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Culture Isn’t Kumbaya Stuff

Culture is one of those things in Silicon Valley that has become nebulous. Everyone wants to have a great culture, but few really understand what it means and how to build it, outside of ping-pong tables and weekly happy hours. Justin Moore, CEO of Axcient, believes that culture, more than anything else, is the key defining attribute of success in tech and must be built starting on the very first day of a company’s life.

“This is not about fuzzy, holding hands around a campfire, kumbaya stuff. That’s not what values and culture and mission is about. This is about building an organization for success. This is about winning. This is about doing the tactical things to make sure your organization and your people are aligned around the same thing."

Culture Can’t Wait

When you’re small, it seems like great culture should just create itself. You hire people that are like-minded, you interview everybody in the same way and you work hard. You think outstanding culture will be a byproduct of those choices. Moore is adamant that this isn’t true: “Start-up founders often say, “Look, when I’m five employees, I don’t need to invest in that culture stuff. I need to focus on product. I’ve got to get the product right. Then, I need to focus on sales strategies. This stuff can come later.” However, Moore argues, “the problem is that, even at a start-up, you do have a culture and a values system, but you may not be in control of it.”

If the CEO doesn’t set the tone for the company’s culture, someone else — or some other factor — will. It can easily turn into disfunction. Moore explains that it’s best to “lead from the front,” to be intimately involved in setting the tone of ethics, work focus, hiring and personal integrity. He compares a company with a strong common culture and sense of purpose to a well-captained sculling team: everyone rows in the same direction, with similar intensity, with a deep bond of mutual trust to bind the group’s interests together.

Mean What You Say

In 1997, Enron sent out a regular shareholder letter. On the first page of the letter, Enron listed its core values. Number one was “integrity.” The company even had it carved into the marble at its headquarters building. Values only matter if you live them on a daily basis. You must be willing to hire and fire by them. “You need to be willing to make the tough decisions. It’s not OK to have a star performer, your best sales guy or your best engineer, who doesn't adhere to your values. That’s like what Enron did. There can be no exceptions,” notes Moore.

At a company, values only matter if you actually do something with them.

Hiring + Culture

Moore has found that staying involved in the actual interview process for as long as humanly possible is one of the best ways to maintain a consistent culture through growth. “Staying involved says that people are important at this company, that culture is important, that hiring the right people is important, that the CEO takes a hands-on approach,” says Moore.

Of course, as you scale, if the CEO is involved in every hiring decision, you’re going to hit a breaking point — which, for Moore, was at about 75 people. Given this constraint, he transitioned to interviewing all managers instead of all contributors. It might be only a résumé review and 15-minute interview, but Moore makes certain to touch all managers during the interview process. “You are the leader of the company. You should know better what the culture is, what the type of person is that you're looking for, and you need to be screening for that in the early stages to protect your culture, so you need to lead from the front,” Moore explains.

‘Inundating’ Employees With Culture

Another key challenge with culture is consistency. You need to communicate your company’s values to employees early on and often; it should be a constant drumbeat.

Those touch points include employee on-boarding, quarterly/annual reviews, email, all-hands meetings, interviews and even employee-of-the-month awards or regular celebration rituals. Now — hold on a moment. How is it possible to give people such prizes without provoking snarky comments and snickering from the other employees?

Moore was initially skeptical when his team approached him with the idea for a monthly award, but he’s been surprised at how such a common celebration has built camaraderie within the workforce. The stakes are made a bit higher by an award of 500 shares (plus an acrylic prize to display on their desk) to each winner. It’s become a way for peers to recognize eachother's contributions and for the company’s employees to reinforce their common culture. Nominees are peer chosen and management selects from among their nominations.

Without that effort unification is lost. You can ask dozens of different employees what the company’s culture is and find that each person will respond with something unique. A good way to figure out how engrained your values are is to take impromptu verbal surveys — if more than 80% of the employees can repeat the company’s stated values almost verbatim, something is working.

