Culture is serious business. Peter Drucker, in fact, has famously said, “Culture eats strategy for breakfast.”
I personally think that this quote is a bit on the conservative side. In reality, culture can eat strategy for breakfast, lunch and dinner.
In this post, I will focus on the challenges of scaling culture in a growing startup and the different types of startup cultures that you will come across.
Before we delve deeper into culture and its various nuances, let’s get to the same page on some definitions. I can’t help but notice that a lot of startups equate culture with perks. We have a ping-pong table, they say. (As an aside, did you know about the correlation between the sales of ping-pong tables and startup funding? Here you go). Some of them talk about free lunch or a work-vacation. Others create ornate descriptions of their culture and values on their walls. While these are great artefacts of culture, we need to look deeper for the real deal.
Jeff Lawson of Twilio nails it when he says,
Culture is the collection of people making decisions every day. Thousands of decisions are made every day. Culture is how you, as say a leader of the company, are conﬁdent that every one of those decisions is the right one.
For this to happen, the artefacts, values and the underlying assumptions have to be well understood across the board and acted upon on a daily basis.
I double-hat as the CEO and Chief People Officer at my firm and I can tell you that we obsess a great deal about our culture and core values. We seek to create a 'wow' experience for our learners. Every interviewer at our firm carefully evaluates the core values we have set when hiring. Every month, we have awards aligned to our core values. We are starting to roll out performance conversations around our core values as well.
Scaling culture past the Dunbar number
As we pace furiously towards the 150-headcount mark, I am mindful, more than ever before, of the need to cascade our values and strengthen our culture. Hundred-and-fifty, after all, happens to be a magic number in social sciences. It is called the 'Dunbar Number', named after British anthropologist Robin Dunbar, who specialised in primate behaviour. His seminal work revolved around the measurement of the cognitive limit to the number of individuals with whom any one person can maintain stable relationships. This limit happens to be 150.
Hudred-and-fifty is the number beyond which senior leaders’ bandwidth becomes severely restricted to make deep personal connects. The passion that created and sustained the organisation, therefore, will not be felt by the new joiners firsthand.
I do believe that a lot of organisations become run-of- the-mill, from a culture standpoint, if they don’t handle the transition well around the 150 mark. Startups will need legions of leaders and managers at various levels to carry the torch forward. The leadership team will also need to communicate through non-personal means very often to reiterate the core message and make time, whenever possible, to make personal connects with team members from various parts of the organisation. Most importantly, leaders must enable every single person in the organisation to know what the right decisions are and act accordingly. As they say, culture is what remains when the leader steps out of the room.
Types of startup cultures
As I was reading through the warm welcome email that we send to new hires, I noticed the tremendous consistency in the message sent by our team members. “Welcome to the family,” most of us say.
We are extremely proud of the culture we have built - one that is predicated on respect and care. Our intent has always been to create a safe environment for our employees, where they can aspire to be the best versions of themselves. So “family” does seem to fit the description well. We are the 'Incredibles', who perform astonishing feats, building on each other’s strengths.
The welcome email chain got me thinking, though, on how other startups characterise their cultures. My search took me back to the famous Netflix culture deck. The deck categorically says:
We are team, not a family. We are a pro-sports team, not a kids’ recreational team.
Later, I happened to listen to a riveting talk delivered by Capt. Raghu Raman. In a talk that I’d rate as one of the best I’ve heard in recent times, he talks about the similarities between the startup world and the army. He presents a framework that works in the army that works equally well in startups.
So, which startup culture is right for you? Of course, it depends. If there is a contribution from the field of management to humanity, it is this answer - it depends. What does it depend on? It depends on your goal and how you are trying to achieve it. Let’s now look at the three cultures closely.
Startup as a family
In this culture, the working environment is warm and friendly. Team members strive to create bonds with others and share a lot in common, and in many ways, it’s similar to a large family. Startup leaders in this setup often play the role of
mentor or coach. There is a great deal of involvement and employee engagement. The organisation cares deeply about employees and organisational success is often defined in terms of addressing the needs of the clients and caring for the people along with numbers.
What to watch out for? Potential trade-offs between loyalty and performance, slow decision making.
Startup as a sports team
This is a results-oriented organisation that focuses on getting things done. People are competitive and driven by goals. Leaders drive superior results by setting high expectations and by acting as hard drivers, producers, and agent provocateurs at the same time. Winning is what binds the organisation together. Success is defined through competitive edge and market share, along with results.
What to watch out for? Potential lack of collaboration between individual superstars, poor people development practices.
Startup as an army unit
This organisation has a structured work environment. Process orientation and procedures drive the organisational culture. Leaders set the tone through their efficiency-driven decision making. The organisation is deeply committed to the mission and marches in synchronised steps towards the goal. Success in such an organisation is looked at through the lens of stability, long-term orientation along with results.
What to watch out for? Poor empowerment, lack of creativity
I’d love to hear from you on which of these three best describes your startup. How are you managing the strengths and weaknesses of your startup culture? What are you doing / have done to scale your culture past the Dunbar Number?
Whichever startup culture you pick, remember,
“Customers will never love a company until its employees love it ﬁrst”