Execs Need To Focus More On Culture

Here’s an excerpt from Bruce Nussbaum’s recent blog post on BusinessWeek called Chrysler, Culture and Cerberus:

The Obama Administration’s lead car guy, Steven Rattner, is a Wall Street investment banker who lives by numbers and it makes sense to him to basically give Chrysler to Fiat to save American jobs. But neither he, nor Nardelli nor President Obama understand that cars and car organizations are all about culture, not numbers.

In the post, Bruce poses the question of whether it’s more important to manage a business by the numbers or to manage the culture. Great question!

My take: I wrote a post about Bob Nardelli’s reign at Home Depot called Home Depot Still Has A Spark Of Customer Centricity which was a follow-on to a post that looked at how Frank Blake (who replaced Nardelli) was trying to rebuild Home Depot’s customer-centric culture. These represent a case study about the potential downfall of  “numbers-driven” management style.

Here’s the comment that I left on the BusinessWeek blog:

The problem is that you need to manage both; culture and numbers. Over the last few decades, however, executives have overdosed on the numbers. So it leads to situations where leaders like Nardelli sap the soul out of Home Depot because they don’t understand culture.

Times have changed, but management has not kept up. That’s why I wrote a mini book called “The 6 New Management Imperatives: Leadership Skills For A Radically Changed Business Environment.” The first imperative is: “Invest in culture as a corporate asset.”

The bottom line: Culture is an undermanaged asset.

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I'm an experience (XM) management catalyst; helping organizations improve results by engaging the hearts and minds of their employees, customers, and partners. I enjoy researching and speaking about leading-edge XM topics. I lead the Qualtrics XM Institute, which is the world's best job. We're igniting a global community of XM Professionals who are inspired and empowered to radically improve the human experience. To achieve this goal, my team focuses on thought leadership, training, and community building. My work is driven by a set of fundamental beliefs: 1) Everything starts and ends with human beings, so you need to understand how people think, feel, and behave; 2) XM is a discipline that needs to be woven throughout an organization's entire operating fabric; and 3) Building the XM discipline requires a combination of culture, competency, and technology.

2 thoughts on “Execs Need To Focus More On Culture”

  1. Bruce I agree that both have to be managed, unfortunately many executives do not understand what culture is let alone how to measure and manage it in the same way that they manage the numbers. We had a discussion with a client today about the impact their culture was having on their ability to deliver great customer service and meet the expectations that different customers had in different markets. Their challenge was they had two different cultures that had developed around different customer needs and they were trying to blend them with limited success.
    In this case a the first step is to uncover the cultural differences, surface them so people are aware of them and then work on solutions.

    1. Christopher: I’ve been so busy that I’ve neglected my commenting. Culture is such a mysterious concept to many executives. But I am getting more demand from clients to understand what it takes to create a customer-centric culture. So That’s a good sign. Thanks for sharing your thoughts.

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