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To clarify, strategic or organizational alignment, as we described in earlier work, consists in compatibility between all three paths, and consistency within them – the values held in the organization should be compatible with strategic goals; people’s day-to-day behaviors should be consistent with the values that they and the organization espouse; the infrastructure of the organization should support all. We should make it clear that we are talking about values around how the organization conducts its business – not people’s personal values about home, family, religion, or personal relationships.
Organizations have traditionally emphasized the strategic path. Considerable time and effort often go into defining strategic goals and objectives. Comparatively few organizations have explicitly addressed the cultural path with clearly defined, published statements of values — and fewer have made the effort to examine and support the practices and behaviors that represent those values. Yet our behavior patterns- the way we do things- are just as important as our activities what we do in determining the results we achieve.
The biggest misalignment usually occurs in organizations around the infrastructure as shown to the right. The strategic and cultural paths appear compatible and mutually supportive but internal systems such as policies, training, appraisals, rewards and recognition go counter to what is needed. People behave and subsequently, perform the way they do within organizations because of the influence of these three major directional forces: strategy, culture and infrastructure.
Both strategies and values provide important direction and contribute to organizational success. In recent years, with increasing competition and decreasing differences among many organizations in their technology and products, the “values side” of the model the side most strongly associated with the culture of the organization has assumed a greater role. We are now seeing more emphasis on infrastructure.
There was a time when strategic alignment was an unknown and not until fairly recently has it become more commonly heard in business conversations. Vector Group principals were pioneers in developing this concept based on early work at British Airways in the mid- to late 1980s. In transforming the airline great attention on the BA culture, encompassing the collective behavior of its organizational members, led to strong conclusions about the impact of that behavior on the success of that particular enterprise.
Deal and Kennedy’s book, Corporate Cultures, was first published in 1982 focusing primarily on describing elements of organizational culture and the rights and rituals of corporate life. This book was the first to draw together bits of pieces scattered throughout the business literature describing values and behaviors found in organizations.
Vector Group principals took theory and built practical applications within a number of organizations that led to highly successful turnaround situations including British Airways and others. Our initial work regarding organizational culture goes back to 1983 when we focused on organizational values at BA.