Session 12:

Implementing Strategic Planning

Through
Corporate Culture and Leadership

Lectured by:
Prof. Dr. Ferdinand D. Saragih, MA.

Defining Characteristics
of Corporate Culture
Core

values, beliefs, and business principles

Ethical standards
Operating practices and behaviors defining
how we do things around here
Approach to people management
Chemistry and personality permeating
work environment
Oft-told stories illustrating

Companys values
Business practices
Traditions
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Identifying the Key Features

of Corporate Culture
A companys culture is manifested in . . .

Values, business principles, and ethical standards preached

and practiced by management
Approaches to people management and problem solving
Official policies and procedures
Spirit and character permeating work environment
Interactions and relationships among managers and
employees
Peer pressures that exist to display core values
Its revered traditions and oft-repeated stories
Its relationships with external stakeholders

Where Does Corporate

Culture Come From?
Founder

or early leader

Influential
Policies,

individual or work group

vision, or strategies

Operating

approaches

Companys

approach to people management

Traditions, supervisory practices, employee attitudes

Organizational
Relationships

politics

with stakeholders

Types of Corporate Cultures

Strong vs. Weak Cultures
Unhealthy Cultures
High-Performance Cultures
Adaptive Cultures
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Characteristics of
Strong Culture Companies
Conduct

business according to a clear, widelyunderstood philosophy

Considerable

time spent by management

communicating and reinforcing values

Values

are widely shared and deeply rooted

Have

a well-defined corporate character,

reinforced by a creed or values statement

Careful

screening/selection of new
employees to be sure they will fit in
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Characteristics of Weak Culture Companies

Lack

of a widely-shared core set of values

Few

behavioral norms evident in operating practices

Few

strong traditions

No

strong sense of company identity

Little

cohesion among departments

Weak

employee allegiance to
companys vision and strategy

Characteristics of Unhealthy Cultures

Highly

politicized internal environment

Issues resolved on basis of political clout

Hostility

to change

Avoid risks and dont screw up

Experimentation and efforts to
alter status quo discouraged

Not-invented-here

mindset company
personnel discount need to look outside for

Best practices
New or better managerial approaches
Innovative ideas

Disregard

for high ethical standards and

overzealous pursuit of wealth by key executives
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Characteristics of
High-Performance Cultures

Standout cultural traits include

A can-do spirit
Pride in doing things right
No-excuses accountability
A results-oriented work climate in which people go the extra
mile to achieve performance targets

Strong sense of involvement by all employees

Emphasis on individual initiative and creativity
Performance expectations are clearly identified for all
organizational members
Strong bias for being proactive, not reactive
Respect for the contributions of all employees
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Hallmarks of Adaptive Cultures

Willingness to accept change and embrace challenge of

introducing new strategies
Risk-taking, experimentation, and innovation to satisfy
stakeholders
Entrepreneurship is encouraged
and rewarded
Funds provided for new products
New ideas openly evaluated
Genuine interest in well-being
of all key constituencies
Proactive approaches to
implement workable solutions
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Culture: Ally or Obstacle

to Strategy Execution?
A companys

culture can contribute to or hinder

successful strategy execution

A culture

that promotes attitudes and behaviors

that are well-suited to first-rate strategy
execution is a valuable ally in the strategy
execution process

A culture

where attitudes
and behaviors impede
good strategy execution is a
huge obstacle to be overcome
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Fig. 13.1: Changing a Problem Culture

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Grounding the Culture in

Core Values and Ethics
A culture

based on ethical principles is

vital to long-term strategic success

Ethics

programs help make

ethical conduct a way of life

Executives

Our ethics
program
consists of . . .

must provide genuine support

of personnel displaying ethical standards
in conducting the companys business

Value

statements serve as a
cornerstone for culture-building
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Fig. 13.2: The Two Culture-Building Roles of a

Companys Core Values and Ethical Standards

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Fig. 13.3: The Benefits of Cultural Norms Strongly

Grounded in Core Values and Ethical Principles

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Establishing a Strategy-Culture Fit in

Multinational and Global Companies

Institute training programs to

Communicate the meaning of core values and
Explain the case for common operating
principles and practices

Create a cultural climate where the norm is to

Adopt best practices
Use common work procedures
Pursue operating excellence

Give local managers

Flexibility to modify people management
approaches or operating styles
Discretion to use different motivational and compensation
incentives to induce personnel to practice desired behaviors

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Role #1: Stay on Top of Whats Happening

Develop

a broad network of formal

and informal sources of information

Talk
Be

with many people at all levels

an avid practitioner of MBWA

Observe situation firsthand

Monitor
Get

operating results regularly

feedback from customers

Watch

competitive reactions of rivals

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Role #2: Put Constructive Pressure on

Company to Achieve Good Results
Successful

leaders spend time

Mobilizing organizational energy behind

Good strategy execution and

Operating excellence

Nurturing a results-oriented work climate

Promoting certain enabling cultural drivers

Strong sense of involvement on part of company personnel

Emphasis on individual initiative and creativity

Respect for contributions of individuals and groups

Pride in doing things right

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Role #3: Promote Stronger Core

Competencies and Capabilities
Top

management intervention is
required to establish better or new

Resource strengths and competencies

Competitive capabilities

Senior

managers must lead the effort because

Competencies reside in combined

efforts of different work groups and
departments, thus requiring
cross-functional collaboration
Stronger competencies and capabilities
can lead to a competitive edge over rivals
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Role #4: Display Ethics Leadership and

Lead Social Responsibility Initiatives
Set

an excellent example in

Displaying ethical behaviors

Demonstrating character and

personal integrity in actions and decisions

Declare

support of companys ethics code

and expect all employees to conduct
themselves in an ethical fashion

Encourage

compliance and establish tough

consequences for unethical behavior

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Our ethics
code is . . .

 Requires

deciding

When
adjustments
are needed
Role
#5: Lead
the Process of
What
adjustments
to make
Making
Corrective
Adjustments

Involves

Adjusting long-term direction, objectives, and strategy on

an as-needed basis in response to unfolding events and
changing circumstances
Promoting fresh initiatives to bring internal activities and
behavior into better alignment with strategy
Making changes to pick up the pace when results fall
short of performance targets
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