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Consultant Galen McPherson
Culture, not Competition; Character, not Crisis
Mar 08, 2010
A recent study by McKinsey, completed within the last two months with over 1400 respondents, identified strategic capability building as among the top three priorities of more than 75% of the senior executives. At the same time, almost the same percentage felt that their companies were not good at building a capability that is strategically relevant. Now doesn’t that make you stop and wonder?
What are we missing here? There are the obvious “surface” issues such as being too close to the problem to be objective, having the day-to-day work competing [and winning] over future-focused adjustments, or any of the other top ten challenges mentioned in the report [link here]. But companies, and executives, have been at this “capability building” thing long enough that these factors should be much less important than they seem to be.
Then it hit me – out of this report, a solution appears that is considered more to be cause than effect. Companies, and executives, are seeking and making these changes, not in response to competitive pressures and to critical circumstances, but in search of a shift in culture and character, in basic values underlying the organization. Yet, the changes they are applying are in the area of processes and procedures, and not in foundational characteristics. Business processes, the tool that every company uses to bring value to their customer base, do not operate in a vacuum- they are instead immersed in an environment of culture and character that must be changed as well. Until the foundational characteristics are consciously and definitively realigned, the processes and procedures built upon these characteristics will have their potential effect diverted by them, returning to status quo ante.
A key factor in such an environment is a company’s knowledge system. As Deming would often chide: ‘How could they know? They were only doing their best.” Many companies are unaware that they have a knowledge system, but it drives everything that they do. Even those who are aware of their knowledge system are often unsure of how to approach it. People cannot do more or better than they know.
Managing one’s “Intellectual Capital” is becoming a more prevalent conversation among today’s business leaders, and it is one that will often decide the long-term viability of your organization. Intellectual Capital is as important to today’s business as oxygen is to life. It should be approached with no less diligence that our perpetual human struggle to breathe. And that becomes the real challenge, adjusting our knowledge systems to deliver the culture and character we seek. Strategically. Definitively. Deliberately. And most importantly, productively.