- PwC: Culture a source of competitive advantage but gulf in attitudes between senior management and rest of workforce never greater
- 69% of business leaders whose organisations have successfully adapted in the pandemic say culture has been a source of competitive advantage
- Average 20-point gap in attitudes towards diversity, equity and inclusion highlights divide between senior management and the rest of the workforce
Culture is advancing on the leadership agenda, but the gulf in perception between senior management and the rest of the organisation has never been greater, according to a new PwC study.
PwC’s 2021 Global Culture Survey, canvassing the views of 3,200 workers worldwide, finds that culture is a source of competitive advantage and a strategic priority for senior leaders, but it has been deprioritised in the eyes of the rest of the workforce.
Culture as a source of competitive advantage
69% of respondents who say their organisation has been able to adapt over the past year also say their culture is a source of competitive advantage. The data also shows that respondents who say their organisation has a distinctive culture are more likely to also see an increase in revenue and customer and employee satisfaction. Three-quarters of senior management (72%) agree that their culture helps successful change initiatives to happen.
Globally, 73% of respondents who state that culture is a source of competitive advantage say making decisions quickly has either become easier or stayed the same during the pandemic. The proportion of people agreeing with this rose in the US (81%), UK (77%) and China (81%) respectively. Conversely, only 57% of respondents globally who state that culture is not a source of competitive advantage found decision making easier or the same during the pandemic. In China, this percentage dropped to 38% whilst in India it rose to 68%.
The global survey results demonstrate a clear divide between those who say their culture is distinctive and those who do not, namely that the following have become easier or stayed the same:
- Coaching and developing talent (55% vs. 41%)
- Developing or maintaining a sense of community (60% vs. 43%)
- Responding to customer needs (66% vs. 57%)
- Innovating new products and services (66% vs. 56%)
- Producing/delivering expected results (63% vs. 51%)
Bhushan Sethi, Joint Global Leader for People and Organisation at PwC, commented: “Organisations with a view of culture as a distinction and source of competitive advantage maintain a sense of community better, respond to customer needs better, innovate with a higher degree of success and deliver better business results. As many organisations adjust to hybrid working models for the first time, the key question is what approach will senior leaders take to maintaining a coherent organisational culture.”
The divergence in attitudes between senior management and the rest of the organisation
The data shows that culture has been deprioritised in the eyes of the rest of the workforce. In 2018, 66% of front-line workers believed that culture was more important than strategy or operating model, vs. 46% in 2021. Similarly, there is a divergence in the way that purpose is viewed by different staff levels, with 77% of senior management stating they feel a personal connection to the company’s purpose in contrast to just 54% for the rest of the workforce.
Attitudes towards diversity, equity and inclusion (DEI) demonstrate the divide most acutely, with the data showing an average 20-point gap between the views of management and everyone else on DEI topics. This gap grows to an average 30-point gap in the US and 35% in Japan. Conversely, there is only an average 10-point gap in India.
Three-quarters of senior management (71%) feel that they can be themselves at work, against just 52% of middle management and front-line workers. In the US, 96% of senior management state they can be themselves at work, vs. only 60% of senior management in Japan. 62% of the rest of the US workforce feel comfortable vs. only 19% of ordinary workers in Japan.
Similarly, 61% of senior management globally believes that their organisation encourages discussion on sensitive and uncomfortable topics, in contrast to 42% of middle management and front-line workers. Here the divide is clearest to see in China, where 70% of senior leaders state they encourage discussion vs. just 31% for the rest of the workforce.
Finally, 69% of senior management believe that their organisation embraces flexibility and accommodates people with differing needs, vs. 51% of middle management and front-line workers. In India, however, the spread between senior leaders is lowest with 78% of the workforce believing their company accommodates people with differing needs against 90% of senior management.
Bhushan Sethi concluded: “The divergence in attitudes towards diversity, equity and inclusion is the standout finding from this year’s study. In the context of rapidly changing societal and cultural expectations placed on firms, it is an imperative for leaders to tackle misgivings around DEI head on. This may include engaging internal and external stakeholders to define, commit and track progress against inclusive behaviors and ways of working which build societal trust and enable sustainable business outcomes .”
