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Building a Culture that Rocks at Qulture

Francisco Homem de Mello

The other day I was invited to give a talk at a customer’s annual strategic planning offsite. The company, which shall remain nameless, is less than a year old and already has more than 1500 employees, dozens of millions of dollars in funding and its products are used by thousands and thousands of people every day. I was honored and humbled by the invitation, because they had asked me to talk about a very dear subject to me: how to build the high performance organizational culture.

I am definitely not one that has already “been there and done that” when it comes to building a high-performance culture . A better way to describe my credentials for the task at hand would be rather “am there and trying to do that as we speak.” But, I’ll concede that I’m both very passionate and very invested in the subject, since Qulture.Rocks depends doubly on my ability to do so: First, because if we fail to build a high-performance culture, we’ll not survive in almost any line of business these days, specially in high tech; second, and most important, because our products and services at Qulture.Rocks are hired by customers with the specific job-to-be-done of helping organizations foster high-performance cultures. It’s even our company’s name!!!

So I decided to write an article that mirrored my talk at the off-site, explaining what we’ve been doing at Qulture.Rocks to foster a high-performance culture. I hope it helps you on your journey (it certainly helped nameless company :).

What is a high performance culture?

I think a good first step for us is to define what a high-performance culture is. It’s a very loaded term, because both “culture” and “high-performance” are hard to define.

Let’s start with culture. I’ll take a stab and define “culture” as a bunch of things, deliberate and not, that affect how people behave in an organization’s many settings. These things can be personal values that people hold, values that the company has prescribed as its own, examples set by leaders, physical artifacts around the spaces – e.g., offices – the company operates in, stories people tell themselves and, finally, formal and informal rituals the organization has embraced. All of these things affect how people behave, and this whole system, inputs and outputs, is what I call culture.

Now let’s try to define high-performance. Marcel Telles, who was a cofounder of 3G Capital and holds board seats and/or major stakes in AB InBev, Kraft Heinz and Burger King, has a great definition of what leadership means, which I think applies snugly to our attempt at defining high-performance more broadly: “hitting goals, with the team, the right way.” There’s little to explain here: “hitting goals” means, by proxy, achieving results; “with the team” means teamwork and being a accretive member of the group; “the right way” means in accordance with the company’s core competencies, which must be intrinsically tied to its strategy and positioning in the marketplace.

So what is a high-performance culture? A high-performance culture is a system of values, rituals, examples, incentives and stories that encourages people to hit their goals, with their teams, the right way.

How we’re trying to build a high-performance culture at Qulture.Rocks?

Now that we know what a high-performance culture means, we’ll jump into what we’ve been doing at Qulture.Rocks to try to become one ourselves. From now on, I’ll be describing the inputs of the system – values, rituals, examples, incentives and stories – that we’ve put in place, more or less deliberately, and that we believe is helping us achieve that goal.

Team x family

A very clear distinction has to be made in an organization that wants to foster high-performance: that it’s not a family, but a team. Netflix does it well in its seminal culture deck where then CEO Reed Hastings states the company is more a professional sports team, where players are naturally expected to perform (and go to the bench if they’re not performing,) than a family, where love is unconditional regardless – or almost regardless – of how someone behaves and “performs.”

I’ve experienced firsthand how the lack of clarity around this concept can be painful to the employees of an organization, especially, but not restricted to, younger, less experienced team members. Young people on their first jobs have often never seen somebody be fired for performance (or for any other reason, for that matter). They are very much emotionally attached to other team members, and confuse the nature of their relationships (friends – bffs – versus coworkers). And that’s fine, to some extent – pro football players are friends as well, and bond a lot together. The difference is they know these relationships are one thing, and their belonging to the A-team is another. I’ve seen Q.Players – how we call ourselves at Qulture.Rocks – be shocked and wounded by a colleague being fired, and that’s not good.

I’ve experienced firsthand how the lack of clarity around this concept can be painful to the employees of an organization, especially, but not restricted to, younger, less experienced team members. Young people on their first jobs have often never seen somebody be fired for performance (or for any other reason, for that matter). They are very much emotionally attached to other team members, and confuse the nature of their relationships (friends – bffs – versus coworkers). And that’s fine, to some extent – pro football players are friends as well, and bond a lot together. The difference is they know these relationships are one thing, and their belonging to the A-team is another. I’ve seen Q.Players – how we call ourselves at Qulture.Rocks – be shocked and wounded by a colleague being fired, and that’s not good.

What we’ve done: we started being more clear about the fact that Qulture.Rocks is more of a pro sports team, and less of a family, and that some people will eventually be fired for performance, and that it’s part of the job. And that if they want a stable, “family” place to work, they should look somewhere else – we’ll even help them!

