Simple tools for building your company culture

August 22, 2017

Creating and maintaining culture as we grew our team from 4 to 14

The reason why most startup founders don’t like to spend time thinking about culture, is because the ROI isn’t as tangible and can’t easily be measured. As Patrick Lencioni says: “many leaders struggle to embrace organizational health [ … ] because they quietly believe they are too sophisticated, too busy, or too analytical to bother with it. In other words, they think it’s beneath them.” As we argued in the Efficient Startup, we can definitely make an analytical case for the importance of culture as a way to increase the efficiency of your team.

In the previous post, we highlighted the importance of startup culture. In this post, we’re sharing our own experience with creating and maintaining culture at Routific as we grew our team from 4 to 14. A lot of the tools presented below may feel “soft” for your taste, but if you agree with me that culture is important, I’d urge you to keep an open mind and give them a try :)

Culture is a lifestyle

One of the main reasons why building culture tends to fail is the “set-and-forget” attitude. It isn’t about publishing a manifesto that the executive team dreamed up that no one reads. Nor is it about defining your core values on your office walls that no one really understands. Culture is a lifestyle.

Culture is who we really are as individuals. Culture is about our core values as it pertains to the way we live our lives. Culture is how we behave. How we interact with people. How we conduct ourselves during meetings. How we treat friends and team members. And how it influences the way we make important (business) decisions.

And it should flow naturally in that order: bottom-up. Only then can you be authentic.

Culture is how we behave. How we interact with people. How we conduct ourselves during meetings. How we treat friends and team members. And how it influences the way we make important (business) decisions.

You cannot set a company culture, and force individuals to adapt. This leads to schizophrenia: individuals will talk about work-life balance as living two separate personas. If you’ve worked at large old-school corporations before, you know what I’m talking about. I used to work at an investment bank where everyone had their “work-face” on. Everyday was a game of poker politics. No one was acting like their true self. No one dared to freely express their ideas and opinions. No one felt compelled to innovate. It was a toxic culture to say the least.

But man, they published so many thick and verbose cultural guidelines, including a ridiculous 44-page dress code guide when I was there. This is nothow you build culture.

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Now that we’ve set the context for what culture really is and how it should feel like, let’s get into the tactical.

Building your culture

We’ll share some tools that we’ve used to build our culture at Routific, starting from the time when we were just 4 founders to the 14-person team we are today. We’re still very small — it’s not like we’ve grown to 100+ people, but it’s never too early to start. As the team grows, establishing culture becomes exponentially harder because the addition of every new team member more than doubles the total number of communication channels.

So at what stage should you start thinking about culture?

At the very beginning, the founding team is the culture. As co-founders you have committed to embark on one of the most meaningful journeys of your life, so you should have already “culturally screened” one another even before starting the company. There is a certain level of base alignment to start with and it quickly converges organically. This is usually fine.

Nobody likes to be told what to do or how to behave. But when the entire team aligns and agrees on certain core values together, the commitment to the result will be much stronger.

It’s a good time to start talking about culture as soon as you’re thinking about making your first few hires. The sooner you start the conversation, the easier the process will be. Establishing culture is not something you can do in retrospect. I mean it’s possible, but it’s really hard; especially when you realize there are misfits that shouldn’t have been hired in the first place.

Journey is the destination

It is important to keep in mind that the journey of building culture is more important than the final result. As we see in the above illustration, culture should flow from the bottom up. It is important to include every early team member in the brainstorming and decision-making process. This will give everyone a chance to speak up and contribute, which creates buy-in. Nobody likes to be told what to do or how to behave. But when the entire team aligns and agrees on certain core values together, the commitment to the result will be much stronger.

It may be a lot easier for a founder to just decide what kind of culture he or she wants, but that sets a precedence for a top-down kind of culture. Not recommended. The trickiest part of building culture is to design an efficient process through which you arrive at the final result bottom-up.

