When to hit the pause button on culture

“What’s your favorite thing about working at Company X?” the starry-eyed candidate asks.

The chambray-shirted manager leans back, a bright smile spreading wide.

“The culture,” crooning confidently.

This pattern plays out, month after month, as more and more headcount is added. But one day the manager finds their smile feeling a little more forced and their answer feeling a little less authentic.

***

With scale, companies often outgrow the rituals that once supported their founding.

And as it turns out, this isn’t as unpredictable as it might seem. There’s identifiable inflection points where companies need to hit pause, and reassess whether their culture still fits.

A culture may need to hit pause when a company has changes in:

1) Executive Leadership

2) Core Customers

3) Team Headcount — particularly when any team surpasses 30 people

Defining Culture Shifts with New Executive Leadership

Founder’s stories are at the heart of many a great company culture. The values that led the founder to start their business are often a guiding light, particularly before product/market fit is established.

Cultures have a funny way of taking on the personality of their leaders. If the executive team is really into fitness, the company is more likely to have a great wellness program. If the executive team is very reserved, it’s unlikely that there’s a cowbell in the bullpen.

But as new executive leaders come in, they bring new personality to the culture. New executives who can’t integrate into the culture are often rejected like a bad organ transplant.

The first executive on a leadership team with kids might not be into late night brainstorm sessions. An executive hired to bring in a performance mindset might come into a conflict with a culture built to prioritize cautious planning.

It’s a two way street; both the culture and the executive will need to adapt. But the strongest company cultures use the hiring of new executives as opportunities to expand culture and make it more inclusive.

When considering how your culture should evolve with this new leadership, it’s worth asking the following questions around the new executive’s role:

• Spokesperson Role: Will the new executive serve as a spokesperson to media, employee relations or product innovation?
• Values Role: Will the the new executive help the company become more competitive, frugal, sustainable or customer centric?
• Representative Role: Can the new executive help the rituals of the company culture evolve to fit a more diverse employee base through their demographic or psychographic identity?

Defining Culture Shifts with New Core Customers

As a business scales, it’s core customers usually become less niche. This can water down the authenticity that was originally built into a company’s culture.

Instagram, for example, originally catered to helping friends meet up at bars. Today, Instagram features photos of everything and has over a million users. The culture required to build that kind of product is different than what’s required to build a product targeting bar patrons.

When considering how your culture should evolve with a new customer base, it’s worth considering the following:

• How will new customers engage with the business differently? Will you meet customers in new channels, provide new experiences or offer new pricing models that could conflict with a company’s original culture?
• What do new customers value? Are your new customers less eco-conscious, tech-savvy or luxury-oriented? How will this challenge the values built into the company culture?
• Do your new customers represent a different demographic/psychographic than current execs? Has your customer base has expanded from urban to suburban, single people to parents or millennial to gen-xers? If yes, have the differences between employee base and your customer base widened?

Defining Culture Shifts When Teams Pass 30 People

There’s a reason most grade school classes don’t exceed 30. Larger groups don’t fit well in most classrooms, much less conference rooms.

When a company passes 30 employees, the daily stand-up becomes impractical. When a marketing team passes 30 people, there’s a mix of both specialists and generalists on the team, and it’s unlikely that everyone knows the nitty gritty on what everyone else is doing. When a product team passes 30, the footwear team and activewear team might have very different key performance indicators based on product lifecycle.

At 30 people, that “we’re in it together” family feeling begins to wane.

The other dynamic here is that people begin to feel loyalty to more and more tribes as a company grows. Are you first a member of your company, department, specialty, product team, or seniority level?

Some questions worth considering are:

How have people’s roles evolved? Do people understand how their role impacts the ecosystem that the culture is built around?

How has specialization changed the team? How can activities around culture help break down silos?

What are the demographics represented on different teams as they’ve scaled? Are certain demographics underrepresented in certain speciality areas/seniority levels? Is the culture doing anything to reinforce a lack of diversity?

A company’s culture is a mosaic of rituals, events and vocabulary that brings a team together. It’s the buzz words repeated in meetings. The way a team brainstorms, socializes ideas and celebrates success. The work anniversaries and birthdays. The team bonding sessions and chat groups. The water cooler conversations. The personal details people share. The hours people keep. The way people recharge. The company swag people feel proud to wear.

Culture needs to serve its constituents. This isn’t the same at a 10 person start-up as it is at a 10,000 person multinational corporation.

When we as leaders recognize the changes in a business that require a reset, we can actively raise the right questions and drive evolution so that culture remains a positive and uniting force.

A culture that scales effectively should connect to leaders’ values. A culture that scales effectively should consciously relate to customer values. A culture that scales effectively should should unite teams and serve as a connective tissue between teams as people specialize and become more dispersed.

When we use growth inflections as moments to reset, culture is about “our culture,” not “the culture.”