I’ve seen some interesting conversations around organisational culture recently.
This week airbnb founder Brian Chesky shared his internal note ‘Don’t fuck up the culture’ on Medium. ‘Don’t fuck up the culture’ was the advice investor Peter Thiel had given airbnb. One of the reasons he invested in them was their culture, but he also warned once a business gets to a certain size, it’s inevitable they “fuck it up.” Chesky wrote:
“The culture is what creates the foundation for all future innovation. If you break the culture, you break the machine that creates your products”.
Then Scott Berkun weighed in with this critique of Chesky, where he argues that most organisations ends up screwing up their culture:
“There is a presumption among many executives that culture is an asset created and managed like technological resources, which is a mistake. Culture is emotional. ... It is hard to describe culture rationally or in the same easily measurable terms the business world operates on, which explains why so many attempts by business leaders to control and scale culture ultimately fail”.
Berkun is right; too often within organisations ‘culture’ is intangible. It’s there, everyone can sense it and recognise it, but if it’s not captured, how can it scale?
Culture is important for every business, not just tech startups. It remains the reason why people work somewhere, and why clients choose a business. I’ve seen many businesses where people working there knew there was something special or distinctive, but they hadn’t stopped to identify it. And if you haven’t grabbed hold of it, labelled it, articulated it, then you risk losing it.
Of course, your culture will change as you grow and hire new people; a 1,000 person business can’t retain the intimacy of a twenty person business. But I don’t agree culture doesn’t scale. Look at what Tony Hsieh did with Zappos: how he famously created a large organisation united by a common culture and spirit. Why did that work? Because Hsieh was clear at the outset about the values of the business; he instigated a Culture Book which fed back and captured what was special about working there, created by workers from every part of the organisation.
Businesses fail at scaling culture because they don’t appreciate what they have in the first place. I worked with a small successful business that made that mistake. In their formative years they developed this great culture where everyone from the CEO down took full and collective responsibility for what happened in the business. Everyone answered the ‘phones; when a courier turned up anyone who happened to be around would sign for a package; people in finance and admin roles stayed close to the core of the business and ‘got’ what the business did, they knew who the clients were, so they could engage with them too. This created a really strong culture that came to define the organisation.
But as the business grew, it was decided that there needed to be more organisational structure. A mantra of ‘that’s not my job’ was encouraged to focus on individual responsibility, office walls went up, other people beyond the founders took responsibility for hiring. When it was small, the founders interviewed every hire; when other managers did the hiring, they chose people who could do the job, and not those who reflected the culture and unique spirit of the place.
Departments became fragmented. The passion got diluted. You might put some of this down to symptoms of ‘growing pains’, but ultimately it lost its unique spirit because it hadn’t grabbed hold of it and realised how precious it was. Because it lost its spirit internally, externally it also lost its special ingredient that clients had fallen in love with.
So Thiel is right - don’t fuck up the culture. If you need it, get an outsider's help ( a professional outsider like me) to capture your culture; to make it less ethereal, more tangible. Once you have it nailed, use it as a compass to help navigate decisions across the business; from hiring new staff to setting up new premises. Your culture is such a huge asset, it mustn't be taken for granted.
If you value it, you’d better capture it while you can.