Growing a Non-Toxic Company Culture

by francine Hardaway on March 31, 2011

So you have put your MVP up, and a few users have latched on to it. Enough to know you won’t fail, and you actually have to build a team. Here is perhaps your greatest chance of failure.

Two founders working in a bedroom or a garage can usually get along while the business is in startup mode. But co-founders are locked in a sexy relationship that very quickly turns into a marriage when they have that first child — the MVP. Childless founders can move away from each other, no harm no foul, but as in real life the child presents complications.

How, indeed, should we raise this child? Very few people have this conversation in advance, and very few people discuss what kind of culture they’d like in the company they are building.. Instead, each assumes the other agrees about how the little prodigy should be raised. And that’s where the partnership often begins to go awry. Reading the advance publication section of Paul Allen’s autobiography, you can see (in hindsight) early on that these founders will have a problem. When your co-founder eats his chicken with a spoon, wears only one color pants, and codes all night without sleeping, if you have the misfortune to develop a serious illness you cannot expect the solicitude you might get from a person with a more social personality. Same-same for Jobs and Woz, who had a falling out as the company grew, and for Zuckerberg and Eduardo Savarin.

The more people who come into the company, including the investors, the less you can shape the company to your original vision without codifying that vision from the get-go. A good friend of mine is a technical recruiter for a recently funded company. They want to hire 100 engineers immediately. Without serious thought about how those people fit in with each other, with the founders, and with the other parts of the company, that will be a huge clusterfunk.

Ideally, every single hire should be a reflection of the founders’ vision. That means founders should be writing vision statements during the YCombinator phase of the company, or whatever comes before. Once you gather momentum, it’s almost too late. The bad examples of this are legendary. They lead to churn and dissatisfaction, and the inability to turn out a quality product.

The good examples are worth remembering. Starbucks happens to be one of them. When Howard Schultz discovered the barista culture in Milan and decided that Starbucks should be a similar experience, he found its differentiator. But he wasn’t a founder of Starbucks — he was its marketing guy, and he encountered major resistance. The three founders, all professors, were already heading in different directions, and Schultz made it worse for a while. There’s a great case study about all this.

In order to get his vision realized, Schultz had to create a separate company to try it out; two of the Starbucks founders were Schultz’s investors, and finally Schultz acquired Starbucks. Once he owned it, he could develop the “experience” he sought. And every employee fits into that experience. Starbucks hires for attitude (outgoing and customer-focused), and then trains its hires to know about coffee.

Another example of a strong corporate culture is Southwest Airlines, whose culture was defined by its hard-drinking, chain-smoking founder, Herb Kelleher, who made public appearances drinking a shot of Wild Turkey at the podium. Herb believed it was possible to run an airline and have fun at the same time, and as the company expanded, he kept its vision by also hiring for attitudes rather than skills. Even today, you can always tell the difference between a Southwest employee and an employee of any other airline: the Southwest employee will tell you the truth about why the plane is late, and actually try to help you.

Google is an example of a strongly defined corporate culture that hires on skills. From the get-go. It was designed to be a company where the smartest people in the world gathered to spend far more than the average work day. Even the young Google included food, games, couches, and other ways to keep the employees at the office. Google’s vision involves hiring the best engineers. After ten years, I’m told the hiring criteria are changing: you can’t build a culture on just brilliance.

To bottom line it for you: hiring others is the most important thing you will do, and too many founders can’t do it. Then one morning they wake up to their troubled, disfunctional organization and wonder how it got that way.

{ 1 comment… read it below or add one }

Phillip Blackerby April 5, 2011 at 10:33 pm

Company culture is one of just three things a CEO cannot really delegate (the other two are strategic planning and ensuring the company has cash to operate). If a CEO doesn’t mold the culture, if the CEO doesn’t define it and hire to it, as Francine says, the culture will almost certainly become sick of its own accord. If the culture is sick, it’s the CEO’s doing, and the CEO should be undone. Fish rots from the head down.

Leave a Comment

Previous post:

Next post: