99 percent of all startups will bootstrap the first 12 to 24 months of their growth. Our startup was a part of that 99 percent…
Cash flow in the early startup days is always tight. Any leftover funds are usually funnelled into growth areas of the business. Which doesn’t leave much for wages. And as a result most startups can’t afford to hire rock star talent…
We knew from early on that to build a great business we had to bring aboard the best people. But talented people are often more attracted to big companies with big salary packages.
So the challenge wasn’t “How to get more money to pay staff”. Heck, in those days we could barely pay ourselves. No, the challenge was “How can we create something here, that they’ll never get over there?”
The answer didn’t come to us right away. But when it did, it hit us like Miley on a wrecking ball!
Here’s our story of how company culture came to be our greatest strategy for growth.
Finding Your Why
We had to take a big backward step to really look at our reason for doing what we do – our why. Why? Well, anyone who was going to become a part of our new culture had to be passionate, driven and share our vision for the future of Buzinga, and more importantly, the future of mobile applications.
If they didn’t share this belief, they would surely feel as if though they were fighting for someone else’s cause. And they would never feel as if they were part of the bigger vision.
We wanted them to see things the way we saw them, and be excited by what excited us.
A mission that drives you
Where some people were fuelled by ‘being the biggest’ or ‘making the most money’, my business partner (Graham) and I are driven by being the Leading Authority in our industry.
This became part of our mission statement and we would use it when recruiting. It also made appearances at our monthly company planning meetings, and during casual conversations with the team. In fact, later we would even use it when qualifying new customers. We figured that customers who liked our mission would have a much higher success rate with us. As opposed to someone looking for a cash-grab.
Did our why work?
The ‘why’ became the foundation of our company culture. It helped us attract the right people and kept us focused on what’s important; delivering a great product and being the leading authority in our industry, both here in Australia, and on an international level.
When you start a business you have to consider what’s important to you specifically. As a business owner you have a chance to make a real difference. Here’s a chance to jot down the fundamental issues you care about and the way you want your company to be a part the change that.
Building a community
What distinguishes one community from another is the values that we hold. In Community-A they’re passionate about the footy. In Community-B they care about saving the whales. By defining your values you’re telling people ‘this is what we stand for, are you into that?’
Building a business is not about finding people to fit into a role. It’s about building a community of likeminded people with similar values and a diversity of skills that complement the growth path of your company culture.
Traditions in your culture
Your values gives your community a character. When people feel comfortable around each other they begin to partake in social activities – “Let’s go grab lunch in the park/beer after work/dinner at my house on Saturday”, etc.
Sooner or later the activities are repeated over and over and eventually they become tradition. For example, we go to the local pizza-bar for a pizza and a beer every Friday at 2pm – paid for by the company of course.
We believe that people perform at their best when they’re happy – and there are plenty of scientific studies to support our belief. Needless to say we spent a lot of time looking into this.
By studying the work of Simon Sinek – teacher of Inspiration Leadership and author of global best seller, ‘Start With Why’ – we learnt that happiness is hormonal. And by fostering a culture that stimulates the right hormones you can design happiness. But first of all you have to understand the fundamentals of human biology.
There are four hormones that make you feel happy:
- Endorphin; masks physical pain, assists with endurance, released during exercise.
- Dopamine; ensures we strive to achieve, released when kicking goals, winning, getting stuff done – and it’s highly addictive!
- Serotonin; establishes leadership, pride and status. i.e. we want to feel proud in ourselves and equally want our boss, friends parents, etc. to be proud of us.
- Oxytocin; attracts us to people with shared values, physical contact, hugging, shaking hands.
Of course we didn’t just rock up to the office on Monday morning and tell everyone to be more happy – or hormonal! We had to be careful of how we tackled it to make sure we didn’t freak anyone out.
Exercise seemed like the biggest hurdle to tackle. However, it turned out to be the easiest. I’m a health-freak so talking about good foods and the benefits of exercise came easy and the team were surprisingly receptive. 83% of our team are now partaking in regular exercise (up from 10%).
By helping our staff set and achieve their personal goals we hoped to stimulate the dopamine hormone.
Everyone was given management responsibility of some degree. Two reasons for this; we needed to remove ourselves from the everyday ‘doing’ and focus on steering the ship; this would also give them a feeling of being a leader in their own right. Achieving at being a leader (which we made it easy to do) allowed them to feel proud of their work. Which would once again stimulate the dopamine hormone.
Lastly, building human bonds between us and our staff was done through simple acts like talking to them, listening to what they had to say and letting them know that we had their back. The idea was to make them feel safe.
A Remarkable Vision
Ok, so you have some shared values, human connection and the start of a company culture. Now it’s time to hammer home the vision.
Many entrepreneurs struggle to sell their vision to their staff out of fear that they will seem canned, or lame. And we were the exactly the same; nervous and unsure of which approach to take.
Selling your vision
We held a meeting with our only executive at the time to think of the most effective ways of bringing our vision across to the team. That was the birth of our monthly company planning meeting.
Monthly company planning meeting
In order for a vision to work it has to appear on a regular basis. And it has to be linked to real business goals, actionable tasks and achievements.
The monthly company planning meeting was a perfect medium for communicating our ideas and getting staff buy-in. It’s an opportunity for individual team members to speak openly about their feelings toward a topic or project at hand, then follow up with suggestions for improvement.
A business is more than just a place to go to make money so that you can pay your rent. It’s a vehicle to help those involved get from point A to point B. It was important for our team to know that. So we asked them individually to share their goals with us after the meeting.
It was an absolute hit. At the end of that week we took everyone out for drinks to a local bar –culture building... And a few drinks down the line I had the most eye opening conversation with a couple of guys from the design team that confirmed that it worked. They were into it.
There are many companies in Australia that offer a similar service to what we do. But I don’t believe that any of them build better product or offer the same level of service as us. And I’ll wholeheartedly contribute that to our company culture.
The results of what we’ve been able to measure as part of the experiment are:
- Our staff turnover rate (churn) dropped by 45%; from 50% to 5%
- Avg. sick day per staff member went from 6 days p/a to 2 days p/a
- Avg. overtime per staff member is 2 hours and 45 minutes per week (Note: we never ask for overtime)
- Project Deadlines Met (PDM) up by 65%
- Rework down by 25%
- Customer satisfaction up by 150%; this was important to us.
Things that we didn’t or couldn’t measure:
- Regular mentions of appreciation from staff
- Less complaints
- More great ideas
- Automation; things get done without the need for our input
- Phenomenal output of finished work
- An overall happier vibe
The most important factor that we got out this was the people. In the early days we couldn’t offer everyone a 100k+ salary, even if they were worth it. But the thing is; most people will rather take a cut in pay than work somewhere they hate.
It was never in our intention to exploit that. In fact we give regular pay rises to our staff members to encourage great performance. But the truth is that by building a company culture that people wanted to be a part of we improved productivity drastically, as seen above; and were able to attract talent that otherwise would have been out of our league.
That idea paid itself off 100 times over. It just goes to show – “You can make money without doing evil.” – Google Company.
The 6 Human Needs
I’m a big advocate for NLP (Neuro-Linguistic Programming) to help establish positive habits. From my studies into NLP I learnt about the 6 Human Needs. In essence, human behaviour is largely governed by our need to feel some level of:
We knew that if we could cover off these human needs we would surely create an incredible culture. And in order to acknowledge and nurture each of these needs we had to implement new activities and ideals:
Certainty – everyone wants to feel a level of certainty. If you knew that the world was going to end tomorrow you wouldn’t be playing at you’re A-game today. The certainty we could offer our staff was that if they kept up the good work they would always have a place with us.
Uncertainty – though we yearn for that feeling of certainty there is always that little voice in the back of our mind aching for some variety. We’re a startup so we figured we already had this covered!
Significance – we all want to feel like we’re significant to someone. And we wanted our staff to know that they’re important to us. One-on-one lunches with individual team members became a tradition. We connect with them to see how they were tracking and to learn about gaps they can see in our processes, etc. We would also talk about their goals. This made them feel like their goals were important and let them know that we cared about them.
Connection – you always want to know that you’re connecting with the people around you. If you don’t connect then you’ll quickly realise that you don’t belong – and leave. HR is an enormous cost to businesses of all sizes. Because of the time spent picking the right people who believed in our values and our mission, we don’t really need to deal with that issue anymore other than regular activities, lunches, and events outside of work.
Growth – in our one-on-one lunches and company planning meetings we would always relate our company goals to the goals of each individual staff member. That way they felt they were growing with the company. We would also help them and challenge them to learn new skills.
Contribution – is the feeling of knowing that you being there made the world a better place. We didn’t have a lot of money to throw around at the time but one of our values is to be resourceful. So that became: recycle, avoid unnecessary waste and help those who need it.