Santa Cruz Tech Beat

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Company culture in your startup: It’s a founder’s job

By Sylvana Rochet
Founder of The Insightful Executive
Special to Santa Cruz Tech Beat

October 27, 2016 — Santa Cruz, CA

(Photo above: Sylvana Rochet is a Santa Cruz-based consultant and coach. Contributed.)

“Culture is the soup that every person in the company is swimming in. So the best bet is for you, dear founder, to put culture-shaping in your list of things to lead, and to devote time and energy to.”

Company culture is at the heart of my work with clients in the startup & tech world. It inevitably comes up at some point with every founder and exec that I coach individually. Lately, when asked to define culture, I’ve brought up the recent Wells Fargo (WF) scandal to help illustrate what it is and why it’s so important.

We’ve seen the senior leaders at the big bank claim that the 5,300 fraudulent employees were “bad apples” and not representative of what WF stands for. These leaders pointed to company manuals and vision statements and used these as a cover, saying “all these elements tell our employees that fraud is not okay here.” But what these leaders failed to understand is that culture is not set by your company manual or vision statements on the walls. In healthy companies, sure, these tangible elements are a reminder of it, but culture is really set by the everyday, subtle and not-so-subtle ways in which the company operates.

Culture is the soup that every person in the company is swimming in.

It’s defined and solidified, over time, by things like:

  • What’s rewarded and celebrated
  • What management addresses as “problems” and what gets punished
  • How employees treat one another & their clients
  • How managers treat team members. Do they coach and mentor? Or are they fulfilling a mere “policing” function?
  • How senior leaders behave and speak, informally, day to day. How they set the “tone” in their actions as they go about leading the business
  • How people get promoted, and what is valued in employees’ performance
  • How the CEO and the C-suite go about finding out what truly goes on in their company. How do they combat the “Ivory Tower Syndrome”? (and do they even care to do so?)
  • How do employees feel about their job?

All these elements point to a couple of key things:

  1. Culture is reflected in every aspect of a company, at all levels.
  2. A company’s culture is mainly defined by its core leaders.

This is what the leaders at WF failed to do. They did not take responsibility for setting and maintaining the company’s culture and this eventually cost them dearly as leaders, it cost the company not only money but its reputation, and it cost many employees their jobs.

Luckily for my startup and tech clients, they aren’t leading companies with 250,000+ employees like Wells Fargo so, one might think it’s easier for them to be highly involved in shaping culture. But that’s not necessarily the case. Often, these founders find themselves engulfed with the tasks of scaling quickly: shipping product to a fast-growing clientele, fixing bugs along the way, hiring key associates, raising money, being the company spokesperson (public speaking, media and PR), being Chief Problem-Solver because they struggle to delegate the technical stuff, and filling in the gap where needed because this is their “baby.”

Being intentional about defining the culture (and being strategic about how they set the one culture-wise) is not something on their to-do list. They understand it’s important, but they’re hoping culture will somehow shape itself in the right way as the company grows. Unfortunately, it does not, and this is when many of my clients first approach me. When they start to feel like the “soup” that the employees are swimming in does not reflect the culture they had in mind when they founded the company as a small group in a garage.

What does this misalignment look and feel like? It can be when the founders find themselves saying things like: “I don’t feel like the employees take ownership for their tasks or problem-solving” or “I feel like what’s being communicated to the company is not being taken into account”. Another clue might be that the core leaders aren’t hearing about problems until they’re big issues for the business, or when a number of employees are “hoarding” work – which could indicate a lack of feeling secure in their role at the company. This matters because any of these are going to cost the company in terms of productivity, time, morale, retention and, ultimately, revenue.

So the best bet is for you, dear founder, to put culture-shaping in your list of things to lead, and to devote time and energy to.

Here are some prompts to help you define it:

  • What are your personal values as a founder? What drives you?
  • What do you, as a founder, want to contribute to the industry and be known for?
  • What do you want your employees to say about working at your company?
  • What do you want clients to say, not only about your product, but about interacting with your company?
  • What’s the look-and-feel of it for the client?
  • What types of personal qualities do you like to see in the folks you hire?
  • What are some of the mottos or “mantras” that people at the company live by? These can even make their way into jokes at the company (like Apple’s “Surprise and delight”) but they are weaved into the collective psyche as what you all stand for.
  • How will you and the core leaders reinforce the above, in a way that truly feels like you are living and modeling it consistently, and thus inviting everyone to do so as well?

And, please, for the love of your company, do not hand-off culture to your first HR person. This is your responsibility as a founder, and while HR folks can help you implement it, you are the one defining it. Always.

For those of you who would like to dive into this topic more deeply, I’ll be teaching a free workshop organized by Santa Cruz Works, on January 17, 2017. I look forward to seeing you there!

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Sylvana Rochet, founder of The Insightful Executive, is a Santa Cruz-based consultant and coach.

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