Culture Over Rules

Technology startups are often dominated by Caucasian males preaching the importance of culture. This irony should be lost on no one... in the boom of entrepreneurship and investing, the intangible concept of togetherness became an undeniable metric for success. As VCs have continued to emphasize the importance of employee happiness, it's been clear that we've undergone a fundamental shift away from the suit-and-tie offices which once dominated American professionalism.

The importance of company culture has no lack of advocates. Those in traditional work environments may associate tech culture with ball pits and ping pong tables, but the significance of company culture goes far beyond short-term relief and happiness. Companies such as Airbnb openly preach prioritizing culture, and in doing so these pioneers recognize core beliefs as a primary prerequisite for success.

In the context of the workplace, culture should be considered a counter-argument to strict rule enforcement. While both culture and rules strive to achieve the same effect, they are polar opposite execution philosophies. The perfect balance of yin and yang will differ from company to company, but this giant lizard personally favors leaning heavily towards the former.

Willingness Over Obligation

Employees are happier when they fit in, and it should not difficult to imagine why. The desire to fit in has evolutionary purposes dating back to the earliest human ancestors, and is a fundamental need rivaling the importance of food, water, and shelter.

In 1981 an experiment was conducted to gauge the relationship between mindset and perceived age. Older gentlemen who were otherwise removed from generational peers were gathered in a house to relive a time more familiar to them for 5 days. The result held nearly inexplicable shifts in the demeanor and health of each of the participants:

Perhaps most improbable, their sight improved. Independent judges said they looked younger. The experimental subjects, Langer told me, had “put their mind in an earlier time,” and their bodies went along for the ride.

Stress is well-known to have negative effects on health, so the notion of happiness achieving the opposite may not be so farfetched. As an employer it is necessary to recognize that happy workers are more productive. In perhaps the most cynical viewpoint of why company culture is important, the output of employees is increased to a quantifiable degree with zero added cost to the employer.

Less quantifiable (but arguably more important) is the reality that employees are more willing to contribute meaningful ideas when they feel as though their voices are being heard. This truth may have been an even more important factor for companies such as Google or Squarespace, which both depend on innovation. It's no coincidence that our definition of good company culture did not exist until disruptive technology became a business model.

Culture As A Recruitment Tool

Quality talent is a scarce commodity, and plenty of companies are undergoing cultural shifts to appeal to new recruits. Goldman Sachs has long struggled to attract high caliber developers who shy away from traditional offices. In response, the firm has recently shifted to lift its dress code policy for incoming development talent. This marks a significant milestone, as one of the world's most notoriously buttoned-up firms embraces a philosophical shift out of necessity.

In a similar effort, Zapier announced they would provide a stipend of $10,000 for incoming talent looking to leave San Francisco. The intent was to feed on the growing number of disgruntled technologists to step away from the bay area bubble. The actual effect was unforeseen:

Zapier saw a 30% increase in job applicants, and no new hires accepted the money.

The company immediately generated company awareness and positive perception without spending a single penny. Just as interesting is that many new applicants were not even from the Bay area- they had simply been attracted to Zapier's core values.

Just as culture is a reason to join a company, it is a significant factor in employee retention. It is no secret that the job market is currently stacked heavily in the favor of employers: as human life becomes an abundant resource, salaries trend downwards. Employees quickly lose allegiance to the faceless machines which sign their paychecks.

When the job market is dominated by these machines, companies with a strong culture becomes an invaluable factor in the quality of life of employees. Personal relationships are the world's cheapest self-sustaining resource... when people feel as though they have something to lose (an enjoyable job in a down market), they will continuously convince themselves of the importance of staying. As this importance is reiterated over time, people may even romanticize their current level of happiness beyond reality in the face of the unknown job market. Tribes is a common bible amongst culture-conscious entrepreneurs across all business verticals, from fitness to restaurants and beyond. Stumbling across a member of one of these cult-esque companies becomes immediately obvious as they often adopt coworkers as their immediate friend group, and sacrifice personal free time by their own accord. Outsiders often have difficulty relating to why anybody would do this, but these employees find their actions obvious. Their employers have successfully utilized their primal instincts to instill a subconscious fear of falling out of touch.

Guardrails For The Incompetent

Cultural norms are more likely to be followed than dictated laws. As human survival has always depended on group dynamics, a choice in favor of culture is a choice to leverage human nature.

A number of years ago I worked for a company which left dress code rules entirely vague. As this was not a traditional technology company, there was an understandable mix of what each department considered to be acceptable workplace attire, ranging the entirety of the spectrum from suits to jeans. This came crashing down on one fateful day where a developer had stumbled into an investor meeting with an unwashed t-shirt, shorts, and sandals. Within 24 hours, hundreds of employees received a company-wide email detailing a new dress code policy. The backlash was immediate: employees were vocally disgusted, and it became consensuses that this rule was not to be respected. The dress code had been abandoned within a month. The significance of this is simple:

Rules are less likely to be respected than cultural implications.

Laws exist to serve the benefit of a larger society or organization. Human beings constantly dissect rules on an individual basis to determine if following said rules holds any direct benefit to them; go ahead and see how well jaywalking laws hold up with law-abiding citizens when they are presented with a red light at empty crosswalk. Conversely the connotations of falling short in a tightly-knit unit needs no explanation.

Rules exist to herd people in a single direction. Implementing and enforcing rules has an unintended stigma: the people are either perceived to be untrustworthy, or the ruling power can not be bothered with individual needs and concerns. To employees who are aware of their own value the over-enforcement of rules creates an immediate disconnect, regardless of how competent they are. Why opt-out of the zero-cost enforcement which comes with culture in favor of adding the stress of doing something wrong?

There is of course the subconscious implications behind explicit reiteration of rules which should be painfully obvious. Vocalizing an organization's commitment against atrocities such as racism or sexism begs the question: why is this company hiring racist sex-offenders in the first place?

Putting Culture First

The benefits of strong company culture are tenfold. Increased productivity, attracting/retaining talent, encouraging innovation, and higher success in acting accordingly are just a few examples. This is not to say that rules don't have their place: the existence of explicit rules may promote swifter action to deal with obvious misconduct. There is a balance to be struck.

Creating and maintaining work culture is a process in itself which begins with hiring the right people. Doing this entails a philosophical shift in hiring process: how will you use your time with candidates to determine not only their qualifications, but who they are as a person? This is easier than it sounds; every other relationship in our lives begins with an assess another individual's moral compass, wants, and needs... hiring employees should not be any different. Including peers in cultural interviews is an excellent way to involve current employees in the process and identify things which may have been otherwise missed.

Over time it is clear to see how our definition of what constitutes a good company culture might change. The rise of coworking spaces and remote work-from-home companies may signal a shift to move 'work' closer to what we may one day refer to as 'life.'

Culture-first organizations differ from archaic rule-first monoliths similar in how democracies differ from dictatorships. Maintaining a set of core values to serve as the driving factor individuals is far less straightforward than rule enforcement, but the benefits are clear cut to those who are patient. You can't teach culture, but if implemented correctly you won't need to. Isn't that the point?