Culture Strategy: What Culture Does Your Business Need?

By Joe Newsum

The Most Discounted Strategy in Business

Culture strategy has always been discounted. In most companies it gets subbed out to the HR team, a values refresh here, an engagement survey there, a poster in the lobby, while the strategies that command the executive team’s full attention, market strategy, product strategy, pricing, M&A, get the frameworks, the rigor, and the offsites. And yet culture strategy is one of the most important strategies a company will ever develop and execute, because every other strategy is executed through it. Your market strategy is carried out by hundreds or thousands of people making daily decisions you will never see. How they think and behave in those moments is not a soft topic. It is the execution layer of everything else you have planned.

The discounting is not because leaders think culture is unimportant. Everyone can quote the famous line, culture eats strategy for breakfast, and then they hand culture to HR anyway. The real reason is that culture strategy never had a toolkit. Strategy got Porter, core competencies, and scenario planning, generations of instruments for being intentional. Culture got adjectives. And without instruments, even leaders who care deeply end up doing the only thing available: picking admirable words, putting them on a wall, and hoping a feeling shows up. A feeling cannot be installed. It is an output of what you build.

That toolkit is what Culture by Commitment brings, and this page is the master plan for using it. You get super intentional about the culture your company actually needs, derived from your True North and the behaviors your strategy requires. Then a full language of commitments drives the right thinking in the moments that matter, the thinking drives the right behaviors, and over time the cumulative effect of how everyone thinks and behaves compounds into something your competitors cannot copy: a strategic advantage that drives fundamental performance and excellence. That is culture strategy done as strategy, and here is what it is made of.

The Eight Towers of Culture: Universal Strengths, Strategy-Set Meanings

Start with what is universal. There is a short list of cultural strengths that pass a simple test: would any organization, anywhere, running any strategy, be better with more of it? I think of them as the Eight Towers of Culture, because every company builds all eight to some height, whether it knows it or not. No company was ever harmed by building any of these taller. That is what makes them the towers, and it is also why they are not, by themselves, a culture strategy. A list everyone should build tells you nothing about what your business should build first, highest, and in what form. The eight: a culture of candor, of ownership, of accountability, of excellence, of growth, of curiosity, of care, and of customer.

Because here is the part that almost everyone misses: a tower in the abstract is a word, and a tower inside a strategy is a practice. Take candor and watch it change shape three times. At Netflix, candor means sunshining your mistakes, openly dissecting your own failed bets, because the company wins on talent-dense original content, which demands judgment-heavy creative decisions made fast, and a hidden mistake corrupts the next hundred bets. At Toyota, candor means the andon cord, where any worker on the line can stop the entire factory to flag a defect, and management thanks them, because the company wins on quality at mass-market cost, which demands that problems surface the moment they exist. At McKinsey, candor meant the obligation to dissent, where staying silent in disagreement violated a professional obligation, because the firm sold counsel worth millions and an unspoken doubt could ride a recommendation all the way into a client’s operations. Same tower. Three completely different buildings. Each one correct, and none of them transplantable, because the form of the tower comes from the strategy it serves. Which is also why copying the culture of your industry’s most admired company, while running a different strategy, builds the wrong thing beautifully. What gets copied is always the forms, the famous memo, the published principles, and a form without the strategy that made it correct is theater your people can smell in a week.

And once you have the towers, you can map any company with them, and the map talks. Sketch the profile of any business you know, which towers are tall, which sit short, and you can predict how the place feels to work in, what its reviews complain about, and where it will break under pressure. I have run the exercise on company after company, Amazon and Toyota, Netflix and Ritz-Carlton, Walmart and Nvidia, and the rule has not missed yet: tell me the tallest towers and the shortest one, and I will tell you the culture. Every famous culture you admire, and every infamous one you have suffered, is just a profile on these eight.

Two winning profiles, drawn by two different strategies. Map any company this way and the profile talks.

The Method: From True North to the Culture You Need

I have developed culture strategy with companies of every type and size, from PE-backed distributors to Fortune 500 insurers, and we always start in the same place, higher up than most culture conversations ever go. The method runs in six steps.

The totality of a culture strategy: the commitment stack drives to threshold concentration, and the system keeps every layer moving.

Step One: Start at Your True North

What is your mission, the reason the company exists? What is your vision, the place you are actually trying to reach? Culture serves these or it serves nothing, which is why the True North comes first in everything I build. A culture derived without it is decoration. And in practice the True North usually needs sharpening before the culture work can begin. Sometimes getting it sharp becomes a full strategy project of its own, and that is not a detour, because a culture built on a fuzzy True North inherits the fuzz.

Step Two: Pinpoint Your Advantage, and the Capabilities Behind It

Next, get to the heart of where your competitive advantage actually comes from, and resist the urge to make it one word. Do you win on cost? On speed? On product superiority, service intimacy, network effects, brand trust, distribution reach, or the pace of your innovation? Most companies win on a specific combination, and the lead​ership team should be able to write it out in a few crisp sentences: where we win, with whom, and why customers keep choosing us. If the team cannot agree on those sentences, stop here, because you have a strategy problem wearing a culture costume, and no amount of culture work will fix it.

Then go one layer down to the capabilities: for each element of the advantage, what must you be operationally great at for it to stay true? These are your core competencies, and I use that term with some affection, because I helped stand up the Management Innovation Lab with Gary Hamel, who with C.K. Prahalad gave business the idea. Their insight was that advantage does not live in products, it lives in the deep capabilities underneath them. And capabilities are not built by machines. They are built by people behaving a certain way, thousands of times a week, which is exactly where culture enters the strategy.

