Every month for the past two years, I’ve posted three types of culture inspiration: a visual, a book, and an article to bookmark.
Now that my book, No Hard Feelings, is coming out in January, I’m focusing on our book newsletter (you can subscribe here). So, I’m moving to writing this newsletter quarterly. I’ll be sharing helpful summaries and excerpts of the best books, podcasts, and articles about culture.
Book: Blitzscaling: The Lightning-Fast Path to Building Massively Valuable Companies by Reid Hoffman and Chris Yeh
From Reid Hoffman, co-founder of LinkedIn, and Chris Yeh comes a fabulous book that asks the question: “What separates the startups that get disrupted and disappear from the ones who grow to become global giants?” The secret is blitzscaling: a set of techniques for scaling up. (The book is based on the popular class at Stanford Business School that Hoffman and Yeh teach.) Hoffman and Yeh break down the five stages of blitzscaling:
Stage 1 (Family); 1-9 employees
Stage 2 (Tribe); 10s of employees
Stage 3 (Village); 100s of employees
Stage 4 (City); 1000s of employees
Stage 5 (Nation); 10000s of employees
I love this distinction— it helps to break down the differences in what an organization needs in terns of culture and leadership at each stage. One of the techniques in the book is management innovation. Here are some of the key transitions that management must make as an organization scales:
Small to large teams: “Small teams can operate spontaneously and informally thanks to the personal relationships and frequent contact between team members.” As an organization grows, its team grow larger, and they can’t operate spontaneously and informally anymore. Early employees may have trouble adapting to the fact that they are not involved in every major decision anymore. “The answer is to… create other systems to help them feel connected to the company’s mission.”
Generalists to specialists: In the family stage, everyone is a generalist who “can get many different things done in an uncertain and rapidly changing environment. But as the company grows, it needs to shift to hiring specialists who are less fungible but have expertise in an area that is crucial to scaling the organization.”
Dialogue to broadcasting: Evolving the communications processes in an organization is one of the most important but least paid attention to shifts. “As the company grows, you have to shift from informal, in-person, individual conversations to formal, electronic, “push” broadcasting and online “pull” resources. You also have to shift from sharing all information by default to deciding on what is secret and what is shareable.” Tribal organizations should have well-organized “all-hands” meetings and rituals. At the village stage, this is easier done through videoconference (as LinkedIn does) or email. “Brian Chesky addresses this need at Airbnb by sending a long email to every employee each Sunday night…. he shares his thinking on a topic he considers important to the company.”
Hoffman and Yeh share several overarching rules, one of which is “Evolve Your Culture”:
“Ignoring your culture is not an option… Clearly defining the way an organization does things matters, because blitzscaling requires aggressive, focused action, and unclear, hazy cultures get in the way of actually implementing strategy.” Plus, “culture is actually a substitute for bureaucracy and rules. The stronger you make your culture, the less you’ll have to bind people’s behavior with rigid directives.”
Imagine if someone asked a random employee from your start-up the following questions:
What is your organization trying to do?
How are you trying to achieve those goals?
What acceptable risks are you incurring to achieve those goals more quickly?
What you have to trade off certain values, which ones take priority?
What kind of behavior do you hire, promote, or fire?”
“Would she be able to answer those questions? Culture is critical because it influences how people act in the absence of specific directives and rules, or when those rules reach their breaking point.”
So how do you create a good culture? As a founder or early employee, you transmit the culture organically in the family stage. But as the organization grows, you also need to be more intentional. “Drew Houston makes sure all Dropbox employees are aware that they need to help re-create the culture. ‘We tell people, “You might have just joined last week, but sooner or later, you’ll be an old school Dropboxer too. So remember the things you like about this place now, because it’ll be your responsibility to make sure those things stick around.’”
There are two key levers of deliberate cultural transmission:
Communications: “Airbnb, for example, employs a wide range of channels to maximize cultural transmission. The weekly e-mail cofounder Brian Chesky sends to all Airbnb employees is a powerful one. “You have to repeat things,” Brian told our class at Stanford. “Culture is about repeating, over and over again, the things that really matter for your company.” Airbnb reinforces those verbal messages with visual impact as well. Brian hired an artist from Pixar to create a storyboard of the entire experience of an Airbnb guest, from start to finish, emphasizing the customer-centered design thinking that is a hallmark of its culture.”
People management: Who you hire, promote, and fire is a huge component of culture. However, many growing organizations either outsource HR or don’t pay much attention to it. It’s important to value the HR and talent functions of the organization, and to evolve them as the organization grow.
There is so much more good advice in this book!
One of my favorite podcasts is Reboot, which showcases the heart and soul, the wins and losses, the ups and downs of startup leadership. On the show, Entrepreneurs, CEO’s, and Startup Leaders discuss with Jerry Colonna (executive coach at Reboot and former VC) the emotional and psychological challenges they face daily as leaders. In this episode, Jerry talks to Evgeny Shadchnev, Co-founder and CEO of Makers Academy. Ev wrestles with the question of whether it’s possible to scale an organization built on trust. My favorite moment in the podcast is when Jerry shares three questions that all leaders should ask:
“What am I not saying that needs to be said?”
“What am I saying that’s not being heard?”
“What’s being said that I’m not hearing?”
This advice reminds of me the two questions that Steve Jobs asked when he was leading Pixar: “He would have to figure out where his attention was needed really fast, so he would arrange sessions with all the different teams—the Cars team, the technology team, whatever—so there were a dozen or so people in each one. Then he would point to one person in each session and say:
Tell me what’s not working at Pixar.
…“That person might offer something like, ‘The design team isn’t open to new technology we’re building.’ Jobs would ask others if they agreed. He would then choose someone else and say:
Tell me what’s working at Pixar.
….Jobs would alternate between the two questions until he felt like he had a handle on what was going on.”