Culture tools

This is by no means an exhaustive list, but here are some important aspects of culture that we have found to be most helpful (thus far):

1. Company vision

2. Core values

3. Trust building

4. Conflict norms

5. Accountability

6. Peer-to-peer feedback

1. Company vision

This is usually the easiest part. As founders, there is a reason why you decided to start the company. Put that reason down in writing. Ask yourself: Why do you get so passionate about working on this startup? What gets you out of bed every morning?

- Why do we exist?

Even if you think you know the answer to this question, it is still valuable for you to talk about it. Make sure that you and your team align on the same raison d’etre for the company. The result of this can be a simple one-liner. And remember, it’s the “why” not the “what”. Routific’s why is “to make efficiency accessible to businesses”. We spent an hour with the entire team talking about the why. That’s 10 minutes per word. You might think that’s hugely inefficient, but as a result of the process of discussion, the entire team now is completely unambiguously aligned with what those 6 words really mean — and what they don’t mean.

- Pointy point of view

To take your one-liner one step further, you can define your “pointy point of view” — a little framework by Suzanne Muchin, one of our mentors at Techstars. It is still one sentence, but with a few more aspects to it. And it has to be pointy, i.e. polarizing. It goes like this: “We are the only <A> that <B> for <C> in an era that <D>.”

This is what we came up with for Routific 2 years ago: “We are the easiest and most modern routing solution that provides an excellent web-based service for smart delivery companies in an era where businesses MUST be as efficient as possible or DIE.”

Notice how pointy that is? Makes you slightly uncomfortable? Either you wholeheartedly believe in it, or you completely disagree with the point of view. It doesn’t matter. So long as your team believes in it. And it gives you some strategic direction.

- 2-year dream

Another fun thing we did among the founders was an imagination exercise: where do you see the company in 2 years?

We each wrote a short paragraph describing where we wanted to see the company in 2 years. We then read those descriptions aloud to one another over a nice dinner, and discussed the differences between our visions. To our surprise, we had very similar visions, which is great, but it still did bring up certain topics of discussion around how we wanted to grow Routific, e.g. do we raise venture funding now or go for profitability?

Obviously, the sooner you find out that there might be a difference in vision, the sooner you can address it. Very important.

2. Core values

This is probably one of the most important aspects of your culture. Defining crystal clear core values and living by them is how Simple Energy Founder and CEO Yoav Lurie turned his company around. Core values should drive behaviour and inform important decisions (including hiring decisions, which we’ll cover in the next post).

These are things that should be deeply innate to the company’s culture. These are values that you should never budge on. A team that is 100% aligned and committed to all your core values is a prerequisite foundation of an Efficient Startup. When a team is not aligned on the core values, it implies that different people care about different things. Over time, when people see that not everyone cares about the core values in the same way, it loses its credibility, and slowly but surely, eventually no one will care about anything but themselves. Very toxic.

- Post-its

The first time we attempted to set our core values was at Techstars in 2015. We did it in a couple hours with the six of us in a room. We used post-it notes to write down things we value personally, and extracted common themes from them. We discussed high-level concepts like “efficient”, “effective”, “respect”, “healthy & happy”. While this was a good start for a small team, these high-level concepts can be quite useless as the team grows, because they are way too ambiguous.

- Survey tools

Nearly one year after the post-it exercise, we decided it was time to revisit our core values with our team of 10. This time around we used a tool called RoundPegg — as inspired by Yoav’s talk — a piece of software that was designed to quantify something as qualitative as cultural alignment.

Each individual team member is presented with a list of ~30 core values. They choose 9 values they deem most and 9 values they deem least important. The software makes its calculations and presents the top 3 core values for your team. From there, you have a pretty good starting point for your core values. The process was completely bottom-up, and you know immediately how well people are aligned. The three values that surfaced for us: “Transparency”, “Sharing team success”, and “Professional growth” — and we had a 100% alignment score on them!

This was probably one of the more impactful things we’ve done. It gave the team the confidence and permission to fully live by these personal values, and trust that they are shared across the team. We still refer to these values a year later. It’s important to keep in mind that core values only mean as much as you talk about them, and live by them.

