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Culture May Eat Agile for Breakfast

| Posted by Stefan Wolpers Follow 0 Followers , reviewed by Ben Linders Follow 12 Followers on May 05, 2017. Estimated reading time: 13 minutes |

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Key Takeaways

  • No organization exists in a cultural void. If you do not actively shape your culture, something will emerge.
  • Resist the urge to hire merely for skills.
  • Your existing agile culture can easily be overwhelmed by the influx of new culture fragments.
  • Don’t incentivize HR to fill open positions as soon as possible.
  • Ruthlessly educate all new hires and remove misfits with a non-agile mindset early in the process.

Can an Organization Double in Size Annually and Stay or Become Agile at the Same Time?

Most of the discussions in the agile community circle around the question how to transform legacy organizations. However, there is another area that deserves equal attention: agile and fast-growing startups.

The cardinal question is: can building a culture around an agile mindset be a priority in a fast-growing startup or organization at all, given the pressure by investors, the management, and the founders?

Most new hires in these startups are typically recruited for a particular skill set but not an agile mindset. We have observed time and again, most recently during the Susan Fowler & Uber incident, that anti-patterns like hiring brilliant jerks, bro-ism, discrimination at all levels, and failed inclusion often dominate the social fabric of a fast-growing organization. And most likely, the pattern might kill a nascent agile culture en passant.

Five Hypotheses about Culture

#1: There Is No Organization without a Culture

Every organization has a culture, even without knowingly pursuing organizational design. Culture takes care of itself. Culture is how everyone treats customers, their colleagues, and business affairs – when you're not looking.

#2: Corporate Values and Perks

What is not a part of your culture, though, are posters with corporate values – framed and pinned to the walls –, or yoga lessons and organic cereals. The latter are no more than perks, as Ben Horowitz details in “Culture and Revolution.”

#3: Culture Follows Structure

Culture follows structure. If the leadership fails to actively guide creating a culture, for example by being a role model, something derived from structure will fill the void.

#4: Individual Incentives Contribute to a Great Culture

An outstanding culture is built on trust. Trust is the beginning of everything, and it does not grow in a deliberately competitive environment as it requires transparency.

#5: Autonomy & Diversity Are Sound Business Decisions

Diversity, inclusion, and self-organization are not merely nice-to-haves; they are the foundation of all thriving cultures, learning organizations, and hence profitable businesses.

The Need for Structure

The need for organizational structure in a fast-growing organization results from the growing pain that accompanies the growth of the staff.

When time is at a premium, the solution to counter chaos, miscommunication, non-alignment, and often failure, is not deliberate process design or creating adequate technical solutions. The quick fix to dealing with problems of all kinds is throwing more people with a particular skill set at it.

Originally rooted in the “fake it ‘til you make it” practice, the approach used to be of an intermediary nature to gain time while figuring out or preparing the right solution. Nowadays, it is the answer particularly in areas like sales or customer service, the latter often acting as an extension of an inadequate product or service.

Adding people to fix issues manually turns out to be psychologically challenging at the leadership level. There often is an immediate feeling of adding value by fixing a problem. However, this initial short-term success is achieved at the expense of the long-term solution by making it seem less urgent. Hence, this path means focusing on the low-effort-low-outcome quadrant, when the organization should address the real issue at hands: how to preserve its culture when hiring starts focusing on providing skills, not mindset?

How to Fend Off Invasive Cultures and Stay Agile

The easy way out of this challenge would be to strike colors and concede defeat. If a firmly structured organization was good for General Motors in the 1920s, it cannot be entirely wrong today.

If short-term thinking pushes the organization to hire new staff, why not add some management layers at the same time? Sales agents and customer service agents are anyway used to hierarchical reporting structure, making Zappos the exception to the rule for a long time come. Hire some senior professionals with a consulting or business school background, and the scientific management method will take care of creating functional silos, and establishing bureaucracy. The PMO will bring order to chaos, and reports will be written, circulated, and discussed in endless meeting – like anywhere else.

The collateral damage of this strategy is that the new hires will likely overrun your current nascent agile culture – if you’re not prepared to invest heavily alongside the hiring process, which contradicts the reason for growing the staff so quickly in the first place.

This investment comprises of two components: a) hire for mindset, and b) educate everyone joining the organization in agile principles.

