So, what exactly is “business culture?” A quick search will produce definitions that include concepts such as beliefs, behaviors, values, missions, employee-management interactions, and the qualities that seek to define a unique corporate identity. All valid, but not very helpful in assessing the fit of your business culture to advance company goals.  

Interestingly, a Deloitte study found that nearly all executives (94%) “believe a distinct workplace culture is important to business success.” Yet, “a higher percentage of executives identified “a clearly defined business strategy” rather than core values and beliefs (76% vs. 62%) as substantially contributing to success.ⁱ  

This is a limiting disconnect (and likely why so many corporate ethics, code of conduct policies, and mission statements are papered but not practiced).

Successful strategies are dependent upon a culture that supports those strategies. What is missing in the many mostly similar definitions of business culture is the core foundational component: a shared vision.

If people do not share a common vision, and do not share common ‘mental models’ about the business reality within which they operate, empowering people will only increase organizational stress and the burden of management to maintain coherence and direction.
—Peter Sengeⁱⁱ

It is a shared vision that creates the necessary alignment across the organization’s employees (skills acquisition and behaviors) and systems (technologies and processes) needed to achieve strategic objectives.  Absent a shared vision of where you are and where you need to be, any attempts at transformational growth – digital or otherwise – will only create chaos.  

As we noted here, Assessing and planning for a digit transformation – the critical first step in any digital strategy – should establish performance measures and anticipated outcomes across four key areas:

1. Business Environment
2. Business Culture
3. Business Processes
4. Enterprise Architecture

In this post, we focus on the vital role of business culture in successful digital transformational strategy and execution.

Does your business culture support future readiness?

Change has always been the one constant on which we can rely. But today, it is not simply about managing change, but rather, managing the velocity of change that technological advancements continue to accelerate. Meeting this challenge requires a workforce with continually evolving skills and behaviors, and who are permitted – encouraged – to work in new ways.

Acquiring new skills and shifts in behavior are vital to producing the outcomes anticipated by digital transformation strategies. As new technologies, new processes, and new data flows are introduced, new ways of working to exploit their benefits are required.

Achieving this requires continuous learning and knowledge creation as a fundamental principle, behavior, and outcome of business culture. It is the distinguishing characteristic of the most successful innovators.

In an economy where the only certainty is uncertainty, one sure source of lasting competitive advantage is knowledge. When markets shift, technologies proliferate, competitors multiply, and products become obsolete almost overnight, successful companies are those that consistently create new knowledge, disseminate it widely throughout the organization, and quickly embody it in new technologies and products.
—Ikujiro Nonakaⁱⁱⁱ

In other words, improving processes, implementing artificial intelligence, harmonizing your cyber-physical ecosystem, building digital twins, and other digital transformation strategies without a culture (in practice) that supports new mental models, behavioral shifts, and skills development, will see these technology investments go to waste.

While these impressive technologies and processes offer increased access to valuable data, it is the corporate culture that will most impact the organization's ability to create new knowledge, act on it quickly, and effectively create new value for its customers. and maintain competitive advantage.

Technology is enabler only. T42 understands that when it comes to digital strategy:

• People turn data into insight.
• People convert strategy to action.
• People navigate change, risks, and opportunities.
• People discover new opportunities and exploit them to the benefit of the organization.
• People create value.
• People have vision.

McKinsey & Company found that business culture is a key determinant of digital transformation strategy success.

Is your business culture transformation ready?^iv

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About Transform 42 Inc.

T42 is a digital transformation specialist relentlessly focused on delivering targeted, measurable, and sustainable outcomes against clearly defined success metrics. Deploying a people-first strategy, we implement tooling, modernization, and process enhancement that enable people to interpret, develop insights, and act on that data to better serve the business and its customers.

T42 partners with our clients to design and implement digital strategies that survive growth and change.

ⁱ Core beliefs and culture, Chairman’s survey findings.
ⁱⁱ The Fifth Discipline: The Art & Practice of The Learning Organization
ⁱⁱⁱ The Knowledge-Creating Company (See also here.)
^iv Unlocking success in digital transformations

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