For the past few weeks, I’ve been listening to startup founders about how they scaled their companies while preserving their core values at the same time. As such, I will be summarizing some of the recurring elements that stood out to me.
One thing that really surprised me is that really large companies are not run as efficiently as you think. A lot of times, bureaucracy gets piled up that causes employees to lose the initial spark they had when they joined the company. Hence, this results in big companies having “payroll employees” where their only reason of remaining in the company is to receive their next paycheck. These employees lose their motivation to bring in their A game while working and will only stifle further growth for the company. If something is not done to reverse the effects, soon the enthusiastic employees will too lose all hope and in turn leave or transform into one of the “payroll employees”.
One of the best way a company could prevent this is to establish an official channel where employees are able to contribute to the company’s growth directly. From what I’ve noticed, the really successful companies such as Google, Facebook, Airbnb and etc really encourage and welcome their employees to contribute whatever they can to the company’s improvement. These companies took the effort to deliberately set up channels and environments where their employees feel safe to express their opinions on how the company should move forward.
Once you’ve passed product market fit, you’re no longer building a product, you’re building a company. Essentially, you’re building your hive, your people and your culture. The highly successful companies understand that their biggest asset right now is their people and they do everything that they can to leverage on their ambitions and eagerness to help shape the company. For example, Google has long been known for implementing the 20% time project where employees can dedicate a portion of their work time in doing anything they like. At that time, this kind of corporate culture is unheard of and was viewed negatively by other companies. As it turns out, the 20% project actually contributed a lot to Google’s growth which ultimately shaped them to be the company they are known today. Often times, these 20% projects are simple projects that help improve the way things are run around Google. A lot of these 20% project actually went on to become official Google products that brought it different forms of revenue to Google.
Recently, I had the privilege to listen to Marissa Myer, the CEO of Yahoo speak. She mentioned that when she took over as Yahoo’s CEO, a lot of the Yahoo’s employees were very disconnected with the higher level executives. The only time employees had an opportunity to speak their mind was during the quarterly all company meetings that happens 4 times a year. As such, Marissa actually spent a lot of time in Yahoo’s cafeteria to talk to employees to understand their concerns at the lower level. In addition to that, she also launched the “CEO challenge” at Yahoo where she challenged every employee in Yahoo to come up with anything that can bring in revenue for Yahoo through channels that have never been thought of. From the challenge, she received hundreds of application where employees would work extra hours just to get their opinions and ideas across to the CEO. At the end of the program, Marissa realized that a lot of employees actually want to contribute beyond their work to make the company better but all they are lacking is the proper channel. As Marissa simply puts it: “If your employees want to go above and beyond to improve the company, why not let them?”. Even better yet, why not help them?
CEOs are like football players
The second thing I’ve picked up from Marissa is that CEOs in large scale companies should act as the bulldozer during a roadblock. No longer are you the person building the product, making changes to your website or directly going out to find customers. You now lead a team of hundreds or thousands of people and your job as a CEO is basically to point the company towards a direction and do your best to get rid of all the obstacles that may hinder your employees from executing it. You can say that the CEO is somehow like a football player that tackles anyone that gets in the way so that your employees can reach the touch down line.
Another recurring theme for really successful companies is the preservation of company culture while scaling the workforce. Brian Chesky, the founder and CEO of Airbnb mentioned that he personally interviewed the first few hundred employees himself to preserve the culture he wanted at Airbnb. Today, anyone that interviewed for Airbnb is required to go through two culture interviews to determine if they fit the culture of Airbnb. Brian also dispute the notion that a company’s culture should be developed organic. He mentions that culture is separated into two — strong culture and weak culture and if you do not intervene to shape your company’s culture from the source, your company will eventually develop a weak culture that you might not like. Liking the work culture goes a long way as it helps everyone in the company communicate better and not hate each other (which is actually pretty important while growing a company).
Grow your company’s culture by setting the core values during hiring
As a summary, the lessons I’ve gathered from large scale companies are as follow:
Provide a channel for your super loyal and enthusiastic employees to go above and beyond. It means a lot to them.
The purpose of the CEO at this stage is to clear all roadblocks so that the company can sprint forward with its full potential.
Company culture is not developed organically. Set a few boundaries and core values and ingrain them right from the hiring process.