The original concept of company campus perks was aligned with productivity. Free lunches allow employees to quickly grab food without leaving their work environment for extended periods of time. A free gymnasium encourages workers to come to the work campus earlier in the day or stay longer in the evening. Now that hard working employees are on campus for significant amounts of time, giving them free snacks and some entertainment to stimulate thinking is the right thing to do. These are often touted as the tactical benefits of working at the most successful companies of the last fifteen years.
However, company parties, ping pong tables, and free food and drinks do not constitute culture makers. These successful companies got many other foundational concepts right and that is truly what led to their ability to dominate their markets. Nowadays, many companies replicate these simple ideas without many of the other foundational concepts and predictably their growth trajectory is not as grand.
The above-mentioned tactical concepts help players on a team to get to know each others’ families and hobbies, they will develop friendships at work, and may even rate the company culture highly. It doesn’t necessarily drive a sustainable growth culture.
Objectively speaking, the purpose of a company culture is to find an optimal equilibrium between:
1) high employee satisfaction to retain top players, improve performance of mid-tier players, and allow bottom players to churn
2) continuously improve employee productivity and maturity to create the best possible products and services for customers, while generating a high return for investors [which may include employees]
I have heard the word Leadership floating around for decades, while experiencing life and education in three continents, keenly following world and business events, and exploring over two dozen companies. I have always taken it for granted that companies took this aspect seriously. But the well-publicized cultural challenges at larger fast-growth companies such as Uber and WeWork, along with my personal observations at small- and mid-sized companies forced a reassessment.
This brings us to the first and most foundational component of my growth framework – the company’s leadership approach. Senior executives at fast-growth companies will be well-served by a deep self-assessment of their own experience and capabilities and by borrowing a few lessons from companies that have successfully operated for decades.
Leadership Approach is the set of structural elements that top three or four senior executives of a company must set in place to create a transparent, objective, disciplined, and efficient organizational environment to achieve a fair balance between satisfaction of high-performers and a culture focused on continuous improvement in productivity and maturity. No amount of employee perks will be a substitute for the six core components below. We will discuss each one in more detail in the six chapters in this section.
Leadership Approach: Six Core Concepts
- Senior executive roles must be occupied by Leaders, a trait that is not evident in every human being.
- Core Values should be defined and used as day-to-day behavior guardrails.
- Senior executives must develop an Efficient Organizational Structure with clear, measurable accountabilities for every single employee.
- Effective Performance Management is absolutely critical to hire and retain a talented, winning team.
- At any scale, an organization has the responsibility to live by modern-day version of “Equal Pay, for Equal Work” through a fair, competitive, and transparent Compensation Management Approach.
- CEO must leverage a Leadership Toolkit to run the company efficiently, objectively, and transparently.