Key Challenges When Developing Company Culture (Survey Insights)

The importance and challenges in developing culture within companies.

As part of my process in better understanding the key needs of founders, leaders and managers, I recently launched a survey focused on learning more about the importance of culture development for companies. The survey was only 10 questions long and I plan to dive deeper into key challenges associated with developing culture within a company by interviewing them in more detail. 

I am extremely grateful to the 40+ companies that have filled out the survey to date. If you're interested in adding to the data, this is the link to the survey. I will continue to update this post if / when the data continues to evolve. I would love to break the data down further by region, industry and company stage so feel free to share it to folks! 

Results of the survey below and added my thoughts based on my personal work experience over the past 15 years with corporates, startups and as an investor in startups.

Survey Context

  • Out of the 40+ people who took the survey, over 70% are either a Founder (or ex-Founder) or in a C-level position.
  • The companies that took part in the survey are predominantly based between 3 to 200 people and have raised some money for their startup.
  • The industries for the 40+ companies range from professional services, advertising, pet care, hardware, consumer products and software
  • The participants are based predominantly in the US so the data will be skewed towards a US workplace environment 
  • Note that the 40+ people who took the survey will most likely index culture development as a higher priority within their company since this is a self-selected survey (aka they care about the subject and thus filled in the survey).
  • The breakdown of the companies based on their company stage are as follows

Culture development is really important

If you’ve ever worked for a company, worked with colleagues and hired people, this is like a universal truth. A bad manager, a political environment or toxic culture can make work a miserable experience which then impacts other parts of your life. A great company culture will enable you to hire the best talent, improve productivity (happy people are more productive!) and make you healthier.

Pretty much everyone who took the survey recognized that culture development is really important with a median score of 9 (average score of 8.4 and a range between 1 to 10). It would be great to dive deeper into how their previous experiences impacted their score. Looking at the profiles of the participants of the survey, most have either worked at a bigger company previously or have been a leader / manager which explains the need to drive a stronger culture to engage and motivate their team. 

For the participants who provided a score towards the lower end, they’re in the process of starting a new company and found that since the team is small, there is no immediate need to develop culture within the company yet. The main reasons why folks think culture is important to them and their company. Select quotes in verbatim and grouping them into specific insights as follows:

Culture development makes everything easier in the long term

“Because building a great culture is pivotal to any company that wants to succeed. Building a company is insanely hard.  You will need a strong culture to make it through the toughest of times.”

“Having motivated team members who can communicate clearly and collaborate effectively is a necessary condition for success. It's easy to let it slip as the team grows a little bit, so we actively prioritize it by having team-wide culture OKRs and regular culture-building activities.”

I believe the culture is everything. A terrible and toxic culture will very quickly lead to failure once you're 10+ people, and it helps yourself as well as your employees and managers make better decisions when in conflict.

Founders seeing culture as the competitive advantage

“I've seen from prior startup and big co experiences that culture setting quite literally starts at day one. For startups, I strongly believe it starts with the way the founders interact with one another. I've been in a startup that failed due to culture issues, and a big takeaway from that was not to make the mistake of punting active culture development till an arbitrary milestone e.g. "First hire".

“We're looking to build an impact driven and intellectual company as the initial interest in starting Increment came out of wanting to research how technological changes are impacting socioeconomic mobility and polarization. We want to hire people and build a culture around that mindset”

“I believe the culture of our founder community will be our primary moat in the beginning stages of the company. Also, I'd like to finally mold a company that matches my vision”

“At this stage in the venture, it is critical everyone is committed to the same set of principles. We are early stage so our room for error is close to 0. For us, culture drives how we approach a problem. We could either do it the "right" slow way, or the quick hacky way. More times than not, the latter approach is needed and actually, sufficient.”

High importance but need to grow the company first

“We have so few people (3 FT) and so few resources, that we aren't able to invest in culture as much as I would like to further down the line. I am extremely diligent about the hires that I make, and feel like we have a good/positive/creative culture since we are so small and things are still special. Right now the most important thing for us is focusing on the work, so we don't do much in terms of culture or team building.” Founder of a 3 to 10 person startup

“It's growing more important by the day but until now we were sort of in survival mode and so the focus was more on making sure we could reach certain milestones. Today, I feel we have the "luxury" to focus more on culture and the way people feel.” Founder of a 20 person series A startup

“Building culture is really important at the stage that we're at since we're expanding our team and instituting more processes. It was not as much of a focus our first few years.” Founder of a 20 person seed stage startup

Established companies that are working well

“Feel it's been a more acute issue in the past and we've hit a nice balance in most (not all) areas. So it's not as urgent a priority as it has been or may be in the future, but is still an important thing to keep an eye on. Switch to remote work and economic uncertainty play into the importance of culture in different ways too.”

“At this stage, there isn't a lot of diversion among the team and it feels very much as an elite unit spirit where everyone cares about the company's mission so I don't feel a need to work on culture development”

Culture development starts from Day 1 

The response to this question was slightly surprising to me. My initial hypothesis was that most startups have not defined their culture elements (vision, mission, purpose, values etc) until much later stages of the company because it wouldn’t be a high priority for them until they’ve figured out their product, customers and finances.

It’ll be interesting to dive deeper into how unique these culture elements are to the company and how have they evolved this over time. Diving into the comments further, it also seems like the timing is based on where the company is at and other competing priorities but in general most Founders have a strong sense on what is important to them and why even if it’s not written down formally until they’re started hiring more people. 

Culture is hard to implement

Implementing culture is really difficult! It does take time to do it properly and there are no shortcuts. Note that a company culture will continue to develop even without your involvement for good or for bad so by influencing it the right way, you are able to steer it to the direction that you believe in. Living the culture that you’ve established is the most challenging part and every person that you bring to the team , it is important not only to hire properly but also to onboard them to the company culture early on to establish the right expectations. 

It is also important to make sure that bringing the culture to life is relevant to the behaviors that you want to reinforce and be consistent. For example, how Amazon runs their meetings may not be the best way to manage your meetings. It’s also important to not weaponize the values that you’ve created to the extreme as illustrated in the example with Away in trying to create transparency. Basic decency, empathy and company is important when dealing with people!

No single approach to developing culture

The participants had different ways of creating that culture and there are no consistent approaches or resources to tap into when thinking about culture development. Majority of it was based on  their previous experience in building teams, companies and thinking through what they liked / disliked about the teams that they were part of. Many participants also brought up the importance of engaging with the team and to have input from everyone. A couple of folks also noted that this is an ever evolving process but there was no structured approach to re-evaluating and refining the culture on a regular basis. Some companies hired external consultants to help and some kept it in house due to budget constraints.

Specific resources that participants have pointed out to help them develop the initial culture elements (mission, vision, purpose, values etc) included:

Questions that the companies have asked themselves as part of this process.

  • What do we want our brand and culture to be -- and what underlying values support this vision?
  • What are our personal values in the world?
  • What do we wish the world had more of? 
  • What do we feel it takes to create a supportive environment? 
  • How do we promote diversity - where everyone feels heard, seen, and loved as we grow down the line? 
  • How open and vulnerable are we as a team?
  • How do we engage in conflict?
  • How do we treat our customers and partners? 

I’ll be sharing some thoughts on how other companies implement their unique culture and bring those behaviors to life in upcoming posts. It’s also interesting to see no one really differentiated between the foundational values that they’ve established and the aspirational values that they want to achieve as a company. I’ll attempt to break this down further by industry, geography, and size of company where possible. Feel free to subscribe here if you’re interested in learning more. How have you brought your company culture to life?