Starting a new technology company is exciting. Since the founders have their energies fully focused on new technologies and innovations that promise to change the world, there is little time left for them to think about creating the right culture for the company. Hence, more often than not, the company’s culture takes after the styles and personalities of the founders. (Above, CollegeHumor’s startup guys.)
While there is nothing wrong with that, it can be a limiting factor in the growth of the company, especially if the company succeeds and starts to grow out of the initial startup phase, and begins its journey toward an established company. Because the culture influences the type of talent the company attracts, if the culture is set in a limiting way, the company struggles to get the diverse talent outside of its core group that it needs to function as an established business.
For example, many times companies started by young males in their 20’s take on their personality, and the culture is defined by a highly informal shorts and sandals dress code. Typically, work hours are anything but nine-to-five and include frequent visits to local watering holes.
While it is a very comfortable setting for twenty-something males who see it as a continuation of their fun and free college lifestyle; the result is predictable. The company attracts more talent of the same profile and not a more diversified workforce. This works well in the early days when the core technology is being developed and you may not need much more than a bunch of guys willing to churn out the initial software. But it becomes a hindrance to attracting more diverse talent, which is necessary when you start to grow the business.
The reverse is also quite common, where older founders create a more staid and formal culture of button-down shirts and strict policies. As a result, they struggle to attract top-tier software developers who prefer a more relaxed setting. While this challenge of setting the right culture exists in any technology company, it is more pronounced in enterprise software startups where the company must strike the right balance between relaxed and cool and the more mature grown up culture.
One of the mistakes many founders make is that they overlook the good aspects of what larger companies do. It’s perhaps more prudent to carefully look at the good aspects of large company environment and incorporate those into their startup company’s culture.
Here are a few ideas on how to set the right culture.
1. Be proactive in determining the work culture and the image you want to project. You want to set the culture primarily to be attractive to the employees and customers. So think about what type of work environment will attract the right employees and how will those employees and the company culture appear to your potential customers.
2. Instead of dictating a specific dress code or work hours, make suggestions but provide flexibility in how people dress depending on their roles and work situations. Make the hours they work dependent on their job requirements. Include these in the employee handbook if you have one because if you don’t, the default culture will be set by how founders and key employees dress and work. It is probably best to give specific departments control over their dress code, work hours, and work settings.
3. Don’t overlook traditional employee benefits. Many founders are wary of providing healthcare and insurance benefits simply because either those aren’t important to them (which is true for most twenty-something males) or they’re afraid of signing up for the costs. Interestingly, the healthcare costs for a company full of young males are much lower than for a company with a more diverse and older workforce. So by providing those benefits at a relatively low cost, you can make the company attractive to the broader workforce that the company will surely need sooner or later.
4. Take time to figure out the values and principles that should drive the company. If it is innovation, creativity, excellence, then write that down. It is also a good idea to come up with moral or ethical guidelines that tell employees how to conduct themselves when working with each other and their customers. For example, if honesty, respect, and teamwork are important to you, then include those. A good set of values not only tells your employees how to conduct themselves but can become a strong branding tool for the company. Google’s “don’t be evil” tagline is a great example of that.
5. Involve employees in defining the culture of the company. Company culture should and does evolve with the growth of the company and over time. If employees of the company actively participate in building the culture, then it thrives and gets better over time.
A company culture isn’t something that a startup will figure out overnight. But apart from the world-changing technology they plan to develop, their company’s culture will be the most important key to their lasting success.
Zikria Syed is the CEO and co-founder of NextDocs, which provides SharePoint-based compliance solutions including quality management software, regulatory document management, and clinical portals.
VB's research team is studying web-personalization... Chime in here, and we’ll share the results.