Moore uses biannual surveys and benchmarking to figure out how people feel about the organization. As a leader, this not only gives you a sense of how you’re doing, but it also allows employees to feel responsible and to be a part of improving the culture and the company.

Moore also uses weekly one-on-one meetings between managers and employees to figure out how to improve culture. “You're not just managing a team, you’re managing individuals. You have to understand those individuals, so giving people constant feedback and consistent feedback on how they’re doing, what they’re doing well, what they can improve on, how they’re adhering to the values is critical.”

Since all employees are aware of the company’s common values, and managers are always reinforcing that message, they know how they stand, relative to the common ideals and built-up knowledge within the company. It builds accountability of employees to managers and of managers to their reports.

Moore also does skip lunches once a month to meet with a representative from each department of the company to talk about how to improve the organization itself. To encourage people to be as honest as possible about potential improvments, the suggestions stay confidential within the meeting. Moore says that he implements about three out of every twenty suggestions, and that it encourages employees to be always thinking about how they can enrich the culture, to maintain what Moore calls a “ruthless focus on a mission.”

Trust & Transparency

High-performance cultures are tied to trust. If people on your team don’t feel like they’re trusted and empowered, you can’t expect creative thinking and proactive problem solving. In Moore’s experience, you get trust through transparency. For the first time in Moore’s career, he made the decision early on to share the entire board deck with the team after each board meeting. “This was a very scary decision. It had the financials. It had the pros, the cons.”

He went on to share, “In the earliest days, there were times when things weren’t going so well, missing sales numbers, late product deliveries, running low on cash, one month away from missing payroll, but we decided that if we were going to ask people to be part of our team, to work at an early-stage company or a growth company, to work somewhere where they were literally entrusting their entire livelihood to us, that we needed to treat them like adults, and we needed to be transparent.”

Transparency & Context Build Trust

Early on, Moore was especially worried that sharing bad news would leave his team in a constant state of worry or even worse — that many would abandon the company entirely. He discovered the exact opposite. “When we were low on cash, people rallied around the company and asked, 'What can we do? What do we need to do?' Everybody rallied around our goals, because everybody knew what was at stake, and everybody respected the fact that we treated them like adults, that we treated them like team members, that we involved them in the process of building the company. Transparency and context build trust.”

The second part of establishing trust is context. When people understand the context in which important decisions are made by the leadership, and are treated with respect, they’re going to be more likely to reciprocate that demonstration of loyalty. He provides a recent example, in which one-third of his sales force had to be let go. The typical pointy-haired manager manual would encourage him to blame ‘market conditions’ or some other gaseous factor. Instead, Moore explained that the company was changing its sales strategy, and that the terminations were part of making that possible.

Moore says, “Everyone felt like the people that we had let go were part of a family. We respect the team because team is one of our values. We didn’t treat them just like pawns in a chess game. They understood why we made the tough decisions.”

When employees have enough context to understand how their department works, how it fits into the overall strategy, and what the company’s financial condition is, it’s much simpler to encourage everyone to shift in response to changing circumstances. It reduces the number of ‘unpleasant surprises’ that result from a lack of thinking or effort among managers to communicate the context for their decisions. When people know the reasons for organizational actions, they’re more likely to be persuaded and to spread their motivation to fulfill the company’s mission to their peers.

This is also the type of leadership that requires courage from the CEO. Moore says, “It’s easy to go off and only think about product and sales and marketing with all the pressures you have as a CEO, but make sure to make time for culture.” He suggests that, like General George Patton, no leader should order someone to do something that they’re not willing to do themselves. If employees know that their leader is working with them ‘on the front,’ rather than handing down orders from Olympian heights, they’ll be more likely to find the grit within themselves to withstand the most trying times.

Moore reiterated his view with one final thought: “Make time for culture. Make time for values. Make time for creating an incredible place to work, which has ruthless focus on a mission. Get everyone aligned.”

And in case you're wondering, here are Axcient's core values:

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