ASIAN CASE RESEARCH JOURNAL, VOL.

24, ISSUE 1, 1–12 (2020)

ACRJ
PERSPECTIVES

This technical note was pre-
pared by Ming-Jer Chen,
Leslie E. Grayson Professor
of Business Administration,
and Y. P. Chan, Principal
of Chanden, Inc., with assis-
tance from Charles Tucker,
Senior Researcher. The
authors acknowledge funding
support from the Darden
Center for Global Initiatives.
Please send all correspon-
dence to Prof. Ming-Jer
Chen, Darden School of
Business, University of
Virginia, Post Office Box
6550, Charlottesville, VA
22906-6550, USA. E-mail:
ChenM@darden.virginia.edu
The Culture–Strategy–Execution
Trio: A How-To Guide
For the past century, business strategy and execution tactics
taught by Western business schools have, for the most part,
worked well for Western companies. As the world has
become increasingly interconnected, however, and businesses
encounter new cultures, histories, philosophies, and local prac-
tices, a two-dimensional focus on strategy and its execution is
not sufficient to serve the competitive needs of many firms.
The culture–strategy–execution framework, or the Trio
Model (see Figure 1), offers organizations a powerful, adap-
tive approach to navigating today’s complicated global issues.
By considering culture as an integral part of strategic thinking,
executives and practitioners adopting the model take a holistic
approach to solving practical problems. Since developing the

Source: Created by the authors.

Figure. 1. The Trio Model: Linking culture, strategy, and execution for
global business success.

© 2020 by World Scientific Publishing Co. DOI: 10.1142/S021892752010001X

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framework, Ming-Jer Chen has taught the Trio Model exten-

sively to MBA students and business executives in the United
States and China.
To extend the use of the framework, this how-to guide
lays out a system of tools and processes for each of the
model’s three components: culture, strategy, and execution. It
explains the strategic rationales and implications of the model
as well as the tools and specific steps that can be used sys-
tematically to collect and analyze data, articulate insights,
and develop a practical, results-oriented culture–strategy–
implementation plan. The guide includes a business case that
demonstrates how the model can enable managers to differ-
entiate their company’s competitive advantages for sustained
success.
The three elements of the Trio Model (Figure 1) func-
tion as an interdependent process: culture entails under-
standing and adapting to country, organizational, local, and
individual beliefs and practices; strategy focuses on the “power
of one,” or believing in and doing one thing exceptionally
well; and execution requires persistence in carrying out the
company strategy to an end that achieves the desired results.1
Culture is a combination of customs, values, beliefs,
philosophies, heritage, practices, language, and social norms.
Corporate culture is critical. In the words of Lou Gerstner,
the former CEO and chairman of IBM recognized for turning
around the firm’s fortunes in the 1990s, “I came to see that
culture isn’t just one aspect of the game — it is the game.”2
“Strategy,” said former General Electric CEO Jack
Welch, “is the evolution of a central idea through continu-
ally changing circumstances — long on detail and short
3
on vision.” As Gerstner put it, “Good strategies start with
massive amounts of quantitative analysis that is blended with
wisdom, insight, and risk taking. Truly great companies lay
2
out strategies that are believable and executable.”
Execution is “a systematic process of rigorously dis-
cussing hows and whats, questioning, tenaciously following
through, and ensuring accountability,” said Larry Bossidy,
4
former Honeywell International CEO/chairman.

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 THE CULTURE–STRATEGY–EXECUTION TRIO: A HOW-TO GUIDE  3

The next section describes a six-step process for

adopting, integrating, and implementing the three elements.

APPLYING THE INTEGRATIVE TRIO MINDSET:

TOOLS FOR ANALYSIS, ARTICULATION, AND
IMPLEMENTATION

Culture

The first step in evaluating an organization’s culture is for

the company founder, CEO, and top management team to
assess their cultural backgrounds and fundamental personal
values (Figure 2). It is important to dig deeply into the sub-
conscious mind and examine feelings to identify values that
have influenced the firm’s leader(s). This step is often missed
in the Western approach to building corporate culture, espe-
cially when the leadership team is not geographically diverse.
Aligning personal values with culture will create sustain-
ability for the long term.
Second, it is critical to determine what makes sense for
the company. The identification process normally involves
key senior employees, as they play a critical role in firm-wide

Source: Created by the authors.