3. Trust building

A truly healthy organization is one where people feel psychologically safe. Google researched the effectiveness of hundreds of teams internally and found that “psychological safety” is be the biggest determinant for success. It is the “sense of confidence that the team will not embarrass, reject, or punish someone for speaking up.”

One of the best frameworks I’ve encountered for creating this kind of culture comes straight from Patrick Lencioni’s Five Dysfunctions of a Team: vulnerability-based trust as the foundation of a healthy organization.

To create a psychologically safe environment, everyone needs to be as approachable as possible. Take for example a junior, somewhat shy person A and a senior, assertive person B. If person A wants to speak up during a meeting to challenge the idea of person B — and person A perceives person B as unapproachable — then person A will just keep their mouth shut.

Before anything can happen, person A needs to speak up. But before that can happen, person B needs to be perceived as approachable. One way to increase approachability is by being vulnerable. Being vulnerable builds trust. Once trust is established, persons A and B can engage in productive conflicts for the greater collective good.

- Storytelling

We did a great exercise of vulnerability during our first company retreat. We went around the room, and each of us shared an interesting childhood story that shapes the way they are today. If you haven’t done this before, I would highly recommend it! It feels good to share. And the team gets to know one another on a whole different level. It makes you understand situations from their perspective. We all see each other as vulnerable human beings. And we start to treat each other better.

- Manage your trust fund

Trust between two people is like a bank account. You need to make deposits before you can withdraw from it. You make deposits by being vulnerable. You withdraw as you engage in conflict in some shape or form, like giving someone feedback on their behavior or challenging someone during a meeting. You need to be constantly mindful to keep depositing to your “trust fund” by being vulnerable on a daily basis. Sharing a vulnerable story from your childhood to the entire team is a way to make a lump-sum deposit; the more vulnerable the bigger the deposit.

Trust between two people is like a bank account. You need to make deposits before you can withdraw from it. You make deposits by being vulnerable. You withdraw as you engage in conflict in some shape or form, like giving someone feedback on their behavior or challenging someone during a meeting.

You should continue to make small deposits on a daily basis. It can be as simple as admitting your mistakes to the team, sharing a tough client call you just had, or a recent struggle from your personal life.

Having some trust capital doesn’t mean that you can be a complete jerk. You’d overspend your capital pretty quickly! And once you get in the red, interest payments are pretty hefty. Trust takes an especially long time to regain when you overdraw, so be extra careful with conflict if your trust fund is running low.

4. Conflict norms

Once you build trust, you can engage in productive conflict. Productive conflict can be in the shape of a brainstorm meeting, a (passionate) debate, providing peer-to-peer feedback, challenging assumptions, holding each other accountable, etc. All of the above activities require the withdrawal of some capital from your trust fund. The intensity of the conflict dictates how much. In order to minimize the perceived intensity, you can set conflict norms.

- Myers-Briggs

We completed the Myers-Briggs personality test with the entire team; it gave us phenomenal and actionable insights into the different personalities on our team. It changed the way we talk to each other and how we run our meetings. Every person on your team will have different personalities, and quite likely also have different preferences for conflict engagement. In order not to hurt anyone, it’s important get to know their personalities and their preferences.

- Conflict norms

Deciding on a set of common conflict norms can also help; it makes people feel more explicitly aligned knowing what the ground rules are. These can be set in a quick meeting with the entire staff, or perhaps gathered asynchronously using a survey tool. A tiny investment of time, with tremendous value in the long-run.

Here’s what we came up with as a team:

- Assume positive intent
- Be mindful of differences
- Ensure clarity & closure
- See something, say something
- Silence = dissent

The last one deserves expounding: how often have you been in a meeting where you actually didn’t fully agree with the final decision, but you didn’t speak up? Meanwhile the person running the meeting concludes with: “Alright, so the conclusion is that we do X. Any questions? No? Great! Let’s ship it!” And we leave the room unaligned. The common misconception is that silence equals consent.

At Routific we will assume that silence equals dissent. So we will go around the room and get explicit, verbal buy in. i.e. one-by-one, everyone in the room says ‘yes’ or ‘no’. This gives individuals a chance to speak up, and allows the team to “mine for conflict” — if there seems to be a slight hesitation, we will dig it out. All cards need to be on the table to make the optimal decision, and create the strongest buy-in. In an upcoming post, we will discuss how to run efficient meetings.

