Core Culture

Culture interview with CEO of Pear Analytics

by Sheila Margolis on September 16, 2011

I conducted an interview with Ryan Kelly, founder and CEO of Pear Analytics, a web startup in San Antonio, Texas. They build search engine optimization tools and software to help make SEO accessible to everyone. This interview focused on the culture of Pear Analytics—its purpose and core values.

SM. What is the purpose of your company? Why is the work you do important?

Mr. Kelly. The purpose of Pear Analytics is to help organizations compete online. We help companies do a better job of being more visible online. Our work is important because Internet marketing is not as expensive as other forms of marketing. It’s cost effective and trackable; therefore, any size business can do it and benefit from it. Companies that don’t understand online marketing will be left behind and will miss opportunities because many of their competitors are doing it better. Additionally, companies who don’t understand Internet marketing often waste a lot of money because they don’t spend their money wisely. Often, a company can get better results with less money. This is a rewarding business because this work can generate quantifiable improvements.

SM. What are the ideals that drove the founding of your company?

Mr. Kelly.  We want to be transparent and honest in what we’re doing. A lot of companies in this business are not trustworthy. SEO has a bad connotation; there are many scammers in this business because most consumers don’t understand it. Customers often write checks without knowing what they’re getting. At Pear Analytics, we are transparent: we tell customers the steps; we tell them what they get for the price; we give a roadmap. Clients like knowing what’s happening. They understand our end goals.

We communicate; it’s a lot of hand holding up front. With other companies, you buy, for example, 1,000 links for $200 and never talk to a person, or you pay an agency charging huge markups. We’re trying to price our work to be super competitive and still make money.

SM. How is your company different from your competitors?

Mr. Kelly.  We are different because we care if we help companies make money. Many in SEO just care about rankings, but traffic does not drive revenue. We care about conversions; we want the traffic to do something. We give customers pointers on how to improve conversions. We do conversion testing to ensure that clients are spending money on traffic that converts.

SM. How would you describe the personality or character of the company?

Mr. Kelly. It’s fun and flexible here. We have no set hours. We’re focused on getting tasks done. We have a project management system so we know if anyone is lagging. It’s like flexibility on a leash.

Employees have unlimited time off. Everyone works hard–at or over capacity. People often take one to two weeks off at a time. It’s important to work hard and play hard. People need to reenergize. You need balance to be productive.

There’s also flexibility in where you work. You can work from home or at the office—everything is in the Cloud so employees can do work remotely. We use our office for teamwork and collaborative activities, meeting with customers, and training.

We are also flexible in our processes. Employees give input in how we do things. They feel ownership. Employees can directly affect the way the company operates. We change things constantly.

We value decision-​​making and empowerment. I would rather have employees make mistakes and learn. They don’t need to come to me for every question. I’d rather have employees make decisions and make mistakes as long as they learn and are working to make customers happy.

We want to have fun, too. We have a ping-​​pong table and video games in the office. People work hard for two to three hours, and then they play a game. You need a break from looking at a computer screen.

Everyone is from different backgrounds. We train employees from the ground up. We have a lot of Gen Y, first-​​job employees who have recently graduated from college. They like a flexible, fun and empowering workplace.

SM. What are the things about Pear Analytics that should never be changed?

Mr. Kelly. We don’t have meetings. They’re often a waste of time. We have 5–15 minute maximum, morning huddles, often at 10am with Skype. We discuss news, where people are stuck, what’s happening, customer metrics, and where we are with tasks.

Also, everything is open. There are no closed-​​door offices or cubicles. We all sit together.

SM. What values, if followed by all employees, will allow the organization to compete and thrive?

Mr. Kelly.  Integrity, honesty, and transparency–I’ve mentioned them earlier. Those are critical.

We also want to deliver “kick-​​ass” service. We want to be the best at that. We don’t sell what people don’t need or what they’re not ready for. We want to have the right customers—if $500 is all a person had, I wouldn’t take that customer. This work is an investment; it may take time to get the results you want. We set expectations upfront; there’s no crystal ball—only historical data.

