Culture in Start-ups

April 1, 2016
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by Zenobia Sethna.

Start-ups are high growth and inherently stressful. 2015 was the year when the Indian startup industry bloomed as well as got a reality check. A critical ingredient is hiring the right people at the get go, ones that not only have the right skillsets but also fit in nicely into the overall company culture. But what makes up the culture in a start-up?

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Why you need a strong culture?

Culture guides discretionary behaviour and it picks up where the employee handbook leaves off. Culture tells us how to respond to an unprecedented service request. It tells us whether to risk telling our bosses about our goof-ups. The culture tells employees what to do when the CEO isn’t in the room. While the work itself may be gruelling, the culture should be designed to alleviate work related stress and sustain employee enthusiasm.

You are not your perks!

Many people confuse “culture” with, basically, freebies on offer at the workplace. Ex-Google employees reminisce fondly of subsidized massages, afternoon volleyball breaks, bowling alleys and basketball courts and free food. But as much as Google’s headquarters brim with on-site benefits, the true formula behind their success lies in the intangible: an organizational culture that is the archetype for every company across all industries. Perks seem great at the start, but they tend to lose their luster over time, leaving you with nothing substantial to engage and excite. Additionally, many startups lack the capital to offer these types of perks, let alone sustain them over time, putting them at a disadvantage compared to their larger, more established competitors. Finally, perks and incentives are, by their nature, a manifestation of the core values of an organization.

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80% of a company’s culture will be defined by its core leaders

In a startup, the founders define the culture. As a founder, the things that set you apart become your company’s competitive advantages in hiring. The earlier you think through and articulate what makes you different from other people — whether it’s an attitude or a skillset — the better you’ll be able to take advantage of these qualities from a business perspective. Vipul Parekh of BigBasket says, “Founders need to drive the right behaviours by demonstrating what they are and by the type of people they recruit and the practices they reward.”

When Facebook first started to grow, Mark Zuckerberg spent time asking other CEOs about some of the things they did early on at Microsoft, Apple, and others to establish culture and explain to people what it meant to work there. One of the most poignant pieces of advice he got was to write down a succinct list of what it meant to be “one of us.”

When Molly Graham joined Facebook in 2008 as the Chief Operating Officer, with 400 employees serving 80 million users, she was tasked with not only being the external face of the company but also building a shared vision and identity in the midst of tremendous growth at Facebook. For Facebook and Graham, culture was all about staying true to the company’s early identity and giving people the momentum to stay creative through hyper-growth.  She started by asking two questions:

1) Who do we want to be when we grow up?

2) How do we talk to people outside about what it’s like to work at Facebook?

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What are your core values?

Values can have deep and lasting meaning for people, giving them a higher purpose. If you are a founder of a start-up evaluating your own culture, ask yourself:

  • What are my strengths?
  • What am I outstanding at?
  • What do I value in the people around me?
  • When I look at my friends, what is the characteristic they all have in common?
  • What qualities in a person drive me crazy/ are intolerable?
  • What am I bad at?
  • What would I want written on my tombstone?

According to Rand Fishkin, CEO and founder of Moz, “If you’re trying to figure out what a company’s values really are, look at the decisions management makes when lots of money, risk, or loss of face for executives is at odds with the stated values. Want to know the company’s mission & vision? Look at what they’ve intentionally chosen not to do, even though it could be lucrative.”

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Intangibles that really define the work culture

Founders really enjoy running start-ups because of the autonomy and freedom to do their own thing. Why not ensure this thrill goes down all the way to the most junior employees?A great startup culture also allows for a more inclusive dialogue between employees at all levels. For instance, CEO and Founder of Invention Labs, Ajit Narayanan, insists on having a strategy retreat every quarter where everyone right down to the office boy participates.

No one has all the answers ever. A company where only the management makes all the decisions is a sure fire way to send your gifted employees to your competitors. Companies have greater success when employees are given autonomy and decision making power that isn’t governed by hierarchy. Interestingly, in India, even though a workplace may be “informal”, most would agree that decision making is still hierarchical and a “Your boss is always right” mentality still very much persists, which needs to be done away with.

Resilience, or the ability to reframe challenges and minimize the negative impacts of stress, is a critical component of any start-up culture. There are bound to be setbacks, fights and struggles. A resilient culture gives employees the tools to stay strong in the face of challenges and to bounce back from obstacles and the natural roller coaster experience of working at a startup.

We all know that employees need to be appreciated for their achievements, but companies with outstanding cultures encourage risk taking, and, yes, more mistakes. More risk, while intimidating, means more fresh ideas that may be what a company needs rise to the next level. A fearless office culture, where employees can come forth with their errors without fear of reprisal, is always appreciated and encourages everyone to think out of the box. When Googler Sheryl Sandberg made a mistake that cost Google several million dollars, she admitted her error to co-founder Larry Page, whose response sums up the company’s attitude on failure: “I’m so glad you made this mistake,” he said. “Because I want to run a company where we are moving too quickly and doing too much, not being too cautious and doing too little. If we don’t have any of these mistakes, we’re just not taking enough risk.”

Communication is equally important. If you don’t know why you get out of bed each day to go to work, neither will anyone else. Tell everyone what you value, why you value it, and make sure you actively follow through by acting on it.

Lead by example – However charismatic you may be at articulating your vision and values, it will fall on deaf ears soon if you do not truly live your words. What you do is more important than what you say. If you want your staff to be punctual, be punctual yourself.

Being transparent is another trait all startup cultures aspire to. So is ownership. Board meetings are held in front of the whole company. Opening up sensitive information for all to see enables the dissatisfaction to be open as well—and then resolved.

Finally, in order to sustain the hard-won work culture, we also need to ensure we retain employees and continue to attract skilled employees who share your common values. A water-tight hiring and selection process to check for qualification as well as cultural fit is a must.

Start early!

The earlier a culture is defined and set, the better – ideally when you are 10 members or less. Many first-time startup founders struggle to devote time to define their culture from the beginning, only to come to the painful realization that culture certainly has an impact on the operational side of business.

Imarticus Learning is one such start up company that has grown to achieve many accolades such as being a Leader in SAS & Python training, being #1 among top 5 big data and Hadoop training institutions, Education Excellence awards, and more. Imarticus offers financial analyst courses and business analytics courses in India.

www.imarticus.org

 

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