One of the challenges to a growing company’s ability to scale is trying to keep culture intact through those pivotal growth moments.
Many years ago when I was one of the key members in opening an amusement park, I was brought on board when there were only about 30 employees. As we planned, built, and started to see the project develop, we had a great camaraderie and really enjoyed the teamwork and collaboration.
We tried keeping that same spirit when our departments starting hiring managers and supervisors, and we succeeded to a good degree. And that even carried through to our hiring of staff getting ready for our grand opening.
But when we opened to the public the dynamics changed. Silos went up. We went from collaboration to survival. And for the next year, we struggled to respond to that quick growth and our culture was just a shell of its earlier self.
I’ve seen burgeoning retail, service and restaurant concepts struggle with going from a few locations to over ten units. They start to realize that they need people to slot into new functions – such as purchasing, legal, payroll and facilities – that were either done in-house with the talent they had or contracted out. And at some point these companies get to where they become so top-heavy that the cultural focus is on the company headquarters and less on the units and those closest to the customer.
When a company grows there are usually 4 stages they go through:
Start-up Spirit – This is the initial few people who share the vision. Many of them have a financial stake in the company, but if not, they share the vision based on the business plan or the culture and/or charisma of an individual or individuals at the ground floor.
Pioneer Phase – This is the exciting time where customers, sales and locations are growing and getting settled. The vision becomes a reality and further drives the excitement and passion of the culture.
Systems and Brand Period – This is the watershed moment for many organizations. Now that they’re growing, scale becomes vital to both operations and brand. Systems start to get ratcheted down but can become restrictive and many times be counter to initial culture. This may further hamper the ability to execute the brand at the customer level.
Top-Level Growth – This is the stage where the head can get bigger than the body. As the company scales, risk management, legal and financial implications become heavier, as well as the responsibility of maintaining the office(s) that run the company now. A company that’s not careful can grow their offices and top-level structure to the point that decisions are made furthest from the customers. And many times that leads to decisions that benefit those as the top, and not those who are customer-facing.
When scaling a company, keep in mind that every dollar spent, especially in people resources, that doesn’t generate a direct return in revenue should be strongly scrutinized to see if it is a priority aligned with culture and customer. If not then that expenditure should be reconsidered.
If resources for success at the front line are sucked up because the top level is feeding itself, then your culture is in jeopardy and change needs to occur immediately.
It’s difficult to maintain the “start-up” and “pioneer” spirit through each stage of growth. And in each stage of growth, finding the right people who possess that spirit doesn’t always occur either.
A company’s best bet is to infuse micro-cultures with start-up or pioneer spirit at the most local level. Regions and areas that can infuse this culture closer to their front-line can do it better than a large, growing corporate office. Even better, giving autonomy through hiring and training and also systems/processes that align with culture helps to preserve this attitude better than regional teams. That's because autonomy gives people an opportunity to feel part of something big and exciting, and not a growing machine.
Keeping culture intact requires validating every day that everything from top to bottom is governed by your culture. There is no other way. It requires a conscious discipline of thought, focus and repetition to ensure what you’re building continues to be what you originally started.
Chief Culture Officers are nice, but if everyone is empowered with the vision, is valued and given voice in the organization, you will have a more lasting cultural impact through hundreds of CCOs versus relying on one person to oversee an growing entity that may get too big for them to influence.
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Paul LaRue is the creator of The UPwards Leader and Instigator for Lead Change Group. His background in senior leadership, strategic planning, culture change, and people and organizational development gives him unique insight into the workings of successful organizations. Paul has given speeches and training sessions for many public and private entities and stresses the virtue of a culture that centers around core values and character in leadership.