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Article -> Fitting Corporate Culture into Strategy

Date Added: August 2005

A successful business strategy can help companies effectively execute and stay ahead of the competition. Maintaining strategic direction and relentlessly executing - rather than reacting to competitive conditions - is the most consistent route to success. Along with a successful strategy, a company needs to focus its culture and align it with employees.

Corporate culture should not be underestimated. Culture is composed of unspoken shared assumptions, beliefs, and values that differentiate from industry leaders from the followers. Culture is, for the most part, invisible. The success of culture is based on organizational leadership. Every company should have an "elevator story," telling employees and customers what the company represents, what services they have, and how they differentiate themselves in the market.

Employees are recruited and trained with the corporate culture in mind, so they will provide caring, personalized service to customers. Employees should have the skills to address needs in specific market segments. Employees are company "evangelists" and can clearly differentiate in customers' eyes.

Culture can affect behavior in a business market in many ways:

  • Companies that are highly social, and not aligned, show levels of practical cooperation to deliver satisfaction.
  • Companies that are not social, and have little communication, are very fragmented.
  • Companies without common goals will fall apart.
  • Companies dominated by one leader, with the rest following, tend to miss quick responses from employees.
  • Companies that are aligned when heading toward goals show greater success, not to mention higher employee satisfaction and levels of productivity.1

There are four business strategies that companies can implement to become more aligned with their target market. First Movers identify and exploit new product and market opportunities by offering innovative products or by viewing the market from a different perspective. These companies should employ an aggressive marketing strategy, yet be patient, because they are targeting innovators and early adopters. A Fast Follower strategy imitates and improves upon a First Mover (if successful), while maintaining a core of traditional products and customers. The market strategy should be proactive and competitive intelligence.

A Cost Effective strategy is a late entrant that engages in aggressive efforts to protect their market from competitors. This strategy seeks efficiency in many areas of the value chain, enabling it to offer a more cost-effective total solution. A Customer Specific strategy creates customer value by offering high quality products supported by superior service at lower investments than the First Mover, yet have higher investment than Fast Followers or Cost-Effectives.2

Aligning the right people in the right roles with the right strategy for your business will lead to organizational success.

1 Locander, William B. "Staying with the Flock." Marketing Management: March/April 2005: 52-54
2 Slater, Stanley F., Olson, Eric M., and G. Tomas M. Hult. "Proper Pairs." Marketing Management: March/April 2005: 23-28

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