Management by OKRs

Another cornerstone of how we operate is what I call “Management by OKRs.” If you’re familiar with goal management, you’ll notice I’ve mixed “Management by Objectives,” which is a management philosophy created by Peter Drucker in the 60s, and “OKRs,” which are a flavor of MBO developed more recently in the Silicon Valley.

This is not an article about goal management, so I’ll stick with how all of that relates to a high-performance culture: in sports, goals are much more clear-cut. A team either wins the game or doesn’t. Games lead to a championship. Scores are simple and clear. Businesses, on the other hand, can be much more complex. There are no natural black and white definitions of winning and losing posed by some International Business Federation. That’s part of where OKRs come in. Distilling your company’s winning vision into clearly measurable OKRs helps people align around a common North Star. Unfolding that higher goal into stuff every team, manager, and individual contributor can do to help is how everyone gets involved and is able to zoom in and out of their areas of focus.

OKRs also help the team have a clearer sense of the difference between results and efforts, and that’s key for high performance. Again, let’s bring back the pro sports analogy: Professional players know that there’s no point in doing great work during training season and not winning games, scoring goals, and taking home the trophy. But in business, people get confused and tend to think results are not required if the efforts were intense and right.

What we’ve done: We run our company in 4-month OKR cycles where people clearly commit to OKRs, which are results, and projects and initiatives, which are efforts. Every cycle is composed of a planning phase, where Q.Players set commitments according to company strategy, monitoring phase, where Q.Players follow-up and problem solve on their off-track commitments, and, finally, debriefing phase, where Q.Players reflect on what went well, what went wrong, and prepare for the next cycle.

Working principles

Another cornerstone of high-performance cultures is a set of working principles.

Some organizations call these “values” or “core values.” I don’t like these terms, because I think values are things that tend to be vague (in the sense that people differ wildly in their interpretations of what they mean) and can’t be objectively observed: you can’t just dissect someone’s brain and see what beliefs  she holds. Therefore, I prefer to call these “principles,” or “working principles.” Principles convey the message of something that works as a constitution, that should regulate how Q.Players behave, and that should be aspired for.

What we’ve done: We set our working principles, which are:

  • Eat our own cooking
  • Think and communicate clearly
  • Grow and make grow
  • Be a cofounder
  • Act world class
  • Be apolitical and accretive

We reinforce these principles in many ways, because we think they are key to our success as a company. For example, we have been spending a lot of time to eat more of our own cooking in the past few months. Every Q.Player is highly encouraged to use our product – the Qulture.Rocks Platform – daily, by managing OKRs and projects, planning and taking notes of 1:1s with managers, and giving each other constructive feedback and praise (we’ll talk more about that shortly). To foster more of that, we’ve created the Award Day, where Q.Players who most eat our own cooking get prizes like gift cards and trips.

We’ve also been spending a lot of effort in trying to make the principles become critical criteria in who we decide to hire and reject. I took a lot of inspiration in Stripe’s and Amazon’s hiring practices, which I learned about in a Stripe event for Y Combinator founders: these two companies train most of their employees in interviewing skills that are deliberately targeted around finding out if candidates would behave according to their principles (Amazon calls them “leadership principles”) if hired. Stripe goes even further and trains employees on interviewing for just 2 out of their 8 principles, so that they become highly specialized and accurate in their evaluations.

What we’ve done: We created a 1.0 version of our interviewing form that has us rate candidates in a one to five star scale in each one of our working principles, and offers suggested questions that we can make in order to better evaluate them. Interviewers are asked to fill out these forms after each interview and hand them back to HR, so that an aggregation can be made for decisions. We’re also structuring an interview training course to take it to the next level.

Feedback and praise

Last, but not least, I believe ongoing feedback and praise are a key part of all high-performance cultures.

Pro sports players get constant feedback from coaches and colleagues on their performance, and seem absolutely fine with it. At work, leaders have much more difficulty in giving direct reports constant constructive feedback about how they can better perform. According to our experience in helping more than 140 companies create cultures that rock, we’ve found that most have employees yearning for more feedback at work. Managers, on the other side, largely think they give their reports enough feedback, which just helps widen the “feedback chasm.”

I also believe feedback and praise should be largely based on working principles: workers help each other identify where they’ve exposed – and not exposed – the expected behaviors, and teach each other how to do it even more.

What we’ve done: As note above, we use our own ongoing feedback and praise feature and encourage all Q.Players to give each other lots of feedback and praise. We even recognize those who’ve done it more frequently during our four-month cycles in our Award Days.

So, these are some of the things we’ve been doing at Qulture.Rocks to help foster a high performance culture that helps us reach our mission of helping companies achieve more and create cultures that rock! I sincerely hope this helps you on your journey 🙂