11
Culture Eats Eggs and Strategy Eats Bacon, or Something to that Effect

For a long time, I thought culture was some flowery BS spewed by HR types. After all, we were engineers; we did real work. The truth is, I really didn't understand what culture meant.

Culture describes the “norms” of a group. A strong culture can also be an unhealthy culture. See Figure 11.1 to perform a culture evaluation for both your company and your IT department, separately.

Figure 11.1 Culture Evaluation Matrix

If there is a weak, unhealthy culture (bottom left), you will have high turnover, low productivity, and no discretionary effort. New hires will be discouraged from day one, and top talent will leave even for equal or lower pay. The only way to stay staffed is to overpay to the market. Paying above industry rates for disengaged employees is a recipe for failure. The term golden handcuffs is often associated with this scenario. Salaried professionals will behave like hourly workers, starting and stopping according to the clock, not the status of the work. If you have a team of people who always leave the office precisely at 5:00 p.m., you have an unhealthy culture.

Fortunately, I've never been to prison. However, I think of prison when describing a strong, unhealthy culture (bottom right). A high school cafeteria is another one. These are not the places where unique ideas shine through. How you line up, where you sit, and what is discussed are all dictated to you by the culture. These cultures were formed by people who aren't even there anymore. The seniors control the high school culture, and when they graduate, a new group is matriculated to do the exact same thing. This can go on for generations. It's been decades since I’ve stepped foot into my high school, but I wouldn't be surprised if some of the culture I remember still exists today.

In a weak, healthy culture (top left), while a company has healthy behaviors, they vary from group to group. If your company has more than one location, each one can develop its own culture. An Agile development team may have loose rules about working hours, while other employees follow a strict schedule. Some teams may converse loudly in the aisles, while a group on a different floor is library quiet. I worked in a building where the 7th floor was a party and the 15th floor was a funeral. This could mean you are overdressed on one floor and underdressed on another. Do you have a suit jacket on the back of your door for your trip to mahogany row? That's an example of a company with multiple disparate cultures.

The problem with siloed cultures is that almost all meaningful initiatives require cross-functional collaboration to be successful. For example, to run a successful eCommerce business, you need constant collaboration with Marketing, IT, Supply Chain, Store Operations, and Finance. If all of these groups have different expectations and working styles, it becomes next to impossible and extremely stressful to coordinate across the organization.

A strong, healthy culture is what I witness at Vitamin Shoppe headquarters right now (top right). People are enthusiastic about the work. There is clarity of vision. People go out of their way to help others. Conflicts are debated openly and politely. Our culture is strong, and we see the benefit in positive business results.

This begs the question: Are we winning because we have a great culture, or do we have a great culture because we are winning? It's a bit of both.

You can see this clearly in sports. Winning teams have an us-against-the-world swagger about them. They get the taste of success, and it drives them to work even harder, to support and push each other. They voluntarily get up early to work out and stay late to watch the game film.

Conversely, losing teams play the blame game. In business and sports, leaders often tighten the screws when results are poor. Coach of a losing team: “Go run laps.” Manager of a losing team: “Be here at 7:00 a.m. on Saturday.”

Here's the bad news: if you try to build an amazing IT culture in a company with an unhealthy culture, it may backfire. In the heyday of the tech boom, companies found it harder and harder to compete for tech talent. Companies like Google and Facebook provided free meals, beer on tap, volleyball pits, and all-you-can-eat M&Ms. I went to a briefing at Microsoft, and there was a cooler full of free Mountain Dew. Free! As a lifelong retailer, lucky to get a free swill of coffee, these perks astonished me.

Many legacy companies decided to mimic these concepts for their IT Departments. Companies installed basketball hoops, ping pong tables, and foosball.

The Wrong Way to Develop Culture

When discussing IT culture, a colleague told me that at TJ Maxx, the IT Department wanted to wear jeans and have more relaxed working hours than the rest of the company. The solution: the company moved IT to a different building.

This story made me cringe: IT volunteered to leave so it could have its own culture. I'm not surprised the company allowed it, since the competition for tech talent is fierce. If jeans and less formal digs help you retain top talent, it seems like an easy trade-off. My guess is that IT was moved to a lower-rent office, saving money in the short term and freeing up space for a revenue-driving function to expand.

While wearing jeans is nice, moving out is a horrible idea. A disconnected IT Department will quickly become more insular, more formal, and less aligned to the corporate goals and culture. Over time, the department will be considered less valuable: a cost and ripe for outsourcing. How does the story end? A quick Google search reveals the unfortunate answer:

TJX Lays Off Hundreds of Employees in IT Restructuring… . as part of this restructuring, certain services will transition to a third-party provider. – HFN Digital, May 17, 2018

That headline didn't surprise me. For more on my anti-outsourcing opinion, see Chapter 46, “What's Wrong with Outsourcing?”

Building a Strong Culture

When I was interviewing for my CIO role at Pier 1 Imports, I heard a lot about how bad the IT Department was. The consistent theme was that Pier 1 Imports had a unique and special culture, except for IT, which had its own, not-so-wonderful culture. When I asked for an example, the answer was Halloween. Halloween wasn't just another holiday at Pier 1 Imports; it was an event. Costume contests were team efforts, and you didn't just dress up—performance theater was involved. To this day, people still talk about the Finance team's production of Grease.

The IT Department didn't participate in Halloween. At all. They had a “culture,” but it wasn't in sync with the rest of the company, so there was no connection between IT and everyone else.

I started my job in August, with just two months to fix the Halloween problem. The conversation went something like this:

• Me: “Why don't we compete at Halloween?”
• IT Director 1: “We're too busy.”
• IT Director 2: “Our projects are behind; it would look bad.”
• IT Director 3: “Tech people are introverts. They won't enjoy it.”

While all of these sounded reasonable, that didn't matter. Everyone was busy. Our projects were so behind, spending a few days making costumes wouldn't make a difference. And while techies may be introverts, we are also extremely creative and competitive—the perfect skillsets for a costume contest. We went for it. That year, we competed and got an honorable mention. Year two was a tightly contested second place, and in year three, we not only participated, we won Halloween!

My first action as the head of a large IT Department was to convince them to dress up in costumes.

How Can a CIO Influence Culture?

If you find yourself in the same position I did at Pier 1 Imports, with a healthy corporate culture and an unhealthy IT culture, the fix is simple: embrace the corporate culture and align IT to the rest of the business. If you're at a company with a weak culture or, worse yet, an entrenched, unhealthy culture, your only chance at success is to change the entire company's culture. While this may sound daunting, it must be done.

Fixing IT's culture while leaving the rest of the company behind is a fool's errand. I once believed I could create a beautiful IT culture, and the rest of the company would follow. It doesn't work that way. Purposefully changing IT's culture in a vacuum causes less alignment, more strife, and jealousy from other groups.

Partner with your peers, your CEO, and especially your CPO to create a vision and a roadmap to improve the culture for everyone. This is where you need to remove your CIO hat and put on your corporate executive hat. Can a CIO become the leader who improves corporate culture? Why not? That's what good leaders do.

The Blue Bloods

In college football, there is a select group of teams known as the blue bloods: the royalty of college football. Teams like USC, Oklahoma, Ohio State, and Alabama are commonly included in this list. These teams outperform year after year, decade after decade. What makes them consistently great? Is it the coach? No, they all have had success under multiple coaches. Is it the players? No, the players rotate out every four years. What these teams have is a culture of success. A culture of winning. The best coaches are attracted to these programs. The best players are attracted to these coaches. The culture of commitment, dedication, and hard work is passed from upperclassmen to freshmen. The culture supersedes any one person. This should be your goal. Create a winning culture, and you'll build a blue blood IT Department that continues to win long after you've gone out to pasture.

Peter Drucker, a well-known management consultant, educator, and author, is often credited with the popular quote that “culture eats strategy for breakfast.” And while sources debate about whether or not it was Drucker who actually used those exact words, the meaning is not often the subject of dispute: a leader could have a solid strategy and a great team, but if the culture won’t allow anyone to win, the fruits of success wither and die on the vine.

With a clear vision, a written strategy, and, importantly, a winning culture, the building blocks required for an Amazing IT Department are starting to take shape. In the next chapter, we'll discuss setting up the optimal IT organization structure for your company.