In June, several of my colleagues and I headed out to Silicon Valley for the annual True University conference. This is an amazing event put on each year by our major investor, @TrueVentures. It features two days of classes and workshops for representatives of their 90+ portfolio companies. It was a fantastic experience. I got to meet a ton of impressive people, from the presenters from Stanford and Berkley as well as industry leaders in a number of areas. While there were many great presentations and interesting discussions over cocktails, one theme kept coming up throughout the two days – the importance of company culture. While much discussion centered on how to successfully scale a startup’s culture during times of rapid growth, the message that really resonated with me was the need to establish and cultivate a deliberate company culture that aligns and drives your company strategy.
In almost all of the sessions about culture, one thing was mentioned over and over again – your company has a culture, whether you’ve intended it or not. Maybe it flows freely from the company’s founder or chairman, but perhaps, like many large enterprises, it’s become a culture of politicking and finger pointing. Whether you are happy with your culture or think it needs improvement, you should always be shaping it. Identify your ideal company culture and work hard to ensure it is reality.
Session #1: Lisa Solomon on designing company culture
The session at True U that really shed light on creating a deliberate company culture was called “Leader as Designer: Building Adaptive Organizations.” It was led by Lisa Solomon, author of the Wallstreet Journal bestseller, Moments of Impact: How to Design Strategic Conversations that Accelerate Change. She advocates thinking of company culture as something that needs to be designed, ensuring you are making decisions that elicit the desired responses. This means that in order to define your desired culture, you need to understand what responses you are hoping to elicit from your employees. This doesn’t mean generic things like “work efficiently” or “communicate clearly”. It should be specific attributes based on the strategy and value propositions of an organization.
Lessons from the leader in customer service, Zappos
Tony Hsieh knew that the value proposition of Zappos was going to be phenomenal customer service, like nothing anyone had every seen from an online retailer. Knowing how critical this was going to be to the success of his company, he invested heavily in a company culture that would ensure engagement and alignment on this corporate strategy. Every new hire at Zappos went to a 4-week training course on the Zappos company culture. At the end of those 4 weeks, each person was offered $2,000 dollars to quit the company. Hsieh felt that if you weren’t fully bought in and invested in what you learned over that first month, he would rather pay you to leave than risk infecting the culture he valued so dearly.
Back to the basics: establishing a strong company culture
The first thing to do when embarking on an evaluation and potential redesign of your company culture is to revisit the fundamentals – who you are as a company, who are your customers, and what is your value proposition. Once you know those things, you can clearly define the strategy that best serves those customers and leverages and enhances that value proposition. From there, you need to define the key qualities of your company culture that will drive that strategy. Not all companies will be the same, and if you try to be all things at once, you will not get that deep investment that makes a strong culture so valuable. I recently met with an asset manager whose core values were focus, humility, and kindness. Each and every member of the company knew these values and they were reflected in every decision the company made, from how they treated investors to how the company bonus structure was paid.
Session #2: Jennifer Chatman’s “culture audit”
After leaving the session led by Ms. Solomon, I understood the value of a strong company culture that aligns with and drives the corporate strategy. The next question was, “Now that I know what my culture should be, how do I get there?” Fortunately, Tuesday morning’s general session by UC Berkeley’s Jennifer Chatman showed me the way. She led close to 300 participants through what she calls a “culture audit”. It’s used to help identify the gaps between our current culture and our ideal, strategic culture, and it also provided an action-planning template to create a strategically effective culture. The three areas of focus were:
1. Recruiting and Hiring – How do you identify candidates with the cultural attributes you desire, and how might you need to look at candidates differently than you do today?
2. Socialization and Development – Ensure communication and coaching aligns with the desired corporate culture.
3. Rewards and Leadership – As a leader, you must live these values each and every day. If employees see you acting counter to these new values, they will not take hold. Formal and informal rewards should be given based on the engagement with the desired culture.
Stay true to your company culture
Having said all of this, changing a company’s culture is no easy task. You can’t simply implement a few new processes and check a few boxes. It really has to become the essence of everything you do, and it must flow from the top. If senior leaders are not bought in, the rest of the company will sense it and the effort will fall apart.
Finally, I leave you with two of my favorite quotes I heard out at True University 2015.
“Train people well enough that they can leave, treat them well enough that they don’t want to.” – Richard Branson
“If you want to build a ship, don’t drum up people to collect wood and don’t assign them tasks and work, but rather teach them to long for the endless immensity of the sea.”
– French writer and Aviator Antoine de Saint Exupéry