Corporate culture

Corporate Culture

Executives are often confounded by culture, because much of it is anchored in unspoken behaviours, mindsets, and social patterns.

But when properly managed, culture can help them achieve change and build organisations that will thrive in even the most trying times.

There are as many as eight distinct culture styles:

Caring – focused on relationships and mutual trust.

Purpose – exemplified by idealism and altruism.

Learning – characterised by exploration, expansiveness, and creativity.

Enjoyment – expressed through fun and excitement.

Results – characterised by achievement and winning.

Authority – defined by strength, decisiveness, and boldness.

Safety – defined by planning, caution, and preparedness.

And Order – focused on respect, structure, and shared norms.

These styles fit into an “integrated culture framework” according to the degree to which they reflect independence or interdependence (people interactions) and flexibility or stability (response to change).

They can be used to diagnose a culture and to model how likely an individual leader is to align with and shape it.

Here are five insights regarding culture’s effect on companies’ success:

(1) When aligned with strategy and leadership, a strong culture drives positive organisational outcomes.

(2) Selecting or developing leaders for the future requires a forward-looking strategy and culture.

(3) In a merger, designing a new culture based on complementary strengths can speed up integration and create more value over time.

(4) In a dynamic, uncertain environment, in which organisations must be more agile, learning gains importance.

(5) A strong culture can be a significant liability when it is misaligned with strategy.

Culture and strategy are entwined, they are opposite sides of the same coin, both in balance, one supporting the other.

Mergers

Buying Companies For Talent

CEOs are weighing whether to buy other companies to solve their hiring woes.

Driving the news: A third of executives surveyed in a new KPMG report say they want to use mergers and acquisitions to acquire talent in 2022.

The big picture: 2021 was a record-breaking year for M&A and 2022 could top even that. And M&A can be a quick way to bring in new talent as companies navigate the Great Resignation.

What they’re saying: “We’re all experiencing this shortage of job seekers,” says Philip Isom, global head of M&A at KPMG. So, companies that might have tried to grow organically in different times are instead considering acquiring other firms as a quicker solution to their recruitment problems, he says.

But: It’s not always easy to retain employees after a merger or acquisition.

  • Firms may have to offer incentive packages to hang onto top talent post-M&A.
  • And it’s not just about higher pay. Employees are focused on health care, flexibility in our new age of hybrid work, and benefits. “Childcare especially has become a sticking point for working parents,”.

Culture fit and chemistry inevitably determine the length of tenure post-merger.

Metaverse

Brands Race Toward Metaverse

Companies are rushing to build for a metaverse, even as consumers are still trying to understand the concept. 

Driving the news: Nike just acquired RTFKT, a developer of digital goods, including virtual sneakers and NFTs (non-fungible tokens). Meanwhile, Applebee’s is launching a new NFT every Monday this month, following White Castle’s move into crypto.

Why it matters: Virtual and mixed environments are expected to upend businesses the way the internet did, industry watchers say.

  • The way they evolve “has the potential to disrupt almost everything in human life,” analysts at Jefferies wrote.

Be smart: The metaverse concept has been around for decades. Several different kinds already exist — think Roblox, Minecraft, Fortnite, Decentraland and The Sandbox. 

While Facebook’s pivot to Meta has increased media attention, huge brands from Gucci to Taco Bell have been experimenting with digital product launches all year. 

  • At Nike, the bet is that people will want to buy digital goods for their digital personas.
  • For Applebee’s foray, the sale of an NFT is an example of how the real and digital worlds can be bridged. 

What they’re saying: Companies are speeding to the finish line because “there’s the first-mover advantage for the buzz … signalling to a very valuable audience that you’re a brand that gets it,” says Robert Davis, head of innovation at Ogilvy. 

  • The other part of the rush: inflation. It’s already getting incredibly expensive to lock down market share on things like virtual real estate.

What to watch: Adoption is still low. Less than 20% of the U.S. population will have used virtual reality at least once per month this year, according to eMarketer.