Success in a startup: The team

I believe that the most complicated part of building a company is to find the right team. Firstly the work environment needs to embrace strong cultural boundaries that employees will follow, while simultaneously giving enough freedom to each individual to feel the ownership of their work. The saying “Culture eats strategy for breakfast” greatly underlines the importance of a cultural setup in a work environment.

No matter how flat is the hierarchy in your company, someone has to say the final word. A boss, director or CEO will shape companies work and culture environment. Employees look up to their leaders to adjust their actions to fit the company’s social and working norms.

Let me give you an example: Image two companies, selling the same exact product, with the same amount of people and the same clientele.

  1. First company is doing great. Even more than great. Everyone is working hard, there is coherence among departments and individuals. Nearly no difference in job performance when the mangers or bosses are not present. Employees are encouraged, awarder, appreciated and every problem comes with a potential solutions not a problem description.
  2. Second company is doing ok. Employees leave at 5.00, are reluctant to take on new challenges. The default for moral norms in the company allows to complain and the overall company’s moral is a “good” at it’s best. Individuals are less willing to work when no one is watching.

I believe that this slight, yet powerful difference in the companies performance can be achieved with 3 cornerstones — Good morale standards, agile leadership and clear communication.

1. Moral standards

Every action from the coffee break talks, daily working routines to strategy meetings will be affected by the socially accepted standards company embraces. If it’s alright to come late for meetings, then coming late for works in not far fetched. Tough creating healthy moral standards is a delicate matter - like ironing a silk shirt with a hot iron — with a little too much pressure it could get ruined. Therefore it must a well thought through and foolproof strategy to create and maintain a set of moral standards.

Often it is an insignificant change that can makes a significant reform. There are couple of experiments done that tested how to make employees pay for the coffee, when nobody was watching. Long story short, the trick was to put an image of eye looking directly at you when you refill your daily dose of caffeine and people started to pay up.

You won’t fix/create the morale standards by setting up printed images around the office, but with small exercises you can slowly breed a new ways of thinking and adapting new habits. It’s a long and tedious process to change a way how we behave, so be sure to work on it from the companies day one!

-Another coffee related example:

Starbucks is not a very different company in their product offerings. As you know they serve coffee. One of the reasons behind the great success has been the investment in employee development. If employees in your company are satisfied, they will be more willing to spread a bit of that joy forward to the customers.

With this example in mind, keep the employee moral compass in balance and keep your finger on the pulse to see if everyone is synced with companies cultural norms.

2. Leadership

“Leadership is the capacity to translate vision into reality.” — Warren G. Bennis

My personal favorite leadership lessons comes from Elon Musk and a specific moment I recall as his greatest leadership achievements was in 2008 after the 3rd SpaceX flight failed. “Everyone can sail in a calm sea..” and Elon Musk showed how to steer through a spine-chilling storm. At the time there was more than 300 people working 80+ hour work weeks, putting out all they have to send a privately owned rocket in space, but it failed, again.

It’s difficult to grasp, how do you retain sanity and push the company to work even harder for the next (4th !!) try. Elon not only managed to get SpaceX back on the feet, but do it in a matter of weeks, which in space rocket industry is mind–boggling.

“We cannot become what we need to be by remaining what we are.” 
Max DePree

A quite different and also affective approach is done by Dior garment makers. Whenever a large order comes in, meaning that a large amount of clothing will need to be made, the garment makers will choose themselves the task they feel the most passionate about and in this way assuring the feeling of responsibility of doing the best job they possibly can. It’s another business and another approach, where agility is a must to drive a successful business.

Regardless of your leadership style, you must communicate the direction, via vision, goals and tasks in a comprehensible and persuasive manner to unite your team to go through fire and flood.

3. Communication

Companies activities must be communicated in a transparent and comprehensible manner as employees need a guiding compass to adjust their actions.

Let me tell you an example from “The Power of Habit” how a company transformed into a very successful venture with a strong focus on crystal clear communication.

Alcoa’s new CEO set a goal to create the safest company in the world. This new priority seemed outrages to most of the companies investors, moreover, Alcoa produces lightweight metal technology, and to make safety as the priority seemed like a nut job, but the thought behind it was very clever.

“I knew I had to transform Alcoa,” O’Neill told me. “But you can’t order people to change.”

The bottom line to the new companies strategy was that an injury had to be reported in less than 24h to the CEO of the company(currently Alcoa has around 60k people). In order to do that every person from top-down company’s hierarchy had to be as responsive as possible. One of the major elements to achieve this goal was clear and sharp communication among the all departments and hierarchy levels in the company.

The result was that in a year Alcoa hit a record high profit margin and during the presence of O’Neill as the CEO the annual income grew 5 times.

Sum up

In my eyes the foundation of great teams, must stand on three pillars: Cultural values, great leadership and clear communication. I believe that this advice will help you also if your life’s dream does not encounter an entrepreneurial path. Always value people first and the results will come unconditionally.