Figure 2. Building corporate culture.

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 4 ACRJ

buy-in of the culture. A strategy brainstorming session by a

Chinese biotech firm’s senior leadership team illustrates the
importance of identifying, and endorsing, the right culture.
In the meeting, a top manager noted that the culture of the
firm’s chief competitor was driven by the goal of serving
customers at a high level even if it required questionable
business practices. The firm’s senior team debated whether
it should change the company’s culture and practices to
follow its rival. After closely examining its own culture, the
team affirmed that the personality and values of the CEO and
the mindset of senior leadership were centered around tech-
nology innovation rather than issues concerning prevalent
business practices in China. The team affirmed its culture,
avoiding a potential misalignment of organizational values
and customer-driven practices.
The third step in developing the right culture is to
identify and choose a person to be responsible for driving it.
Normally, this is the founder or CEO because the develop-
ment of culture must begin and be modeled at the very top.
Fourth, the elements of culture should be used to
recruit and build a team of people whose values, beliefs,
and philosophies align with the firm’s. Therefore, for young
companies, the first 10 employees are the most critical
because they will influence the next group. For example, in
a high-tech start-up in Seattle, the first step in interviewing
employees was to screen for culture fit even before technical
skills and domain knowledge. (While our examples focus on
entrepreneurial or smaller enterprises, the principles can be
applied to companies of all sizes.)
Fifth, the firm’s leaders must effectively and consistently
communicate the culture to existing and new employees to
ensure everyone is on the same page. Often, the most effective
communication is leading by example on the part of top man-
agers through daily interactions and decision-making that is
consistent with corporate values.
In the sixth step, as the company grows, it is essen-
tial for the founders/CEO to reflect on how the culture has
shaped the firm. This critical element might need to be
adjusted to reflect a new or changed reality, but the essence

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 THE CULTURE–STRATEGY–EXECUTION TRIO: A HOW-TO GUIDE  5

of corporate culture should be consistent over time. Once

the culture is established, the company should not revise it
without good reason. Based on our observations, establishing
a strong company culture may take many years, and a clear,
firmly rooted culture offers unique competitive advantages
in building a strong team from top to bottom and achieving
results.
In order to develop a unified and balanced cultural
foundation, it is critical for leaders to recognize and respect
differences between possible conflicting cultures outside the
firm and to recognize tensions that could result. It may be
necessary to consider:

(a) Country/geographical culture (e.g., Western versus Chinese);

(b) Regional culture (e.g., liberal Silicon Valley/California
versus the more conservative Mesa/Arizona);
(c) Corporate/organizational culture (e.g., entrepreneurial
Amazon versus the established Exxon Mobil);
(d) Personal/ideological culture (e.g., Christian versus Confu-
cian).

Finally, it is important to understand that there is often

a significant difference between surface culture (formal) and
hidden culture (informal). Both should be carefully observed,
and gaps or misalignments between them should be taken
into consideration. Often, sensitivity is the key to imple-
menting culture. For example, the culture of saving face that
characterizes companies in China might clash with the formal,
open and direct corporate culture that is typical of Western
firms.

Strategy

Adopting ideas from Hambrick and Frederickson’s Diamond

Framework,5 the first step in analyzing and developing a
strategy is to decide on an arena — where the company
wants to be in business — and then set clear goals and an
overall direction based on the company culture established at

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Source: Created by the authors.

Figure 3. Developing a strategy.

the beginning. The objective is to determine a durable direc-

tion, so the firm knows where it is going in the long run
(Figure 3).
The second strategy step is to understand the needs of
both the market and the company’s customers, in order to
identify gaps and opportunities for creating value. Unlike the
traditional strategic development process where culture plays
a small role or is not a factor, in the Trio Model, it is critical
for the firm to look at a range of culture elements within its
market and customer base. For example, a retailer such as
Amazon must develop a fast-paced, entrepreneurial, results-
driven culture, requiring a strategy catering to short-term and
ever-changing needs of the consumers.
Third, with a strong understanding of market and
customer needs, the firm can develop products or services
with clear value propositions catering to certain cultures or
countries that can differentiate the firm from competitors.
In the fourth step, with goals, needs, and products and
services articulated, the firm can develop a business model

