What Under Armour
And HBO Have In Common
Ten years of
innovation lesson : Culture eats strategy.
I was at an invite-only dinner in
the south of France, at a chateau overlooking the Mediterranean during the
Cannes Lions Advertising Festival. The lavish al fresco meal was cohosted by
talent house WME and ad agency Droga5, and it featured
short speeches from notable media figures: 21st Century Fox CEO James Murdoch,
model Chrissy Teigen, and HBO chief executive Richard Plepler, among others. I
was sitting across from Under Armour CEO Kevin Plank when HBO’s
Plepler addressed the group, stressing how at his company, "Culture eats
strategy for breakfast." Plank became agitated and began furiously tapping
away on his phone. When the HBO chief finished, Plank confronted him with a photo
of the Under Armour offices back in the U.S. It featured exactly that phrase
posted on the wall.
As it turns out, neither Plepler nor Plank can claim credit for
originating the "culture eats strategy" mantra, though there’s plenty
of debate about its heritage. Many attribute its birth to management guru Peter
Drucker, but it doesn’t seem to appear in any of his writing. Ford CEO Mark
Fields purportedly attributed the quote to Drucker back in 2006, just as it was
entering the business lexicon.
What matters more than the etymology of the phrase, though, is the
way Plank reacted to Plepler’s use of it. It was perfectly indicative of Under
Armour’s culture: competitive, feisty, fearlessly unwilling to cede an inch of
territory. This is precisely the ethos that has propelled Under Armour from a
startup operating out of Plank’s grandmother’s basement into a global
commercial force, with evangelists such as football quarterback Tom Brady,
swimmer Michael Phelps, golfer Jordan Spieth, and NBA wonder Steph Curry.
If you get to visit a variety of companies, as I am fortunate to
be able to do, you immediately get a feel for how different each business
culture is: Just as every family has its own vibe, so too do companies large
and small. IBM may be famously corporate (even if the white button-down uniform
has become more lore than rule), but that hasn’t prevented its talent from
creating and promoting Watson to become Corporate America’s signature AI
engine. Facebook’s headquarters features what may be the largest single-room
office space in the world, a meandering topography that includes cafes,
open-air meeting spaces, and glass-enclosed conference rooms. It can feel a bit
like a playground, yet the engineering under way there is definitely grown-up
stuff.
The larger point is that innovation
at each of these locations, for each different enterprise, must grow
organically from its own culture. Especially for modern businesses that have
moved away from strict command-and-control structures, the on-the-go decisions
made each day, at all levels of the organization—the activities that bring any
stated strategy to life—are the results of people’s habits and values. If GE wants to
"contemporize" its executive training facility, foosball tables may
not be the first option—but a more genteel all-day coffee bar might. Plepler’s
point about HBO at that dinner was that, for all the tumult over streaming
strategies and shifting cable-system business models, the company’s central
point of differentiation continues to be its content, which grows out of its
long-standing, well-demonstrated respect for artists. (HBO eventually
outsourced a key part of its streaming technology, in recognition of where its
strengths lie.)
As for Under Armour, it is telling
that CEO Plank won’t mention his chief rival, Nike, by name. The company’s
convention is to refer to Nike only as "the other guys"—a reflection
of Under Armour’s swagger. At Nike, they don’t
mention Under Armour by name much, either. But Nike’s culture is very
different: CEO Mark Parker began at the company as a shoe designer, and his
obsessions include an eclectic street-art collection. While Plank comes across
like a hard-driving football coach, Parker (who was a competitive marathon
runner in his younger days) offers a more Zen-like exterior. Still, both of the
companies’ cultures are demanding and results-driven. Their achievements come
from a common root: By leaning into their own culture—and not trying to be
"the other guys"—they find and execute strategies that allow them
both to succeed.
ROBERT SAFIAN
https://www.fastcompany.com/3068302/most-innovative-companies/what-under-armour-and-hbo-have-in-common
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