[YS Learn] Why the ‘always hustle’ culture can hurt your startup’s productivity
What is startup culture? How can we measure its success? How much is productivity impacted by this culture? After all, analysts suggest your productivity is determined by the culture you have.
Friday January 22, 2021,
7 min Read
There are many ways to describe a startup’s culture. A Harvard Business Report puts it — culture is easy to sense but hard to measure. Each startup’s culture is defined by what stage they are in, what the founder and higher management believes in and their personalities.
In 2017, Uber had faced one of its toughest churns. The ride-hailing giant caught the public eye for its extreme hustle culture, and the toxicity it ended up breeding. This came out of the Co-founder and the then CEO Travis Kalanick’s personality.
In his blog, Travis wrote, “Necessity taught me the very fine art of bootstrapping. Blood, Sweat and Ramen is what I like to call it. I was always thinking about how to make things ultra-cheap, hyper-efficient while making a good story out of it.”
Travis built a successful startup that not only changed the face of personal transportation but also became a force to reckon with while earning a sky-high valuation. He was exactly the type of leader that the San-Francisco based ride-sharing app needed.
Uber was ruthless in the way it got ahead. But when it got too big, that became a problem. Not only did it invoke public ire, the startup had begun taking hard hits.
In an earlier conversation with YourStory, Krishna Kittu Kolluri, Founder and Managing Director, NeoTribe Venture, San Francisco, stated that the primary tenets of leadership are culture and communication. Culture is a set of shared values.
“As a leader, you not only have to practice what you preach but also preach what you practice,” he said, “While culture doesn’t guarantee success, a company without culture cannot build a sustainable business.”
Pressure works? Not quite
As the HBR analysis says - “Too many companies bet on having a cut-throat, high-pressure, take-no-prisoners culture to drive their financial success. But a large and growing body of research on positive organisational psychology demonstrates that not only is a cut-throat environment harmful to productivity over time, but that a positive environment will lead to dramatic benefits for employers, employees, and the bottom line.”
In the fast-paced business and startup world, there has for far too long been an assumption that stress and pressure can push employees to do better, but there are hidden costs. “The mental health and well-being is compromised and can lead to an individual performer’s burn and even many accidents or errors while working,” says a leading psychological counsellor for employees of leading startups, on the condition of anonymity.
Quoting a report by American Psychological Association, HBR writes that more than $500 billion is taken off the economy because of workplace stress. It explains close to 550 million workdays are lost due to job stress, and over 80 percent of workplace accidents have been attributed to stress.
The report said, “In a large-scale study of over 3,000 employees conducted by Anna Nyberg at the Karolinska Institute, results showed a strong link between leadership behaviour and heart disease in employees. Stress-producing bosses are literally bad for the heart.”
Several employees of leading startups add that workforce stress has even led them to completely disengage from work. “Continuously having to prove yourself to your seniors and bosses can be really exhausting. After a point, you just run through the motions because you simply have to,” says an employee of a leading Indian startup, on the condition of anonymity.
Studies have shown that to be continuously engaged at work, employees across hierarchies need to feel secure, safe, valued, supported, and respected.
On the condition of anonymity, an employee who worked for a global Series E funded startup says,
“Most of the higher global authorities hardly understand the Indian market in terms of supply and demand. What’s worse is that the Indian regional counterparts understood it really well and started to take advantage of the global heads. The problem was that there were too many Indian counterparts trying to assume ownership of the team and it led to a whole set of inertia problems. Like a lack of structure and everyone trying to prove they were better this in turn led to misplaced priorities and trickled down approvals.”
You lead I follow
The counsellor added many of these startups have in-fighting within managers and teams. This, in itself, is a big problem.
“Your employees and team take cues from what you do and how you behave. If you display passive-aggressive behaviour, ghosting, and petty battles make you win, they follow your lead,” they say.
The report explained another big cost is the lack of loyalty, which, in turn, can lead to higher attrition.
"Research shows that workplace stress leads to an increase of almost 50 percent in voluntary turnover. People go on the job market, decline promotions, or resign. And the turnover costs associated with recruiting, training, lowered productivity, lost expertise, and so forth, are significant.”
Another employee of one of the leading startups added, the idea of missing a deadline of skipping a meeting is riddled with extreme anxiety and stress.
“I feel like a wound up top every single day at work. There is an underlying unspoken rule that you always need to be available at your manager’s beck and call. There are days when I ‘sign off’ by 7 in the evening and there are remarks and snide comments passed on how easy I have it. There is unbelievable pressure to always prove yourself at all costs. And has come at the cost of my health.”
But there is a solution. What stood out and ensured that people worked better is having a positive work culture and environment. HBR explains it is important to create and foster social connections.
Can we be friends?
A research by Sarah Pressman at the University of California, Irvine, reported that the probability of dying early is 20 percent higher for obese people, 30 percent higher for excessive drinkers, 50 percent higher for smokers, but a whopping 70 percent higher for people with poor social relationships.
It said toxic, stress-filled workplaces affect social relationships and, consequently, life expectancy.
“What works is if the boss shows empathy, is able to step away from their goals, their targets, and doesn’t view the employee as a means to an end. Otherwise, employees may simply stop trusting you, and even things that you should know and are critical aren’t shared until everything hits the fan,” said the counsellor.
A brain-imaging study found when employees recollected a boss who was un-empathic, their brains showed activation of areas associated with negative emotions and avoidance. And the opposite of this was true for an empathic boss.
“It is also becoming extremely important for leaders to lead from the front. When I personally take up the line of fire or do not throw people under the bus, my teammates are more open to me,” said another manager, on the condition of anonymity.
The HBR report backed this with a study by Jonathan Haidt at New York University’s Stern School of Business shows in his research that when leaders are not just fair but self-sacrificing, their employees are actually moved and inspired to become more loyal and committed themselves. As a consequence, they are more likely to go out of their way to be helpful and friendly to other employees, thus creating a self-reinforcing cycle.
Daan Van Knippenberg of Rotterdam School of Management says that employees of self-sacrificing leaders are more cooperative because they trust their leaders more. They are also more productive and see their leaders as more effective and charismatic.
All of this simply leads to people trusting the management and leadership more. It brings more meaning and drive among the employees.
Another employee, on the condition of anonymity, says, “I am more than willing to work round the clock, but there needs to be some benefit of that. I am not talking about monetary benefit, but the work I put in has to have significant meaning and drive. If I feel that isn’t the case, I simply don’t give even my 60 percent.”
Edited by Saheli Sen Gupta