Why is it important to make a connection between strategy and corporate culture?
You must start with a new set of directions, and then you must help the culture move toward executing the strategy. [The corporation] won’t move unless it sees the vitality and intellectual underpinning of the strategy. People said, why doesn’t IBM change? It wasn’t for lack of strategy. It wasn’t for lack of exhortation on the part of the leadership saying, “We’ve got to change.” Nothing happened. The culture didn’t want to change. It didn’t buy into the strategy. The culture, which is made up of all kinds of practices and behaviors in the institution, fought the change. So what you have to do is go in and change all the processes that underlie cultural behavior. We changed the compensation system. We changed the organization system. We said, it doesn’t matter any more what your unit does, the whole company has to succeed before you get any payoff. Q: Did you change the IBM culture as much as you expected, and do you think it could slide back into its old ways? A: We have fundamentall