Step Three: Build the Behavior Portfolio with the Scenario Exercise

Now the step almost every culture conversation skips, and it is where the derivation becomes real: what behaviors need to dominate your culture for those capabilities to be inevitable? The honest way to answer is not with adjectives. It is with scenarios. We pull concrete moments from across the functions and from high and deep in the organization, the moments where your strategy is actually decided, put them in front of the management team, and ask one question about each: what is the ideal behavior here, for our strategy? Not the admirable behavior in general. The ideal behavior for the way we win.

Run five or six of these and watch what happens in the room. The abstract agreement dissolves, the real tradeoffs surface, and the team is forced to make the calls that define the culture, one concrete moment at a time. The answers are your dominant behaviors. And notice what else just happened: the scenarios your strategy makes hardest are exactly where your culture will be decided, whether you decide it or not.

We then workshop those scenarios with the lead​ership team until there is genuine alignment on the ideal behaviors, and here is the part nobody expects: the workshop is worth running for its own sake. There is no faster way to surface that five executives would answer the same moment five different ways, which means their teams are currently living in five different companies. Arguing from five answers down to one produces more alignment and clarity than a quarter of offsites, and the culture strategy inherits every bit of it.

Step Four: Name the Towers Those Behaviors Build

Cluster the dominant behaviors and they resolve into towers, heights, and forms. Southwest’s scenario answers, mobilize at the gate, everyone hauls bags, protect the turnaround, cluster into customer, care, and ownership built tall, with ownership taking the form of the plane belonging to everyone on the tarmac. McKinsey’s answers, dissent now, send the deck back, the client’s problem is yours, cluster into excellence and accountability as skyscrapers, with candor in the form of the obligation to dissent. Netflix’s answers cluster into candor and accountability, with candor taking the form they call sunshining: openly dissecting your own mistakes and failed bets in front of your peers, because in a business of judgment-heavy creative calls, a hidden mistake quietly corrupts the next hundred. Netflix even wrote its profile down: the famous culture deck was never a description of a culture that existed, it was an architectural drawing of one they intended to build. The scenario answers are not illustrations of the towers. They are the towers, in their native form, and they hand you the raw material for the commitments that will build them.

Step Five: Create the Core Commitments, Under the Umbrella of the True North

With the behavior portfolio agreed, we map the behaviors to their towers and distill them into core commitments: the three to five enterprise-wide promises about how everyone behaves, regardless of team or title, worded sharply enough to be invoked in a real meeting. Speak the truth with respect. We own it. These are not values on a wall. They are kept promises with language people actually use, and choosing and wording them is a craft of its own, which I go deep on in how to design core commitments. One rule governs the choosing: strategy sets your spikes, and health sets your floors. Your competencies pick the two or three towers to build above everyone else’s, but no tower can be allowed to collapse, because where candor and accountability fall below their floors, politics metastasizes through the organization, and rebuilding a breached floor comes before raising any spike.

Step Six: Build the Reinforcement System, and Drive to Threshold Concentration

Core commitments set the enterprise standard, and then they cascade. Operating commitments translate them into how each specific team runs: the working agreements a lead​ership team, a sales floor, or an engineering group makes about its own meetings, decisions, and ways of working. Activity commitments go one layer deeper, defining how a specific activity is done across the company: how meetings run, how feedback is given, how email works. Developed and rolled out team by team, in the specific forms your strategy demands, they take the culture from a lead​ership statement to a daily practice. And the rollout has a target with a name: threshold concentration, the point where enough people practice the commitments consistently enough that the culture tips and begins running itself. Two systems drive you there.

The Daily Levers

Three levers run every single day. Communication keeps the shared language everywhere the work happens, in the town halls and the one-on-ones, in the way work gets framed and the way wins get told. Leadership modeling makes the commitments visible, because people absorb a leader’s manner far faster than a leader’s memos, and every meeting a leader runs is a demonstration of whether the commitments are real. And open accountability gives the commitments teeth: anyone can hold anyone to them, regardless of rank, which is the moment a culture stops being top-down and starts being self-enforcing.

The People System

The deepest reinforcement is structural, the people system itself: you hire to the language, onboard in it, develop and review people in it, promote and reward on it, recognize it publicly, and organize around it, so every system that touches a person’s career speaks the same words. That was the machinery of the McKinsey loop: the language was the interview, the review, and the promotion. When the reviews, the rewards, and the org design all agree with the commitments, the culture stops being an initiative and becomes the operating system. That totality is how culture change sticks.

The end state is a global True North and core commitment narrative with a full strategy behind it: an intentional culture, designed by the lead​ership team rather than inherited by accident. People have, and constantly use, a shared language. The language drives consistency of thinking and mental models. The thinking drives the behaviors the company needs. The behaviors create the culture. And the culture drives the performance of the company.

The full construction methodology, from language to commitments to the culture they compound into, lives in Culture by Commitment. This page’s job is the step almost everyone skips: deciding what your business actually needs before you build anything.

Every Culture Is Either Derived or Inherited

So here is the whole page in one decision. Every company gets a culture. The only question is whether it is derived or inherited. Most are inherited: the residue of whoever got hired, whatever went unchallenged, and however the loudest leader happened to behave, and then everyone wonders why the strategy keeps stalling in execution. The alternative is the work on this page. Derive the behaviors you need to win from your True North, your advantage, and your capabilities. Commit to them in language people actually use, in the moments that actually matter. Reinforce them through the daily levers and the people system until the culture tips and runs itself. Do that, and culture stops being the soft topic subbed out to HR and becomes what it should have been all along: the execution layer of your strategy, and a compounding advantage your competitors cannot copy, with people rising to their potential, individually first, then together.

Read next: Culture by Commitment: the full methodology, or see a complete culture derivation in the wild in McKinsey Culture: An Alum on the Language That Built It.