Building a company’s culture – Lessons from “What do you is who you are”

I recently just read Ben Horowitz’s 2nd book: What you do is who you are: How to create your business culture.

This post is written as my study notes to understand and apply what’s suggested in this book. So these notes shouldn’t be taken as a literal summary of Ben’s book, but my interpretations of his, as I learn.

Now, let’s get started.

It’s more effective to make your culture explicit

Culture is a set of shared values. Shared by all of the staff in a company.

As the leader, if you don’t make them explicit, your employees wouldn’t know them all.

And more insidiously, each will understand the company’s culture in a different way. And then, they’d act accordingly.

That’s a mess.

In his intro, Ben said:

It’s (Culture’s) the set of assumptions your employees use to resolve the problems they face every day. It’s how they behave when no one is looking. If you don’t methodically set your culture, then two-thirds of it will end up being accidental, and the rest will be a mistake.

And we make things explicit by writing them down so everyone can see and understand them clearly.

Is culture a set of rules? Is it the company’s policies?

Culture is not a set of rules, but it’s manifested in a set of rules and policies.

A company’s culture vis-a-vis its rules and policies is analogous to a country’s culture relative to its law.

Culture is the guiding principles based on which a company’s rules and policies are made.

And as guiding principles, they’re extremely helpful when new situations emerge that haven’t been adequately addressed by any existing rules.

Who “sets” a company’s culture?

A culture can not be “set”, because it’s not something created through thinking.

In practice, a company’s leaders, including senior executives and board of directors will decide on a company’s values.

But, and a big but, those values will end up in a dead piece of paper if they’re not lived and enforced by most of the company’s employees.

In fact, it can be quite common place that what senior executives say about the company is one thing, but its culture, what’s actually happening day to day, shows a completely different picture.

As eloquently said by Ben in his book.

Who you are is not the values you list on the wall. It’s not what you say at an all-hands. It’s not your marketing campaign. It’s not even what you believe.

It’s what you do. What you do is who you are.

As such, a culture is defined by the majority of a company’s employees, heavily influenced by the pro-activeness or passivity of its leadership in defining the culture.

Will a company’s culture change?

Culture, once construed as a living thing, will definitely change. But the pace of change of a culture will be much slower than strategies or tactics.

Tactics will change most often and can change quite dramatically, because they’re related to the day-to-day operations.

Strategies will change less often and with lesser degrees than tactics, because they deal with longer-term horizons.

And a culture once mature will change the least often. Because a culture, is already, in some sense, a saturation point of a company’s “way of work” and aspirations.

But it will have to change when there are major changes in markets, goals and visions of a company.

It will change to stabilize the new sum of: new markets + new goals + new visions.

Lessons for building the desired culture

In the book, Ben suggested quite a couple things to do to build one’s desired culture.

Below are some of those points that draw the most of my attention:

  • Incorporate outside leadership: To pick up something new we don’t already have in house, we need help.
  • Walk the talk: Everyone learns through imitation, from children to adults. Talking without walking won’t build a culture, and whereby leaving it to be formed haphazardly.
  • Make ethics explicit: this is important, because it helps build a long-lasting foundation for any company.

Where culture can’t help

A great culture does not guarantee a successful business, unfortunately. Although it will highly increase the odds of it.

A suitable culture makes the company a better to place to work, which helps with recruiting & keeping talents. It also keep everyone aligned on priorities and the way things get done in an organization.

But alone, it can’t help a startup succeed or guarantee the longevity of an existing company.

In the words of the author:

That’s the nature of culture – it helps you do what you are doing better, but it can’t fix your strategy or thwart a dominant competitor.

That is, a company with a “great” working environment and culture can’t succeed without a great product/market fit, a good go-to-market strategy and so on.

On the other hand, a company with a not so good work environment can still succeed. But if it continues to keep that not-so-good work culture, it will greatly reduce its own effectiveness.

And that may eventually lead to its demise.

Helpful cultural values for your company

So far, we’ve understood that a company’s culture will include both elements that are specific to that company (due to the nature of its product, market, etc.) and elements that are “universally” good for most companies.

Ben suggests the following virtues that would be helpful to incorporate into all companies’ culture:

To be continued