We also are building our technology to make jobs easier. We have that Kaizen mentality of continuous improvement. We want to be the most efficient and the least wasteful. We must build scalable and repeatable work. We monitor what gives the best results, and we repeat it. We’ve taken a service model and are making it repeatable. We want to be in the middle–between service and software. We’re trying to invent new and better processes to enhance our technical competencies so its’ easier to do one’s job, and we can save time and can grow the business.

SM. How do you get employees to be on the same page?

Mr. Kelly.  I try to communicate our mission, vision and values with employees. I want our company to be the most well known Internet marketing company in the world.

I also make sure we hire people who are self-​​starters and who don’t need explicit instructions. They just get done what needs to be done.

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Organizational change model: The Five Ps

by Sheila Margolis on July 28, 2011

The Five Ps is a model that depicts a system-​​wide view of an organization. You can use the Five Ps to understand your organizational culture and to use culture to manage change.

The Five Ps

The Five Ps

Once you have defined the central three Ps of the Core Culture, you can bring change by aligning the Internal and External Practices and the Projections with the Core Culture attributes.

Alignment of the Five Ps

Alignment of the Five Ps

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The Building a Culture of Distinction program is a four-​​step process for bringing needed change to an organization. Use this process to guide you in using culture to drive change.

An Organizational Change Model: The Culture of Distinction Program Cycle

The Culture of Distinction Program Cycle

The steps of the organizational change process are as follows:

1. Define the Core Culture of your organization

  •  Define your organization’s central principles—its Purpose and Philosophy—that describe the organization’s contribution to society and distinctive character.
  • Build on that identity-​​​​defining foundation by establishing the strategic Priorities that will enable your organization to compete and thrive.

2. Audit for alignment

  • Audit your Internal and External Practices and Projections to evaluate their alignment with the Core Culture–the Purpose, Philosophy, and Priorities.
  • Calculate your Alignment Index and provide recommendations to improve alignment.

3. Develop a plan to improve alignment

  • Develop a Core Culture Alignment Plan to improve alignment of Practices and Projections with the Core Culture.
  • Set measures to improve alignment.

4. Implement the plan and monitor success

  • Execute the plan to weave the Core Culture principles throughout the organization so everyone lives by the principles that will generate success.

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Organizational culture assessment–questions to consider

by Sheila Margolis on July 25, 2011

When conducting an Organizational Culture Assessment, use these questions as a guide when collecting information through interviews, open-​​ended surveys and/​or focus groups. During interviews, be sure to ask follow-​​up questions to enrich the information you collect. Encourage examples and stories.

Although the questions are designed to reveal particular attributes of the Core Culture, you will find that the responses are not always clear cut. Often people’s responses do not directly answer the question. Be open to what the information you collect actually reveals. For example, a Philosophy question might yield a Priority. You must understand the differences between a Philosophy and a Priority so that you classify the response in the most appropriate attribute category. Review the explanation of the Five Ps to ensure you understand these concepts.

Some of these questions sound repetitive. Often, using a slightly different word or phrase in a question will yield either confirming or new, insightful responses.

Below are some questions to consider asking employees in your process for conducting an organizational culture assessment.

Introductory Question

  • What words would you use to describe this organization? Give examples of each word.

Purpose Questions

  • What is the purpose of this organization?
  • Why is the work you do important? (Ask this question up to five times in an interview.)
  • How are you making a difference to society through your work?
  • What is your contribution to society through your work?

Philosophy Questions

  • What special attribute does the founder/​leader possess that has influenced the character of the organization? Explain.
  • Describe the ideals that drove the founding of this organization.
  • What value is fundamental and distinctive to this organization since its founding? Give examples.
  • What makes this organization feel different or unique from our competitors?
  • Describe the personality or character of this organization.
  • What is central to who we are as an organization that should never change?

Priorities Questions

  • What should we focus on and pay attention to?
  • To effectively achieve our strategy, what principles should guide how we work? Explain.
  • What key values, if followed, would help the organization compete and thrive?

