Building the Right Culture for a Start-Up
Soaring to the heights of Apple is every start-up’s dream. Apple’s incredible run of world-changing products and its legendary founder, Steve Jobs, both continue to fuel the dreams of the founders of start-ups all around the world.
What was Steve’s biggest contribution to Apple? In an interview to the Fast Company magazine (April 2015), Tim Cook, CEO of Apple, summed up what Steve did for Apple as: “Steve’s greatest contribution and gift is the company and its culture.”
Steve’s maniacal focus on simplicity and creating products that were nothing but the best were the core values--the pillars on which he built Apple’s unique culture. With total clarity on the core values, he went about systematically recruiting those (including Tim Cook) who believed in his values. And at every turn, he demonstrated what Apple valued most by famously saying “no” to several reasonably good ideas or opportunities that did not exemplify his cherished values.
In essence, he created a culture, just right for Apple. What can today’s start-ups learn from Apple’s journey of building a unique culture?
What is “right” culture for a start-up?
There is no one right culture.
Take Amazon. It’s known for its aggressive performance driven culture, which may not find favor with all.
But Jet.com, a start-up in an identical business, has chosen to build its culture based on values that are very different from Amazon. Mark Lore, CEO, does not want any performance reviews because he thinks feedback should be “immediate and civil.” Board presentations are posted online for the entire company to see (anti-thesis to secrecy coveted by so many organizations) and nobody is required to sign non-competes (something Amazon requires from its employees) as without such stipulations “there’s more loyalty and trust” in Lore’s view.
Both Amazon and Jet.com have figured out what is right for them. Over time, their respective cultures will draw different kinds of talent, and lead to innovations and product outcomes moving in different lanes.
To build the right culture, start-up founders must deeply introspect what they care about most. If you are the founder or in the leadership team of a start-up, you have an opportunity to “wire up” your organization’s culture according to the deeply held values. Culture evolves but making a start in the right direction is a priceless move.
Two layers of culture
Essentially, organizational culture comprises two layers:
First layer: Core values
In all cases, founders typically hold a strong assumption(s), which if proved true, would drive them to success.
In Apple’s case, the assumption was and continues to be that if they focus on fewer, but extremely simple but elegant, and nothing but the best products, they would succeed.
Amazon’s assumption is that operational excellence combined with customer-centricity would produce success.
Zappos.com’s, a leading online fashion retailer, assumption is that outstanding customer service would drive their success.
These assumptions are “core values” that define the basic character of these organizations and their culture’s distinctiveness.
The core values, in turn, drive many other aspects of an organization--from the kind of talent one attracts to product and service decisions to the type of organizational structure. Notice how just one aspect of culture-- core values--makes wide-ranging impact.
As the founder or leader of a start-up, one needs to intensely focus on this top layer of culture by asking this simple question: “What is our core value(s) or assumption(s) that will drive our organization towards success?” In a practical sense, will you stand by these values when faced with stark choices? Is it your lighthouse?
While founders and leaders can craft any number of such core values, it is advisable to be as precise and focused as possible so that they remain truly powerful.
Second layer: Cultural attributes
This is the second layer of culture, which brings alive the core values in a day-to-day business sense. This is what we really see or sense when people perform their roles, take decisions, attend meetings, ask for each-other’s help, serve customers or react to problems and challenges. Not only people’s behavior, but also the organizational processes reflect the cultural attributes. In other words, core values must cascade to cultural attributes (people’s behavior) and processes, and all of these elements must align with one another.
Consider a core value like “result-orientation”. It can have four attributes: meritocracy, accountability, rewards & fairness and speed of decisions & actions. And we can also expect hiring and performance management processes, for instance, to reflect these attributes.
When core value(s) and cultural attributes are combined, they produce a unique identity that can be summed up as “culture”.
A strong, distinctive culture attracts talent and willing business partners, helps distill difficult choices, frees up leadership from micromanaging and fills the organization with positive energy. It has unparalleled power to shape a start-up’s destiny.
But it all starts with this simple question: What do we value most? And to build the right culture, like Steve Jobs, one needs to carefully and precisely answer this question.