hard to hear, even when you ask for it? Why do you focus on the few negative things when so many things are going well?

What We Learned

Overwhelmingly, people love their jobs. Employees feel their work is a part of a larger mission to support American manufacturing. Everyone understands we are helping to maintain critical industries such as aerospace, defense and oil and gas.

As an organization, we know mistakes will happen. What is important is how we solve problems and grow through learning. We treat people fairly and work to improve daily.

Where We Need to Improve

As the findings were presented in our board meeting, the leadership team was all wrapped up in an area of opportunity surrounding siloed departments. At Onex, our office and production staff are at the plant daily. However, the other departments are not in the same facility most days. Our service teams are almost always on a client’s site repairing their industrial furnaces. So, yes, we are siloed by physical location.

While we discussed how to tear down the silos, one board member told us a story about milk cows. She grew up in Minnesota on a dairy farm. There were times when a fence would break and the cows from the first milking group would mix in with the cows from the second milking group. Her father said, “Just wait a little while. The cows will return to their own groups.”

Seems it is human, and cows’, nature to want to be with the ones you know and are comfortable with. Therefore, as a leadership team, we must ensure that we are focused on improving all areas of the company and not just our direct departments.

Going Forward

It seems like it has been years since we have had leadership training. Oh wait—it has been two years! My, how time flies when you are running a business during a global pandemic.

Time for us to get back to the basics. As a leadership team, we are committed to learning and growing together so that we may help our teams by being better listeners, coaching through the problems, recognizing individual contributions and rallying the team around a common mission to revitalize American manufacturing.

Putting It to the Crowd …

I started a discussion on Linkedin about Drucker’s quote. Here’s a sample of what others said. If you have something to add, please, join the conversation!

"I've always interpreted this phrase to mean that the best strategy in the world can't overcome an incompatible company culture. Ex. if the strategy requires a more agile, entrepreneurial approach but the culture is rooted in a more traditional/hierarchical structure, the resulting intersection will be more heavily influenced by the prevailing culture than by the desired strategy. … When a company is looking to implement a strategy that will drive a real step-change in the organization, they have to consider all of the stakeholders. It's common to see a new strategy developed in response to something in the external operating environment (technological advancement, competitive re-alignment, geopolitical issues, etc). Creating a unilateral response (Strategy) without considering the skills, resources, capacity processes, history, mindset (culture) of the workforce...and I mean the workforce beyond the executive team... is a recipe for disaster during the execution phase."—Manufacturing consultant

"I have mixed views on this. … The only drawback we see with culture fit firms is they foster complacency and same thinking and exclude diversity of thought. I guess the best thing for firms would be find out what's missing in their current culture and hire the talent with those sought-after values, so that you get a colorful hat of mixed talent."—Fintech client relationship manager

"Great quote from a great business mind. Would you rather go into battle with a great plan and mediocre team or with a great team and mediocre plan. Great cultures create a feedback loop that often self corrects bad strategy. Horrible cultures fail to execute good strategy."—CFO at an acquisitions group

"I had this on the whiteboard in my office (I would always put up different inspirational quotes) and during a VP visit I was told to 'take that stupid sh** down, profit > everything is the only quote we live by here.' That's why I *had* it in my office, past tense, lol. If the culture isn't right, nothing else will be, that's something that you can always take to the bank."—Value stream manager at a manufacturer

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