Legend:

  1. Make-or-break Frontier:
    1. Peer recruiting: Let the teams pick new teammates
    2. Onboard thoroughly
    3. Educate everyone without exception
  2. Your Future Ambassadors

Hiring for Mindset

People rarely change their character and habits in a meaningful way if asked to do so. Those who are not entirely aligned with the values of an organization may adapt their behavior temporarily, but they will never identify themselves with the organization in the first place. There will always be reservations or personal agendas of a higher priority. If you hire for skill set, you probably end up with mercenaries.

To avoid hiring them, look for people with the right agile mindset; the kind of people who understand that autonomy without accountability ends up in anarchy, for example. Also, consider changing the hiring process itself: engage all teams actively in recruiting new colleagues, and elevate the human resource department to a servant leadership role, facilitating this peer recruiting process. (Read More: Peer Recruiting: How to Hire a Scrum Master in Agile Times.)

You may wonder why a change of process will be required in the first place? There are plenty of reasons, my top three being:

  1. It’s consequent: on the one side, teams are empowered to make decisions that directly impact the return on investment. On the other hand, are they being patronized by deciding on new teammates for them?
  2. It also means the teams have skin in the game. They will be motivated to go the extra mile and make the new connection works. Now, it is their responsibility.
  3. Lastly, not involving the team immediately signals to all candidates that your organization isn’t agile, but merely “doing Agile”—a weak value proposition in the war for talent with an agile mindset. (Note: Josh Seidan believes that the war for talent is over, and talent has won. [Don’t be confused by the misleading title of the podcast. It is all about the correlation of culture and entrepreneurial success.])

Make it a habit to hire only those candidates who pass a trial day working with the prospective teammates on a real problem of the organization. A useful trial day usually requires a full working day, which is a significant investment. So, choose candidates for a trial carefully.

Note 1: Elevating the HR department into a servant leadership role does require patience as well as someone at the HR helm who already is a leader. If your HR department is most of the time busily browsing LinkedIn to pitch open positions to prospective candidates, they will not be enthusiastic about the new direction.

In their mental model, HR is actively building a great organization by hiring the best candidates in a fiercely competitive environment – the war for talent. And now you are asking them to become a supportive force, while the teams are reaping the rewards of ‘their work’.

The situation becomes worse in the case where HR is financially incentivized to fill open positions as fast as possible (for example, a bonus decrease over time, if a position stays open for a predefined number of days or weeks). This practice is not compatible with peer recruiting but creates an instant conflict with the intrinsically motivated teams looking for new teammates.

Note 2: Menlo Innovations takes the trial process even a bit further: “So we bring people in and get them to speed date with our staff. The question is always: would you like to work with this person? If the answer is yes, then we bring them into work with us for a day, then a week and then a month. If the answer is still, “Yes, I would like to work with this person,” then they are hired.”

Note 3: Even more impressive is Zappos’ approach to buying out those candidates after a week that prefer $ 3,000 over a career at Zappos (which is merely 3 % of all candidates that make it to the trial phase).

In the end, according to Cameron Sepah, “Your Company’s Culture is Who You Hire, Fire, & Promote.

Educate Everyone Joining the Organization

The “educate everyone” approach needs to be taken literally: put everyone, without regard for role or position, through a rigorous, mandatory onboarding process that comprises of two components:

Hands-on Practical Experience:

The onboarding process needs to stress the importance of hands-on practical experience in the trenches. Put everyone, including the new CFO as well as every engineer, through sales, customer care, or the warehouse – you get the idea.

This practice is not just a fast-paced training on the job regarding the core business issues. It also helps to build informal networks that will significantly improve communication between stakeholders and product teams at a later stage. Lastly, it is an effective means to expose all new hires to the existing culture by being embedded in teams that already live it. The new kid on the block rarely changes the current culture during the first two weeks but is rather assimilated.

Two weeks seems to be the minimum practice period in a larger organization, as new hires need to stay at least a week at each station of the trench tour to be accepted as teammates (at least, that is my learning from organizations with sales and customer care departments making up between 50 to 60 percent of the total workforce).

At a social level, the new hires need to be able to build trust with their teammates, and building trust does not happen overnight. If the temporary teammates regard new recruits merely as visitors passing by, it will defy the purpose of the exercise. 

Note: Avoid introducing new hires at the beginning of the practice period with their titles. Titles may create unnecessary bias and agendas, thus reducing the utility of the practice (example: it’ll suffice to mention that Bob will be working in finance, you do not need to stress that Bob is the new CFO).

Train Everyone How to Build Product

Providing hands-on experience in the operational trenches of the organization is just one side of the medal. The other side is to teach every new hire how to build a product; for example, how to prototype an app.