 

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What is an organizational culture assessment?

by Sheila Margolis on July 25, 2011

An organizational culture assessment is a process for defining and shaping the culture of your company. The outcome is a well-​​defined set of Core Culture principles and values (the vital Purpose, the distinctive Philosophy, and the strategic Priorities) that center the organization and provide the criteria for all employee practices.

If you’ve never conducted an organizational culture assessment, now is the time to consider it. There are several options for conducting a Core Culture Assessment. Choose the option that works best for your organization.

  • Option 1: Conduct a Comprehensive Core Culture Assessment. This comprehensive culture-​​defining process requires the support of a consultant with this specialty. A trained professional has an outside view of the company which is often clearer than the perspective of a company employee. First, collect data (see sample questions) through interviews and open-​​ended surveys and/​or focus groups. Next, triangulate the data with a closed-​​ended survey (based on the analyzed data) for all employees. Then, conduct a facilitated session with the leadership team to review data collection results and decide the Core Culture.
  • Option 2: If you cannot afford an outside consultant, consider using this option. First, conduct a Core Culture Assessment Workshop with the leadership team using the Building a Culture of Distinction workbooks. The facilitator will use the text: Building a Culture of Distinction: Facilitator Guide for Defining Organizational Culture and Managing Change. Participants will use the Participant Workbook. Next, collect views from all employees through a closed-​​ended survey (based on the core culture options that came from conducting the workshop). Then, conduct a follow-​​up facilitated session with the leadership team to review the closed-​​ended survey results and decide the Core Culture.
  • Option 3: This option works well in a relatively small organization where employees will feel comfortable sharing their views openly. First, conduct a Core Culture Assessment Workshop with the leadership team using the Building a Culture of Distinction workbooks. The Facilitator Guide will be used by the leader of the process. Workshop participants will use the Building a Culture of Distinction: Participant Workbook. Then, have an open session with all employees to discuss and alter or confirm results.
  • Option 4: If the organization has fewer than 25 employees, you might consider conducting a Core Culture Assessment Workshop with all employees. The Facilitator Guide will be used by the leader of the process. Workshop participants will use the Building a Culture of Distinction: Participant Workbook.

An organization that has not taken the time to define its core culture principles lacks a clearly-​​defined identity. And with that lack of clarity, the organization will struggle to be successful. It will experience inadequate performance and unattained goals. In successful organizations, employees are united in shared principles.

Take the time to assess your organizational core culture. It will jump start a process for positive change. Contact me for information on the best way to conduct an organizational culture assessment for your organization.

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Use organizational Purpose to unite employees

by Sheila Margolis on June 17, 2011

Purpose: Why is this Work Important?

The Purpose of an organization is the most central component of its culture. The Purpose defines why the organization exists. The Purpose is not the answer to the question “What does the organization do?” That typically focuses on products, services and customers. Instead, the Purpose is the answer to the question, “Why is the work of this company important?” This may sound like a simple question, but in its simplicity, lies tremendous significance for the organization and for each employee.

The Purpose is the cause that defines the contribution an organization makes to society through its work. Of course, businesses exist to make a profit, but they also exist to make a difference. Through their firm’s work, employees can make a difference and be part of a meaningful legacy. When an organization’s Purpose is meaningful to an employee, that person feels a connection to work that is not only rational—it’s also emotional.

Purpose Statement: Be Brief in Length and Broad in Scope

A Purpose statement is a few, crucial words that inspire and motivate employees who care about making that contribution. For example, the Purpose of a bread company might be, to nourish life. And the Purpose of an entertainment company might be, to make people happy. The Purpose statement is brief so employees can remember it and use it to guide their daily actions. Additionally, the Purpose statement is broad in scope to allow the organization to adapt over time to a changing world while keeping a constant, consistent central focus. Products and services often change, but the Purpose endures. Think of your company as a living entity; it is a vehicle for improving individual lives, and the world we live in.

Defining the Purpose: Include Everyone in the Process

When defining your company’s Purpose, be sure to include everyone in the process. Participation in the process builds commitment. Use small group discussions to come up with possible Purpose statements. Then, let everyone respond to a collection of options to see the statement that best conveys the fundamental reason why the company exists.