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 THE CULTURE–STRATEGY–EXECUTION TRIO: A HOW-TO GUIDE  7

with a strategic roadmap assimilating a combination of

detailed analysis, experience, insight, and risks. An effective
business model defines the economic logic of how to evaluate
various performance benchmarks and provides a detailed
implementation plan that controls for risks.
The fifth step is to communicate the strategic busi-
ness model and roadmap with all stakeholders so they can
contribute to the success of the undertaking. Business rarely
follows a straight line and is often unpredictable. Therefore,
in the sixth strategy step, based on Chen and Leong’s work in
competitive dynamics,6 it is critical for the company to antici-
pate and prepare for uncertainties in its internal and external
environments as well as for competitors’ responses to its stra-
tegic moves. The ability to change according to shifting envi-
ronments allows a company to adapt and thrive over time.

Execution

For the six-step process for analyzing and developing a

strategy execution plan, we adapted some of Bossidy and
Charan’s central concepts.4
First, the company must focus on making key assump-
tions about its overall business environment, and develop
business and financial models based on its strategic roadmap
(Figure 4).
The second step is to assess the company’s capabilities
to determine if it has the skills needed to achieve its goals. If
not, what competency gaps must the company bridge? When
advising the CEO of the Seattle start-up mentioned earlier,
one of the key tasks for the co-author was to constantly chal-
lenge the leader to think about both the needs of his team
and the skill gaps as the young company aimed to under-
take world-class innovative projects. A major part of this
effort was to identify new team members who could meet the
needs, or, when the required skills were not readily available,
provide specific training to close the skill gaps.
The third step for implementation requires aligning
strategy, execution, and people — linking the strategy to the

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 8  ACRJ

Source: Created by the authors.

Figure 4. Planning and execution.

operations and personnel who will be implementing it. The

firm must assign the right people to the right tasks. Matching
employees with the appropriate skills for a job is one of the
most critical responsibilities of a company leader.
Fifth, once people and tasks have been aligned, a
reward system based on the desired outcomes must be
designed. The system must be clear, easy to understand, and
quantifiable, so employees know what to expect at the end of
achieving their tasks with measurement and accountability.
Finally, a process for execution must build in a mecha-
nism for revised assumptions in response to a new environ-
ment. A solid proactive design and change mechanism will
help the company to adapt and minimize potential risks.

APPLICATION OF THE TRIO MODEL

The six-step tools for each of the three components in the

Trio Model allow company leaders to think through culture,
strategy, and execution issues holistically and integratively,

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 THE CULTURE–STRATEGY–EXECUTION TRIO: A HOW-TO GUIDE  9

and to develop specific action plans to carry out strategic

tasks. Culture is about corporate values, strategy is about
analytical mindset and methodology, and execution is about
practice.
Now we take a look at the case of a digital technology
company to see how a firm can adopt and apply the culture–
strategy–execution Trio Model to build and expand its business.

THE CASE: PERFECT WORLD

Since 2008, Chinese entrepreneur Michael Chi had grown

Perfect World Co., Ltd. (Perfect World) into a very successful
digital gaming business in China. Having dominated the
local market, Chi was ready to expand. The challenge was
to implement a global growth plan that would achieve the
firm’s vision of providing “personal happiness” for customers
beyond China.

Application

Culture: Chi believed that a strong corporate culture and

values were the bedrock for international expansion. He first
conducted a self-assessment of his own culture and values.
As a perfectionist who believed in pursuing one’s dreams,
Chi was idealistic and scholarly by nature. Rather than social-
izing, he preferred solitude and having time to think about
issues in depth and breadth. Consequently, the company’s
culture was partially based on his belief in perfectionism in
pursuing his ideas.
In order for the firm to expand in North America,
Europe, and Asia through subsidiaries, it was critical for
Chi to develop company-wide values with universal appeal
around the world. He identified the elements of the corporate
culture in two key dimensions — kindness (or integrity) and
dynamic balance, which reflects a central Confucian philos-
ophy. The two elements had a common appeal in both China
and the West: integrity was the foundation, and dynamic

