I have a question for you

By Sylvia Doyle, Director of Reward First  ® People Consulting

Having recently passed the Gregorian New Year and before we start the Chinese New Year of the Horse is the perfect time to shape the year ahead with the benefit of 2013 hindsight. This also coincides with a recent mentoring discussion which touched upon total reward and draws me back to the perennial question of the relative importance of culture v strategy. The infamous Peter Drucker has become immortalised by the ‘culture eats strategy for breakfast’ quote made famous by the then President of Ford, Mark Fields back in 2006. However as HR and reward professionals can this question help us in shape the sort of workplaces we want to be associated with?

So before I ask you a question, some points I would like to consider are:

  • Defining culture and strategy – It is easy to make assumptions on what these mean though one of my favourite interpretations comes from the previous CEO and founder of South West Airlines, Herb Kelleher as “When Napoleon was in Paris with all his Generals, around a table, discussing on how to attack Russia, that is strategy. But what makes 1,000,000 men march to Moscow, that is culture!" United Airlines who famously lost share price and reputation in 2009 for their treatment of musician Dave Carroll’s guitar after a year of battling compensation when he went to YouTube understood the full impact of this. 
  • Linking culture and strategy to reward - As HR and reward professionals, it should be second nature that people and reward management strategy and practices are developed and aligned to the culture and strategy. However some organisations ‘get stuck’ in articulating or redefining their values – the outcomes which can range from, on one end being consigned to the ranks of a cosmetic branding exercise while the most successful ones reflect and reinforce the ‘how’ behaviours of culture with the ‘what’ aspects of moving the business plan forward. 
  • Great workplace culture – While there are some great examples I am a big fan of the US retailer Nordstrom (not currently operating in the UK) whose customer service is second to none and where ‘the customer is always right’ genuinely means something, well quite a lot actually. Then you look at their ‘rules’: Rule #1: Use best judgment in all situations. There will be no additional rules.” While some inevitable clichés as ‘hiring the smile and training the skill’ exist it is reinforced by what Nordstrom does in practice. For example their organisational design uses the inverted pyramid with executives at the bottom and customers and employees at the top. So staff actually ‘get’ what the culture means to them on the ground. As you will gather their strategy also stands up to scrutiny.
  • Making organisational change work – As companies navigate large scale change, we understand the importance of getting the strategy piece right. I believe that business strategy and tangible rewards such as salary or total cash have at least one common attribute - they can be replicated and possibly even enhanced by competitors. On top of this, since staff will generally not buy-into change that they have not been part of shaping, involving staff is critical to achieve successful change. Reward change is no exception. Culture is akin to the DNA of the organisation, the piece that is virtually impossible to replicate and which can help organisations weather the change and produce a legacy we can be proud of.  Nordstrom’s responsibility of ‘leaving it better than we found it’ is a simple example of meaningful social responsibility.

So as we enter the Year of the Horse my question to you is:
How do you use reward to help reinforce your culture and strategy?
 

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  • Sylvia - this is a great question and stimulates "food for thought" across a number of disciplines. The examples of best (and poor) practice help us to recognise key drivers for positive change and meaningful competitive differentiation. The Telegraph recently reported on "toxic" culture at npower as being at the root of some of their recent customer service difficulties - ignoring the cultural context can have enormous impact.Thank you!

  • Anonymous
    Anonymous

    Great question Sylvia !

    I argue that being practical is paramount in these situations. Understand what the business is really trying to achieve, identify gaps and try to fill some of them through the design of your Reward plans. I share 4 real-life examples on the post I wrote as a response to your question here :

    compensationinsider.com/how-reward-reinforces-your-culture-and-strategy-4-examples