At Routific we will assume that silence equals dissent. So we will go around the room and get explicit, verbal buy in.

5. Accountability

Holding each other accountable is a very hard thing to do. We don’t want to come across as distrustful or micromanaging. There is a fine line between micromanaging and accountability. Breathing down someone’s neck and checking over their work is micromanaging. Calling someone out for not doing something they committed to is accountability.

When we did the Team Assessment, we scored quite high overall compared to the benchmark, but uncovered that we could definitely improve on accountability. We’re all very humble and nice people at Routific, so it’s not easy for us. But we have committed as a team to improve on this. Which means that we have explicitly given every the permission to hold each other accountable — without needing to feel bad about it.

6. Peer-to-peer feedback

In an ideal world, everyone gives each other feedback on a daily basis. The more you give, the more others will give, and the more you will receive. And who doesn’t love feedback? Everyone wants to become a better version of themselves.

This ideal is extremely worthwhile, but very hard to attain. It requires a tremendous amount of trust across the entire team and a lot of practice, because giving feedback is not easy.

Receiving feedback is like receiving a gift, so it’s important to say aloud: “thank you.” Profusely. It is also important not to become defensive and start explaining. Just listen, acknowledge, and be thankful.

- 1on1s

Having regular 1on1s with your team is awesome. It’s a great venue for feedback, and it can go both ways. As a leader, you can show vulnerability by soliciting feedback first. How can I improve as a CEO? What advice do you have for me?

Receiving feedback is like receiving a gift, so it’s important to say aloud: “thank you.” Profusely. It is also important not to become defensive and start explaining. Just listen, acknowledge, and be thankful.

- Feedback sessions

At the end of our two-day retreat in Whistler — after we built a lot of trust through some of the above exercises — we did a company-wide feedback session. Each team member writes down a few lines of feedback for every other team member: one thing they should keep doing, and one thing they can improve upon.

As the CEO, I was first to receive feedback. We went around the room and everyone shared their piece of positive feedback. It butters you up for the real meat :) After that, everyone shared one thing I can improve on. I learned a lot. I now know how I can become a better CEO for my team.

Next, it’s time to write your commitments. Based on all the feedback you received, write down what you want to actively improve. Start your sentence with: “I commit to…”

We collected everyone’s commitments in a document, printed it, and stuck it on our kitchen wall. Our commitments are public, and our team members give each other permission to help them and to hold them accountable.

You can do these feedback sessions once a year or once a quarter as a practice, but eventually you want to move towards a real-time feedback kind of culture. As leaders you set the example. So make sure you give a plenty of feedback regularly so it becomes a norm!

If feedback still isn’t free-flowing, the other thing you can try is ask for “advice” instead of “feedback.” Might frame it in a more conducive way :)

Our commitments are public, and our team members give each other permission to help them and to hold them accountable.

Keep culture alive!

We’ve shared a number of simple tools you can start to experiment with. Depending on the size of your startup — and the current state of your culture — some tools may be overkill. And if you’re a huge team, it might be much harder to involve the entire team with certain things — although it is definitely possible. Mark Achler, previously an executive at Redbox, once told us a story of a company-wide off-site where they reestablished their core values bottom-up, with a few hundred employees. It caused a complete cultural shift; it even caused some self-selection. Certain team members realized that they are not a good fit for Redbox and voluntarily left the company on good terms. The remaining team ran so much more efficiently after that.

The tools we shared are things to get you started. The Advantage is a great book and highly recommended. We also worked with Hrishi Baskaran to help us get the most out of our first company retreat. In fact, a lot of the above tools were his ideas!

I’d love to hear from fellow founders what kind of tools have worked for you. How have you gone about building your culture? Please share in the comments below!

It’s important to remember that culture is a lifestyle — you need to live by it to keep it alive.

“Culture is in the stories we share, not in a mission statement on your website.”
— George Hu, COO of Twilio