A Purpose statement does not have to be unique. Other organizations doing similar work may have a similar Purpose. Your Purpose should use words that are meaningful to employees and appropriate for your organization.

Purpose Statement: Screen Using the Six Criteria

Be sure your Purpose Statement meets the six Purpose criteria:

  1. It is a contribution to society—not a product or service.
  2. It answers the question: Why is this work important?
  3. It is inspirational and motivational.
  4. It uses powerful words.
  5. The statement is brief in length so employees will remember it.
  6. The statement is broad in scope to allow for future opportunities and change.

Use this worksheet for evaluating Purpose Statement Options: Organizational Purpose Statement Options To Be Evaluated

A Source of Meaning: Unite Employees with the Purpose

Take the time to unite employees around the organization’s Purpose so that work is more than daily tasks. Work should be viewed as a contribution to society and a source of meaning for each employee.

 

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If you asked employees–what are our company’s distinctive values–how would they respond? Would they share a similar view of what’s unique and distinctive about your organization? In successful companies, employees know and live by the distinctive values that are core to it. These values are guiding principles that connect employees and build a sense of family. The values are a source of pride, and the shared practice of these values produces a distinctive workplace and customer experience that sets your company apart from others.

Many companies have clearly defined guiding principles that most employees share. Typically, they have a leader who understands how to build a community of workers who are bound by a shared Philosophy.

Zappos is one example of such a company. The CEO of Zappos–Tony Hsieh–is known for sharing with everyone, employees and the public, the company’s core values. If you look on their website, the Zappos Family Core Values are listed with a video explaining what they are and why they’re important. These descriptions by real employees give a clear picture of what’s valued in this company. Employees describe the core values as the foundation of their culture. The values capture what employees feel make the culture special. Employees are selected because they understand the core values and want to embrace them and practice them. The company even has little pictures to capture each core value.

Zappos Core Value-​​Deliver WOW through Service

Frog images of each of their values are terrific ways to communicate what’s important at this company.

Additionally, Tony, the founder and CEO, also wrote the best-​​selling book Delivering Happiness to share his founding principles and values that are central to the culture.

Take your company values seriously. Hire for them, live by them, and be sure the world gets it, too. Be known for what makes your company special. Be clear on what makes your company distinctive. It all begins with having a shared Philosophy that all employees understand and want to live by. Define your core values and make them a part of every aspect of your company.

 

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According to the WSJ, Walmart will be reporting a second straight year of declining domestic same-​​store earnings. The cause is attributed to the company’s move from its core culture centered around the principle of providing everyday low prices to the American working class.

According to the Walmart website, they state that three simple principles that were part of their founding in 1962 are what make them great.

  1. Respect for the Individual–We’re hardworking, ordinary people who’ve teamed up to accomplish extraordinary things. While our backgrounds and personal beliefs are very different, we never take each other for granted. We encourage those around us to express their thoughts and ideas. We treat each other with dignity. This is the most basic way we show respect.
  2. Service to our Customers–Our customers are the reason we’re in business, so we should treat them that way. We offer quality merchandise at the lowest prices, and we do it with the best customer service possible. We look for every opportunity where we can exceed our customers’ expectations. That’s when we’re at our very best.
  3. Striving for Excellence–We’re proud of our accomplishments but never satisfied. We constantly reach further to bring new ideas and goals to life. We model ourselves after Sam Walton, who was never satisfied until prices were as low as they could be or that a product’s quality was as high as customers deserved and expected. We always ask: Is this the best I can do? This demonstrates the passion we have for our business, for our customers and for our communities.

Walmart’s changes in their merchandise and even the look of their stores was designed to attract higher-​​income customers. Then they instituted discounts on select items while raising prices on others–not in keeping with their tradition–and part of their core culture– of everyday low prices.

The company Purpose is simply stated by Walmart:

Saving people money to help them live better was the goal that Sam Walton envisioned when he opened the doors to the first Walmart. It’s the focus that underlies everything we do at Walmart.

Sometimes we get distracted from our roots in our attempts to grow and thrive. But when a company changes its central principles, then the company confuses its loyal customers and its employees. Changing core principles should be avoided unless it is required for survival.