Even absolute beginners can create a clickable prototype of an app within a day or two, and learn a lot about product management, product design, and user experience along the way. A prototyping workshop is also an ideal playground to familiarize every new hire with agile practices, such as Scrum, Kanban, Lean Startup, or Lean UX.

The workshop format I like to practice consists of seven main exercises and is most successful with a group of ten to twelve participants:

  1. The kick-off of the workshop is to define the kind of app that the teams are supposed to prototype. It needs to be an area everyone is familiar with (in the example shown above, we chose to create a team-event organization app).
  1. The first exercise is to deal with the difficulty of figuring out what kind of app to build. It is about learning that generating ideas is not the issue – ideas are a dime a dozen. The participants quickly realize that the real challenge is to determine a problem worth solving with the app. In the end, the team will come up with an initial concept of what kind of app they want to build.
  1. Next is an introduction to user story mapping. The exercise is not called that way, but the group needs to learn first how to turn a bunch of random ideas into a basic concept. We exercise this with the breakdown of the morning ritual of getting out of bed and to the office into single steps. We also introduce the idea of versioning or minimum viable products by imposing a time constraint: “You did not hear the alarm clock, and you have to leave within five min”.
  1. Then, we run a session creating a customer journey for the app. The result is achieved by splitting the group into two competing teams. At the end of this exercise, both teams pitch their solution to the other team.
  1. During the following exercise, both teams join forces again to create a unified customer journey/user story map (it never hurts to experience design by committee).
  1. Once the unified concept of the app is available, the group splits into the previously formed two teams again, and both teams start creating their first set of mockups, thus delivering the first version of the prototype. This “sprint #1” is time-boxed to 60 minutes, including a short sprint review by both teams at the end during with they demo their prototypes. Also, each team spends five minutes on a short retrospective.
  1. Following the sprint review, the teams are encouraged to gather feedback by running user tests before starting the next sprint.
  1. Repeat the cycle with the next iteration.

Depending on the available time – the workshop can be held within a day; two days would improve the learning experience – the teams will create a more or less refined clickable prototype (the participants shall not leave the workshop empty-handed as the prototype acts as a token for the group experience). The regular feedback from participants I have heard so far ranges from “Great”, to “Now I understand how complex a product’s job is, and I don’t want it” and “I’d like to learn more about it, it’s fascinating.”

Note: Sending new hires simply off to regular external training classes, such as Scrum Master certification workshops, tends to be less beneficial by comparison. The intended outcome of the workshop is exposure to the existing culture and nurturing the creation of new relationships. Learning the agile practices hands-on is a side-effect.

Conclusion

Making culture your priority during the scaling phase of your organization is a sound business decision. Importing alien cultural fragments by hiring solely for skills, and not for personality and agile mindset, poses a significant risk to staying agile or becoming a learning organization.

However, given the often inorganic growth patterns of fast-growing organizations, preserving or creating that agile mindset at the same time is futile once the growth rate exceeds a certain threshold. The author has experienced this rate to be approximately 100 percent annually for three consecutive years in sales-driven organizations (here: three marketplace startups based in Berlin).

Once that tipping point passes, the influx of new hires with mainly non-agile mindsets will turn an existing agile culture into a traditional one. This new culture will likely revolve around functional silos, and command & control-based communication and collaboration patterns (let me share an example: one morning, the [new] co-managing director informs the product management organization that from now on a project management office will support them by freeing them from the communication with the internal stakeholders, so the product managers can focus on writing user stories).

You may even accelerate this undesirable process by starting incentivizing individuals, for example, with bonuses. Incentives of this kind tend to foster personal agendas, harden functional silos, and lay the ground for all agile team building efforts to become futile in the future.

The before mentioned threshold of 100 percent growth of staff per year will be even lower in organizations with individual monetary incentives.

If you now do the math, educating every new hire in the startup will require about three to four weeks of time, as well as a significant investment in facilities and coaches. You will also have to invest upfront, as scaling your educational team in time will prove to be tricky. Are you prepared to make these investments?

About the Author

Stefan Wolpers — based in Berlin, Germany — has been working for 11+ years as a product owner, agile coach, and Scrum master. He has developed B2C as well as B2B software, mainly for startups, including a former Google subsidiary, but also for enterprise organizations. He blogs at Age of Product and curates the weekly Food For Agile Thought newsletter with more than 7,000 subscribers.

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