When it comes to changing culture, think small

strategy+business, August 11, 2022

by Theodore Kinni


Illustration by PM Images

Effective leaders know that long-term corporate success requires a strong organizational culture that is well aligned with a company’s purpose and strategy. As Lou Gerstner wrote, describing the turnaround he orchestrated at IBM in the 1990s, “I came to see, in my time at IBM, that culture isn’t just one aspect of the game—it is the game.” Nevertheless, it remains commonplace for corporate transformations, mergers and acquisitions, and other large-scale initiatives to lose momentum after running headlong into cultural barriers. What gives?

This is a question that Roger Martin, a CEO advisor and the professor emeritus of strategic management at the University of Toronto’s Rotman School, has been mulling for 30 years. In his latest book, A New Way to Think: Your Guide to Superior Management Effectiveness, a compendium of his writings for the Harvard Business Review, he observes that leaders typically approach culture change in one of two indirect ways.

Most often, Martin told me in an interview, they attempt to change the culture by edict. “They say something like, ‘I’m CEO, and this is a very bureaucratic organization. Everything takes too long. This will be a nonbureaucratic company because I say so.’”

The other commonly used approach relies on structural changes, Martin explains. “The CEO says, ‘This place is bureaucratic because the finance department is overbearing. So, the CFO will now report to the COO, and the COO has a mandate to keep finance from getting involved in things in which it shouldn’t get involved.’”

Unfortunately, neither approach is powerful enough to successfully change an organizational culture on its own. “They don’t work, because they don’t change the shared interpretations and norms within an organization,” says Martin. “The truth about culture is that the only way you can change it is by changing the way individuals work with one another. If you can change that, then you will find the culture has changed.” Read the rest here.