One of the most important attributes of a startup is the shared sense of purpose. The entire company is working toward a common goal: building the right product or service and getting it out the door and into the hands of the right buyers. While there might be disagreement about the right product, right message or right buyer, there is usually little to no confusion about the basic goals.
Because of this shared understanding, employees usually can correlate how the work they are doing contributes to the common goal and understand overall progress toward that goal. There is little to no ambiguity.
This is one of the big reasons that startups are so powerful. As companies grow, however, they often lose their sense of a shared goal and, in turn, lose the power of their former selves. What makes this possible at startups and why does it typically fade with time? I believe that at least part of the answers lays transparency.
At startups, information is usually shared freely. Leaders stand up at weekly or biweekly meetings to talk about what’s happening. Emails likely go out every day or so talking about new customer wins, new employees and their roles, challenges, issues, etc.
In addition, and I believe most importantly, there’s the informal sharing that comes from working closely together day in and day out. I’ve seen startups do quite well without ever consciously thinking about how they will keep employees informed. While I don’t think this is a good strategy, I do believe that it points to the transparency and fluidity at many startups. Sharing “just happens” and people “just know.”
Marketing might have one or two people. The same with Business Development and Finance. Everyone sits together. They eat together. They travel together. In an open office, the finance person hears the engineers talking through issues. Product management works closely with marketing to rev messaging because marketing and product likely sit side-by-side. When the product blows up at company A, sales, product and engineering work hand-in-hand to solve the issue and marketing is right there beside them. And, everyone can hear what’s working for inside sales. Information sharing is inherent to this way of working and, I believe, core to success.
As a company grows from startup to public company, from 30 people to 300 or even 3,000, roles become more narrowly defined, the company breaks into functional groups that are clumped together in the office far away from other groups. Casual conversations become more rare. Indirect sharing of information can become non-existent. The result is that the larger group often loses track of the larger goal.
Then there’s the politics that usually come with working for a big company. Since information is power, there is a tendency for some to hoard information. Some do this out of a mistaken sense that employees can’t handle truth or ambiguity, or that they simply don’t need to know. Others do it to build their own internal power. [BTW, don’t hire those hoarders and if you have one, think seriously about replacing them. They are toxic to all organizations].
But I think the most common cause is inertia or a lack of recognition of a problem. Many companies don’t realize that they have a big problem because the problem crept up on them. It is an outgrowth of the company’s success. Leaders just keep on doing what they always did without realizing that what worked for a small company isn’t going to work at the enterprise-level. They didn’t realize that they had a process for sharing information because the process was often, if not always, informal, unwritten and unspoken.
The end result for an organization that doesn’t communicate is demoralized or uninformed employees who don’t know why their work matters.
[I will add a caveat that some things cannot be shared whether you’re a startup or a public company: an upcoming acquisition, some personnel issues, etc. That’s not what I’m talking about. I’m talking about the core goals and mission of the company and relating them to the work we do every day.]
I saw the rise of disgruntled employees at Riverbed and I’ve seen it at other companies as well. As we grew, team members would work on bits and pieces of projects without having an overall understanding of the project while managers of those projects might not know how their work fit into the overall work of the marketing department. And, it went even further. There were directors who did not understand how their work contributed to the overall business goals of the company.
As an overall organization, the company lacked the basic tools that one would expect at a company with over 2,500 employees. There was no working intranet and no company blog. So, to counter the lack of knowing, I made a conscious decision to start sharing information. To be more transparent. To meet with my with direct reports regularly to share with them what was happening in the larger business and relate our goals and priorities to where the company was headed. These meetings also gave them the opportunity to hear what the rest of the group was working on, how their work tied together and what each of them could do to make the larger team successful.
Then came the hard part. Sharing that information across the broader team. Getting the directors to understand that everyone, and I mean everyone, needed to come to our at-least-quarterly meetings where we talked about company direction and tied everything together. We had to counteract the frustration that often comes from incomplete knowledge.
At my first group-wide meeting, only half of the employees were there. A few were cynical and felt that the didn’t need to be there. Others were told not to come by their managers because it was “a waste of time” for 70 people to attend this meeting. Better to have the managers attend and then they could send a summary email.
We rescheduled so that everyone could attend, even if it meant that we were “losing” 140 hours of productivity for a one and a half to two hour meeting.
Over time, I saw a significant shift in perception as many co-workers embraced the larger context and found new purpose.
Why? Because they knew that their work mattered. They were not just cogs on a meaningless wheel. They knew that the organization itself had a purpose and how their work fit into that purpose. They were treated with respect. They were empowered.
And when they were asked to do the impossible, they understood how the impossible was critical to the organization.