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balance the key to satisfying different stakeholders in a given

ecosystem and within society at large. Instead of outsourcing
company culture to other leaders, Chi realized he must
drive the culture and build a team that would reinforce its
elements.
Strategy: After articulating and developing Perfect World’s
culture, Chi turned his attention to the company’s strategy
and business model. The model was built around three core
drivers: (1) digital content driven by intellectual property,
(2) global mass-market consumers, and (3) a digital distri-
bution channel. To achieve the firm’s goals, he expanded
beyond gaming into movies, education, novels, cartoons,
and media such as Star Trek Online to build Perfect World’s
content and brand awareness. He had been very effective in
translating his strategy into execution by leveraging two core
competencies: software and artistic capabilities.
Execution: To implement his vision, Chi hired a profes-
sional manager as CEO to run the company so that he could
focus on what he liked the best: developing and maintaining
corporate culture, articulating strategic direction, developing
unique management systems, and creating “perfect” products.
To embed the culture and strategy in execution, the company
developed 38 management practices, which it categorized as
‘basic’ or ‘unique’. Basic practices are used by most compa-
nies around the world. Perfect World’s unique practices were
developed based on the founder’s personal beliefs, company
background, and organizational growth, to create distinct
competitive advantages for the firm.
An example of a unique “one” (referenced earlier as
the “power of one”) is the company’s Reserve CXO Talent
Pool policy, which is used when not all the key people on
a given project are deployed fulltime. Unlike other compa-
nies, which may let nondeployed employees go, Chi puts
them into a pool of current-project advisors for top execu-
tives. In this way, employees continue to add value during
their downtime, and they do not have to worry about losing
their position with the company. By reserving talent, the firm
can get the right people into new projects quickly and on a
global scale. It also creates loyalty among knowledge-based

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 THE CULTURE–STRATEGY–EXECUTION TRIO: A HOW-TO GUIDE  11

employees, who are difficult to recruit, train, and retain

globally. As of July 2018, Perfect World had a market capi-
talization of about $5.5 billion and distribution in over 100
countries and regions.

CONCLUSION

The Perfect World case demonstrates how the integrated

culture–strategy–execution approach can facilitate global
expansion where significant cultural and business differences
between the home market and new markets exist. The fol-
lowing lessons from the case are universally applicable for
use in other organizations and contexts:

• A good foundation is built on corporate culture and strong

values that leverage the wisdom of the firm’s ethos and
history, yet have appeal beyond the home market.
• An integrated culture–strategy–execution approach must
take into consideration macro-market trends, company
competency, unique business models, and management
practices and systems that provide competitive advantages
to create value for all stakeholders.
• Hiring and keeping the right talent is essential so that
employees can focus on what they do best. This in turn
allows the firm to assemble the most effective team to
take on new opportunities and adapt to new or changing
environments.

Integrating culture with strategy and execution is

a smart, effective approach for businesses and executives
seeking differentiators for success in their competitive arena.
In today’s interlinked global marketplace, the Trio Model is
an invaluable tool in a company’s competitive repertoire.

REFERENCES

1. Ming-Jer Chen, “Case in Point: Using the Power of ‘One’ as a

Business Practice,” The Washington Post, July 8, 2012,

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https://www.washingtonpost.com/case-in-point-using-the-
power-of-one-as-a-business-practice/2012/07/06/gJQAnWalUW_
story.html.
2. Louis V. Gerstner, Jr., Who Says Elephants Can’t Dance? (New York:
Harper Business Ltd., 2002).
3. Jack Welch, Jack: Straight from the Gut (New York: Grand Central
Publishing, 2003).
4. Larry Bossidy and Ram Charan, Execution: The Discipline of Getting
Things Done (New York: Crown Business, 2002).
5. Donald C. Hambrick and James W. Fredrickson, “Are You Sure
You Have a Strategy?,” Academy of Management Executive, Vol. 15,
No. 4 (November 2001), pp. 48–59.
6. Ming-Jer Chen and Jin Leong, “Competitive Dynamics:
Competition as Action-Response,” Darden Case No. UVA-S-0123
(Charlottesville, VA: Darden Business Publishing, 2005).

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