A start-up is essentially a business which focuses on fast growth and operates in insane uncertainty. In this space, success is a combination of vision and execution, both driven by a group of people who bond over scope and culture.
“Any jackass can kick down a barn, but it takes a good carpenter to build one.” Sam Rayburn
This is one of those strong quotes you will remember from the The Culture Code by Daniel Coyle. Coyle writes about building organisational culture, but opens with the etymology of the Latin word "cultus", which means "care".
Moving fast and caring are usually clashing notions. As the 4th industrial revolution has come upon us, the cult image of fast-growing businesses, with their drummed up successes and hushed flops, combined with the birth of VCs, incubators, and crowdsourcing has led to a competition like never before.
Today, a successful entrepreneur requires a certain combination of clear vision, and an astute sense of the implicit dynamics and connectedness to the team behind. They will be recognized as authentic when openness, honesty, and steady beliefs are the constant behind any interaction.
Harvard Business Review has called authentic leadership the gold standard of leadership.
Many of the successful cultures were forged or, at least, crystalized in a time of crisis. Because building a culture is not coming from company meetings and memos, but from the ever-evolving cycle of trying, failing, reflecting, and above all, learning.
There are 3 pillars that stand out as common throughout the history of the most successful organisations.
1. Showcase desired exceptional behaviour
Exceptional behaviour is formed by challenging the status quo with respect to the way things have been done for a long time and creating new rituals on team or department level that translate the big picture vision.
Creating a culture of exceptional behaviour means focusing on relentless innovation while harnessing individual creativity. Speed and margins are important, but they will multiply by elevating everyone's expectations of what good skill or behaviour means.
To create a culture of high performance, creating alignment between teams is crucial. As such, companies need to provide a direct line of feedback between employees and leaders. An authentic culture is always built from the top down. And decision-makers need to use that feedback into the way the business operates to nurture high-performing and engaged employees.
2. Make people feel welcome (there is strength in diversity)
The hiring process, your onboarding, communication, growth and promotions, talent management programs, and goal setting need to be a high-intensity feedback loop.
Employees are your first source of truth most of the times when it comes to the quality of your products or services, whether they are clients themselves or the first receivers of client information.
A Salesforce report shows that employees who feel their voices are being heard are five times as likely to feel empowered to perform their best work.
Creating a space for employees to express themselves will determine if they are engaged and willing to share critical insights. Only then the curiosity of how you can improve the organization together will offer value.
3. Align language with action
While the water cooler moments have their value, in an ever changing nature of work that is more fast paced, more global, and more layered, creating the same known universe is critical and can be done only through consistency.
That PR memo needs to be communicated internally first, and re-organization needs to be explained using the same arguments, no matter where they come from – that anti-discrimination or sexual harassment charges need to be investigated, and that performance or product feedback is valuable only if followed up with actionable items.
It is easier said than done because for all the values above to create an authentic culture, they can easily be stifled by behaviours that break the stride of even the most promising businesses.
Some of the biggest obstacles in scaling is attachment to legacy.
Psychologist and economist Daniel Kahneman and cognitive and mathematical psychologist Amos Tversky bring to light the concept of loss aversion, that can be expressed in certain dimensions by sunk-cost fallacy, status quo bias or the endowment effect, which summarized would sound like “losses loom larger than gains."
The prospect theory which drives the phenomenon of loss aversion showcases how people make decisions based on the prospects of a decision (essentially, the potential value of losses and gains) rather than on the final outcome.
This really just means that when people have lost money, they’re willing to take more risks in the hope of recouping the loss. Similarly, when they've already profited, they’re more cautious to not lose their gain.
In the start-up life, change seems the only constant. Getting comfortable with the status quo is far from being an easy task and requires a certain elasticity of the cultural mindset.
At the same time, too much inconsistency, brutal changes, or even misplaced internal competition will confuse and create mistrust.
All recent studies on why people stay engaged in an organization, despite tremendous obstacles, lead us in the direction of shared authenticity.
When people feel confident that their peers live by the same values, they make bonds and connections that are sparked by curiosity, mutual respect, and meaningful communication. They find mentors, mentees, friends, they build purpose and rewarding interactions, and they bring value they feel proud of to a wider audience.