Companies should define their vital Purpose and their distinctive and enduring Philosophy and understand that those attributes are their identity, and they should always be preserved.

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Another recall for Toyota. Now over 1.7 million vehicles world-​​wide including some Lexus models are being recalled for defective fuel devices or other faulty parts. What is happening to quality at Toyota?

It all goes back to knowing what’s core to your culture and never compromising on it. Every organization must define what values must be shared by everyone in the organization. These are the values that are never compromised. These are the values that each employee takes pride in and wants to live more effectively each and every day. You don’t want a lot of values–that important– so that there’s no excuses. These few values must be clearly understood. So, for example with Toyota, the focus should always be about quality. Quality should be the blood that runs through the veins of all who work for the company. Nothing moves quality second to anything.

So why do companies mess this up? It’s often a problem of not integrating the value throughout every aspect of the company. It’s about aligning all practices with the core principle. In the case of Toyota, as reported in the Wall Street Journal,

“Toyota has been using more common parts in its vehicles” in order to cut costs, said Koji Endo, an auto analyst at Tokyo-​​based independent auto industry boutique Advanced Research Japan.

Toyota should know better. The suppliers they use and the materials they buy must meet their high standards for quality. Anything less should not be qualified to be in a Toyota product–from the car to the key chain.

The article says Toyota has been taking actions to prevent recalls, such better reporting of safety issues, assigning engineers to focus on quality issues, and spot-​​checking vehicles for potential problems before launch. But maybe that’s just not comprehensive enough.

Every aspect of the company’s internal practices from how the organization is structured, how work is designed, systems for doing one’s work, hiring practices, orientation, training, performance management, internal communications and technology must reinforce the focus on quality.

And every aspect of the company’s external practices including its suppliers, vendors and partners must be screened to set quality as the number one requirement.

Also, the image the company projects should always be about quality. When I look at the Toyota website, I don’t see a dominant focus on quality. There seems to be a greater focus on selling more cars. Maybe the focus on growth has become more important.

If quality is the core value that captures the core essence of what Toyota is all about, then they must make it core to all they do. Costs or any other value cannot be a higher value than quality.

Successful organizations understand that they must define their core culture–the principles that are central to who they are that are never compromised. And employees must practice those few principles in everything that they do.  That consistency is what makes organizations great.

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Hiring for culture fit–Summary-Part 7

by Sheila Margolis on December 12, 2010

Use your organization’s culture to manage retention. When you hire people who are a fit with the culture, there is a greater likelihood that they will want to stay.

First, you must define your Core Culture:

  • The vital Purpose: the fundamental reason why the organization exists—Why is the work you do important?
  • The distinctive and enduring Philosophy: the prime value or set of values that are the character and personality of the organization.
  • The strategic Priorities: those few values that are essential to all areas of the organization and to the area where the applicant will work that will enable the organization to compete and thrive

Then, be sure your hiring—your recruitment materials, recruitment practices and interview process—is aligned with your Core Culture so that you are effectively screening for culture fit. It is essential to hire people who naturally value the Core Culture attributes that are central to the organization.

Think of culture as your distinctive advantage—as your unique fingerprint.

Herb Kelleher, founder of Southwest Airlines, put it this way, “Everything (in our strategy) our competitors could copy tomorrow. But they can’t copy the culture—and they know it.”

Think of your culture as the basis for your business success. Former IBM Chairman and CEO Louis Gerstner, Jr. stated in Who Says Elephants Can’t Dance?, “Until I came to IBM, I probably would have told you that culture was just one among several important elements in any organization’s makeup and success — along with vision, strategy, marketing, financials, and the like. I came to see, in my time at IBM, that culture isn’t just one aspect of the game; it is the game. In the end, an organization is nothing more than the collective capacity of its people to create value.”

To build your culture of distinction, you must define your Core Culture and then hire people who personally connect to the Core Culture, and want to live by it. Use your unique culture to manage retention and drive your organization’s success.

[This post concludes a seven-​​part discussion on Hiring for Culture Fit]

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