Company Culture

by Scott Austin March 02, 2014

Company Culture

Lot's of companies talk about their great culture.  I'd guess that most companies aspire to have great culture.  But not every company that aspires to have a great culture does.  Here's my opinion on what makes a company's culture and what to focus on.

What is Culture

I like to boil things down to make them simple (so that I can understand them).  For me, a company's culture is as simple as the way it treats its people and how decisions are made.  And these two items are interrelated.  Let me illustrate this with some examples from my career.

The Good

In 1999, I started at Microsoft.  One of the first things that impressed me there happened on my first day.  You went to security (which back then was located in the basement of Bldg 8 and quite a maze to get to).  They took your picture and gave you a badge.  The amazing thing to me was that this badge, that was given to every new employee, got me into every building in Redmond.  And back then, 99% of the offices were unlocked.  Coming from my Manhattan background, I was impressed that the company gave me such free access to all of its facilities.

A few months later, I hired Mark.  He had been a high school teacher for the previous 15 years.  And his school, like many others, had budgetary constraints and was tight with supplies.  His first week on the job, he came into my office all excited.  He had just seen the supply room.  On every floor of every building at Microsoft, they had a supply room.  It was typically a large, open room and ussually had no doors.  And it was fully stocked with anything you might possible need.  And you could just take anything.

For me, one aspect of Microsoft's culture was trusting its employees.  The examples above support that.  And the company didn't talk much about it; it just did it.

The Bad

In 2010, I started working at the Active Network in San Diego.  The company touted its culture as being great.  One of the proof points they constantly pointed to was its wellness program, which was great.  There was yoga in the morning, PX90 at lunch, triathon training on the weekends, etc.  But the overall culture at Active was horrible.  Remember, I say that culture is about how the company treats its people and how decisions are made.  At Active, decision making was centralized with the President of the company.   He micro-managed all of the numerous product lines.  He didn't explain his reasoning and just expected everyone to do as he told them.  So the culture around decision making was very poor.  And in general, the company had a pretty unhappy employee population as evidenced by its massive turnover.  You can see what I mean at Glassdoor.

Culture Endures

My friend, David Edery, gave a talkone time about company culture.  He quoted a MIT study that had shown that, once set, it was nearly impossible for a company to change its culture.  I do believe this to be true.  One of the reasons is because culture is not about what the company says on its 'About Us' page.  Sure you can easily change that page.  But culture is ingrained in the way people interact with each other and how the decisions are made.  Much of that is sub-conscious.  Back to my Active example.  I said that decision making was centralized at the top.  Well, all of the execs that created that culture are gone.  But check out Active's 'Our Leaders' page in its About Us section.

Active's Our Leaders Page

That's it, the Leadership 'TEAM' at Active, according to their own website, only consists of the CEO.  (I'm not making this up!)  So, I'm guessing the culture there is still one where decision making is controlled by the top of the org.  Here's a couple of reasons why a culture, whether good or bad, endures:

  • A culture will attract and retain like minded people.  So if the company is autocratic, it will retain people who thrive (or at least endure) an autocratic org.
  • A culture is larger than the exec team.  It becomes infused throughout the company.  So, even if the CEO changes, the rest of the company is still doing things the way they have always been done.

How to Create Your Company's Culture

If you are a founder at your startup, you've got a lot on your plate right now.  You're trying to develop a product, build a team and, not least of all, build runway.  So you won't be spending a lot of time manufacturing a culture.  Much of it will just come from who you and your co-founders are.  You'll impart your values onto the company's culture.  If you believe in people, the culture you build will reflect it.  If you are data driven, your decisions will also be data driven.  I'm not saying that can't create and foster a certain amount of your culture--you certainly can.  But I am saying that the culture of your company will be a reflection of you (in the good and bad).

Now, here's my advice on how to foster that core culture that you create.  Remember back to my definition of company culture.  Its the way the company treats its people and how decisions are made.  In the early days of your company, focus on those two things.  Treat the team with respect.  And be conscious of how decisions are made.  Your company is probably too young (and too strapped for cash) to worry about the perks that many associate with culture.  Your office space won't be sexy and you won't be providing every beverage known to man in abundance.  But if you treat people well and make smart decisions, you'll attract and retain the right people.  The kind of people that will help you build the company so that you do have the money to focus on the 'fun' side of culture.

Let me dig into the people part a little more.  Some people may think that how people are treated comes down to salary.  But its far bigger than that.  It has much more to do with the company's day-to-day with interactions with its employees that it does with salaries, benefits, titles, etc.  Are people kept informed?  Do they have clear and consistent priorities?  Are they listened to?  These are the actions that determine a company's culture.

Scott Austin
Scott Austin