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Culture Eats Strategy For Breakfast. So What's For Lunch?

Andrew Cave

There's a debate online about whether the late management guru Peter Drucker ever actually said: "Culture eats strategy for breakfast."

However, the phrase was attributed to him in 2006 by Mark Fields, who later became chief executive of motor giant Ford, and 11 years on it is gaining new currency as part of the movement for purpose-led business.

Drucker certainly believed that a company's culture normally thwarts any attempt to create or enforce a strategy that is incompatible with that culture.

His alleged phrase, which doesn't seem to appear in any of his 39 books, has passed into corporate-speak and is oft-referred to by management consultants.

Lip Service

Yet boards appear to be paying only lip service to Drucker's tenet, according to a new survey by tax and accountancy firm Mazars, the INSEAD business school in Paris and Board Agenda magazine.

The study found that, despite culture being in the top three priorities for company boards, only 20% of 450 London-based directors and board members reported spending the time required to manage and improve it.

Some 62% of survey respondents felt that they were primarily responsible for setting culture from the top of an organisation.

However, a similar proportion (63%) either did not consider culture as part of their formal risk assessment or failed to routinely consider the risk associated with their corporate culture.

Only a quarter of boards said that they undertake an internal or external audit of their culture.

The remaining three-quarters rely upon sources such as employee feedback, customer surveys and risk events such as rule breaches, human resources issues and the monitoring of compliance.

Far less attention is paid to external sources of information such as social media and press commentary, the study found.

Entitled "Board Leadership in Corporate Culture," the report was conducted among chief executives, chief finance officers, chairmen, directors, company secretaries, risk officers and investment managers earlier this year.

Some 67% of respondents worked for public companies in the U.K. and mainland Europe.


The study claims to be the first survey of its kind to measure how effective boards and directors across Europe are at leading and managing corporate culture.

It shows that the importance of corporate culture is now widely recognized by boards, but that translating this understanding into focused action remains a challenge.

Boards need reliable information on the actual culture of the business so that they can be clear on how they are going to close any gaps between that and their desired culture, the report concludes.

Even if boards are thinking more about corporate culture, there does appear to be a discrepancy between what directors are thinking and what happens in practice.

This gap that needs to be bridged if leaders are to maintain or restore public trust in their businesses.

Since building a structure for the long-term success and sustainability of a company is a board matter, ought to be a key responsibility of any board, a first step should be to address the culture of the board itself.

States David Herbinet, Mazars' global head of audit: “Many years after Peter Drucker’s famous quote, it does seem that more boards are coming around to the idea that culture may indeed eat strategy for breakfast.

"Much work, however, remains to be done by boards to fully grasp this lesson and use it effectively in decision-making and for investors to properly assess it for the long term benefit of companies, their stakeholders and wider society."


Instituting such a recognition will not be easy but it does start with a unified and clear vision of what an organisation is basically for and what it is trying to achieve.

The purpose movement gets accused of being a recession-induced fad, while companies that are suspected of being insincere about their commitment to purposeful agenda are accused of the new corporate crime of "purpose-washing".

Culture, however, can take decades to build and mere moments to disappear when management is distracted and takes its eyes off what an organisation is really about.

As John O'Brien, head of purpose at PR agency Porter Novelli and my co-author on The Power of Purpose is fond of saying: "Culture eats strategy for breakfast but culture gets its appetite from purpose."

And no. Peter Drucker probably didn't say that either.

