Drop the foosball table: company culture is about values, not perks

Your company foosball table is a perk, not a value.

That’s how Rand Fishkin, founder and self-described Wizard of Moz, the Seattle-based SEO software company, puts it.
He joined Patty McCord, former Chief Talent Officer at Netflix, and SEER Interactive founder Wil Reynolds and Lead People Person Emily Allen to talk about company culture. They led the “Pioneers of Company Culture” event last Thursday, which was the last one SEER will have at their outgoing, iconic Northern Liberties Search Church offices. The three-and-a-half hour event was full of wisdom, anecdotes, lessons learned and war stories. Here are the top takeaways:

Perks versus Culture

Rand on culture: it’s what you believe and “what you wouldn’t violate” for more money. The obvious example is an ethical dilemma (“our proprietary ad network doesn’t include gambling sites”), but the trickier ones involve difficult choices about who your company is and why it exists.
McCord shared a story about how Netflix actually created Roku, had the product ready to ship from China, were chilling champagne in the board room and then paused. As Patty recalled, the engineer who led the product said, “At the end of the day, all this product is is a chip. If it were my company, I’d get that chip from Samsung, Sony or Nintendo – not Netflix.” Sure, this could’ve been a new revenue stream, but the story goes that Netflix felt it was out its of mission. So they spun everything off into a new company that became Roku and were able to remain platform agnostic.
Patty added that culture is “what people do when nobody’s looking.” It’s not about having your ping pong table on your “Work With Us” page or pics on Instagram of your Halloween costumes (not that there’s anything wrong with that). It’s the Netflix leadership team making a decision behind closed doors to spin off a new technology because it’s not part of the reason for your company’s existence.

Hire to solve business problems

The key to building great teams? According to McCord, it’s figuring out what problem you need to solve, what success looks like and finding the person who is passionate about solving it. As she put it, “I’d rather have someone who has almost all the skills but twice the passion.”
One key to getting this right is knowing where your company is in its lifecycle. Here’s how McCord described these stages and the personnel needed:

• Startup mode – Lots of problems are solved by hard work. In a startup, you need to try a ton of things, fail, and learn. This is where companies load up with smart, inexperienced people who can learn / grow on the job.
• Fine tuning – The next stages present challenges that are not simply solved by hard work – despite that fact that the profile of your early employees is what made you successful. Eventually you need people with brilliant insight who can step back and say, “You’re going about this all wrong.”
• Problems of complexity or scale – Some issues with complexity can only be solved by people with highly specialized skills. When streaming video began to overtake the DVD-by-mail side of Netflix’s business, did they go out and get a bunch of smart engineers who could figure it out? Well, yes, but they happened to be the team that had already figured out streaming for Yahoo.

Reading between the lines, it might not always be about getting the next inexperienced, single, hard working smart person who can learn on the job (read: CHEAP). Depending on the business problems presented by the current stage of your company’s lifecycle, you might need a different skill set or level of expertise.

How to fire an employee: Acknowledge that it’s not working out

It was somewhat alarming how often the topic of firing people came up during the event. But it’s not surprising. If the playbook for an early stage startup is to fail fast so you can learn what doesn’t work, then it’s not surprising that “failure” would apply to hiring as well. Which is why McCord doesn’t think we should use the warlike “firing” metaphor anymore. Let’s have transparent conversations about the fact that it’s not working out. And, by the way, it’s OK if that’s on you for not knowing exactly what you needed when you first hired the person.
According to McCord, the first two things you say in these conversations are: “This is going to be a tough conversation” and “thank you for everything you’ve done.” In other words, don’t make small talk before getting to the point.
(Another tip: call your voicemail and leave a message with your planned spiel to the employee you’re going to cut ties with. Chances are, you’ll realize how awful/awkward it sounds and then come with something much more appropriate.)
Lastly, “RIP the PIP” (Performance Improvement Plan). As Patty said, PIPs are a “game companies play so [they] can fire people legally by giving them progressively harder things to do.” Startups don’t have time for that game. Again, just acknowledge that sometimes it doesn’t work out and move on. That business problem you attempted to solve with this hire is still festering.

Diversity’s not going to happen by itself, pt. 1

Rand Fishkin was asked by SEER’s Reynolds about his insistence on diversity among MozCon panelists. Rand responded that, sure, he wants to be part of a world where the talent pool is such that he can get a diverse roster of presenters without being proactive. But, in the meantime, you either fight against reality or become part of it. Same with goes for building your team.
Clearly, diversity is very important to Fishkin, which is commendable, but Wil asked the question that was certainly on the minds of many people in the room: how has a diverse team made Moz a better company at what it does?
Rand believes that it has made Moz a more “authentic, generous, and empathic place.”

Diversity’s not going to happen by itself, pt. 2

SEER has a workforce that is about 65 percent women, according to Reynolds. One of the things he’s noticed, for example, is that often “guys talk too much, women don’t say anything until the last five minutes, and it’s smarter than what was said in the previous fifty-five.”
So what do you do? At a high level, Patty’s advice is to acknowledge there are biases that you’re not aware of. This transparency “gives women permission to tell [men in leadership positions] ‘you’re doing it again.’”