Chapter 6
Building a Culture That Reflects Inbound Values

Corporate culture refers to an evolving set of values, attitudes, ethics, and beliefs that characterize members of an organization and define its nature. Culture influences all business functions from the first touch, through customer acquisition to customer service, and impacts buyers' expectations and goals. As the connected world evolves, culture has taken on a more important role because a quality culture creates employee loyalty and loyal employees generate more value for customers.

Inbound organizations have learned that spending time, effort, and money to create a remarkable culture makes a huge impact. A healthy company culture makes the company a fun place to work, reduces employee turnover, improves recruiting success, and increases employee productivity. Culture keeps everyone aligned more than rules and procedures. A negative company culture can be expensive, inefficient, and hard to mask from the outside world. To practice inbound with your clients, you need to build an inbound culture. An inbound culture creates an extraordinary employee experience.

Culture stems from the way leaders act, not what they say. A powerful way to let employees know the company culture and values is to practice them on a daily basis. People learn the culture from each other: they react to the reward system that they see; observe other employees getting awards, accolades, promotions, and discipline; and adjust their behavior.

“The reason that we invest in culture—and the reason it's our secret weapon—is because we want to make HubSpot a place where the best people can do their best work!” says J.D. Sherman, HubSpot COO.1

Dharmesh Shah talks about culture this way:

In a way, the approach we took to building the culture at HubSpot is rooted in the same inbound philosophy that we advocated for doing business. At the core, it's about empathy and treating people with respect. The good news is that there is nothing complicated about this approach—it's quite simple. First, understand what kind of culture your best people want and build that. In most cases, I think businesses will find that their stars want the autonomy to do what they know needs to be done, support, and investment to learn what they need to know, and transparency to understand what's going on in the business. And most importantly, a mission and purpose that they can believe in.2

Strategy gets most of the attention for the simple reason that most leaders are more comfortable with it as a discipline, but as Peter Drucker said, “Culture eats strategy for breakfast.”

Employees relate to culture in ways that are different from the way they relate to the company strategy. Employees must be immersed in your culture regardless of their location, work responsibilities, role, or position. Culture affects employees while they are at work and during their own personal time. Culture influences employee motivation more than any other variable. In an age of personalized, connected relationships, a company culture is the way that an employee engages with the organization's mission, vision, and values. Today's workforce works for their team, not a boss. With abundant employment options, why would someone waste time working for a company that doesn't have strong values consistent with their own?

In our research, we have identified seven key attributes that are critical to creating an inbound culture:

  1. Trust, Transparency, and Accountability
  2. Putting People First
  3. Teams and Teamwork
  4. Inbound Decision Making
  5. Using Good Judgment
  6. Creating Your Inbound Operating System and Culture Code
  7. Finding Inbound People

We will dig into each of these attributes in detail in the next few chapters.

Trust, Transparency, and Accountability

If you don't have trust, you don't have a relationship. In an organizational context, trust is hard to build and easy to rupture. An inbound organization builds trust at every management level and across all divisions, departments, and locations so that trust becomes a foundation of the way the company functions.

“When there is trust, conflict becomes nothing but the pursuit of truth, an attempt to find the best possible answer. It is not only okay but desirable. Conflict without trust, however, is politics, an attempt to manipulate others in order to win an argument regardless of the truth.”3

How do you build trust in your organization?

  1. Expect it of yourself and the leadership team. Tell the truth. Don't lie. Don't fudge or spin. Be straightforward, especially with subject matter and decisions that are controversial. Frame discussions in simple terms. Provide both supporting and dissenting thoughts on key arguments. If it is important to you, it will be important to others. Make trust a nonnegotiable part of your company. Demonstrate the proper way to behave and how you want others to behave.
  2. Talk about trust in company meetings and one-on-ones and watch how employees react. People may tell you they have high trust, but you see by the way they react if they feel comfortable in the relationship.
  3. Be transparent with information to your employees, partners, and your entire ecosystem. Teach employees to value sharing relevant material more than hoarding it; define what happens to information misers who use access to information for their personal advantage.

Transparency builds trust. Transparency is the act of publishing and sharing all company information (unless it is proprietary, personal, or HR related) to everyone in the organization regardless of the importance, nature, or sensitivity of the subject matter. It means sharing financial information, organizational decisions, company results, product road maps, operational plans, management changes, project timelines, and all relevant information with everyone in the company so that every employee views the data and has the opportunity to form their own opinions.

Why do you communicate all of this information? So that people don't have to take time to figure it out on their own. So they understand your position. So they do their jobs better. So they don't need to engage in gossip or office politics to understand what is going on. So they model the behavior of open discussion that leads to building trust with everyone.

Radical transparency means you trust your employees to be smart enough to make up their own minds. You are encouraging people to think through various options, making it safe for dissenting opinions, and surfacing a variety of different solutions that may not have been previously considered.

Once you share information, expect and encourage it to move freely around the organization. Expect it to be discussed, dissected, reviewed, and examined. If employees have questions, don't understand the impact, or don't realize how they can help, leaders must be available to help employees understand what the information means.

How can inbound leaders be more transparent?

  1. Start with the basics. Create your mission statement and your MSPOT and review them with your leadership team. Make sure there is a healthy discussion around the implications of everyone seeing this information on a regular basis.
  2. Ask each department to construct their team version of the MSPOT. Make sure that they understand the importance of producing the information at the departmental level.
  3. Share financial information via “open book” management. Explain the generic categories of an income statement and balance sheet so that employees get familiar with the terms. Then share specific financial results including revenue trends, cost of goods sold, gross profit, profitability, expenses, and pretax income.
  4. Explain how company growth works, the difference between sales and cash flow, and how the company results impact teams and individuals.
  5. Explain how compensation and promotion, employee reviews, and goals will correspond to the MSPOT framework moving forward.
  6. Make sure all new employees see this information at orientation on their first day and explain the sensitivity of this information. Define the process for asking questions and digging deeper. Explain the rules of what is discussed and clarify what is company confidential.

Transparency builds accountability. If critical information is shared, accountability becomes a more natural part of the culture. Accountability is the willingness of each person to take responsibility for their actions, including their decisions and work results. Inbound organizations trust their employees and require accountability to be successful.

In an inbound organization accountability means that everyone understands the following:

  1. I know the goals that I need to reach.
  2. I am responsible for meeting those goals.
  3. If I can't hit these goals, I should ask for help.

Asking for help is an important component of an inbound organization. Internal collaboration is more conducive to accountability than a competitive environment. High trust means that asking for help is not viewed as a sign of weakness but as a sign of strength. It is a quest for the best answers, the most advanced thinking, and the most developed expertise. In an inbound organization, asking for help is a sign that the person cares enough about the goal to seek all avenues to arrive at the best solution.

Putting People First

People First is about investing in your employees, cultivating a culture of mutual respect, and practicing empathy. Employees that connect and are fulfilled, empowered and ready to act, and aligned and in a trusting environment are better able to deliver the experience buyers expect and to build and foster the relationships that create competitive advantage. As Richard Branson puts it:

Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients. If the person who works at your company is not appreciated, they are not going to do things with a smile. By not treating employees well, companies risk losing customers over bad service.4

Cultivating a People First mindset means recruiting people with different backgrounds who will take a different approach to problem solving. Respect means that you understand that employees have different styles and work habits and that you value a diversity of ideas and opinions. Empathy means that you have an understanding of the way people feel.

So which should come first, your employees or your customers? Both actually, as they are equally important. Leaders must focus on employees so employees can focus on customers. When leaders build an organization that puts their People First, those people, in turn, are empowered to put the customer first in all decisions and interactions. People First works both for leaders working with employees and employees working with customers.

Dharmesh Shah has this to say on the key attitude change required to start building an inbound culture:

The first and most important step is to shift the organization's mindset to focus on solving for the customer. Make decisions based on what's in their interest—because what's in the customer's interest is in the organization's interest too. Ensure that everyone knows what you're solving for and build trust so that when people see things happening that are not solving for the customer, they have the freedom to speak up. This transition doesn't happen overnight, but the good news is that it doesn't have to. As you reorient the business to align with the customer, the benefits start to show up.5

When we asked Frank Auger, CIO of HubSpot, which is more important, focusing on your customers, or focusing on your employees, he said: “Do you love your wife or do you love your mother? You do both.”6

A key People First ideal is to give your employees a voice in how to run the company and a seat at the decision-making table. Katie Burke is HubSpot's chief people officer, and her title communicates loudly to everyone at HubSpot how important people are. Brian Halligan called Burke “probably HubSpot's most important employee” during his annual address at the INBOUND 2017 conference.

A chief people officer serves as the voice of the employee. This person is a senior-level executive responsible for advocating for all employees globally. They have the responsibility and authority to improve the employee experience by hiring and motivating the best employees available, and then creating an environment in which they can do their best work.

A People First environment leads to healthy employee relationships, which leads to healthy customer relationships.

Teams and Teamwork

The organizational structure that creates the best environment to be inbound is not a hierarchical command and control management structure but a group of fast-acting, cross-departmental, autonomous teams that understand the mission and vision. They create their strategies, plays, goals, and targets and then hold themselves accountable to get work done.

How do you manage these teams? You wind them up and let them go. You ask them to let you know about bottlenecks, and you expect to hear from them if they hit a wall. Some of these teams are within a division; some are cross-functional. Some may be remote; some may be in different offices throughout the world. The common thread is that they share equally in the ability to solve for the customer.

“If you give a team a compelling mission, and the autonomy to attack the mission as they see fit, and the support to accomplish this—magic happens,” says Eric Richard, VP of engineering at HubSpot.7

Inbound organizations thrive on giving employees control, allowing them to embrace an opportunity and empower individuals to take more responsibility regardless of title or experience. It means there is less emphasis on title and more emphasis on skills. It means executives might be reporting to individual contributors. It means new employees lead. It demonstrates that everyone has a voice and an obligation to contribute.

At HubSpot, there are no offices, no executive row, and any employee can schedule a meeting anytime with anyone else in the organization for any reason. Eliminating barriers to conversations has resulted in open communication; it makes people visibile to others in different roles and departments and ensures that information flows in both directions. This openness helps give people the ability to connect on a personal level.

“Organizations that are set up in a hierarchical fashion make fewer bets based on my experience at traditional companies. When I managed at a Fortune 50 company, the only thing I could do was say no. An inbound company provides autonomy to employees with guard rails and makes it safe to share information rather than hoarding information,”8 says J. D. Sherman.

Once teams are assembled, sync them up to work together. The alignment happens on several levels:

  1. Align the organization's goals with the needs of the customers.
  2. Align teams/groups/departments with the goals of the organization.
  3. Align people with the team's goals.

Andrew Quinn, HubSpot vice president and executive coach in residence, describes alignment this way: “Everything needs to align around what customers and prospects need to do to buy from you—what do we need to do to get the organization set up to help them and get them to buy?”9

At INBOUND 2017 Dharmesh Shah told the story of meeting Elon Musk and asking him for advice on growing and scaling a business.

Musk told Dharmesh that “every person in your company is a vector. Your progress is determined by the sum of all vectors.”10

A vector is a quantity having magnitude and direction. Each person in your organization is a vector pointing in a certain direction and has a level of magnitude regarding effort, skill, and influence.

Accomplishing your goals is determined by the sum of each person and team being aligned toward the same goals. Having responsibility does not make a person or team effective. They must be pointed in the right direction to be effective and contribute to reaching the organization's goals.

If people and teams are pointed in opposite directions, the net effect is zero regarding your organization's effectiveness in solving for your customers. If the marketing team is running helpful inbound campaigns that attract interested prospects, but the sales department uses old-school closing techniques, then the vectors are not aligned. The net result is an unhappy prospect and a lost opportunity.

More common is the situation where people are “sort of” aligned. If the marketing and sales team align and deliver a seamless inbound experience, but the launch or startup process is poorly planned and clunky, you may make the sale, but the customer is disappointed at the outset of the relationship.

Brad Coffey, HubSpot's chief strategy officer, puts it this way:

More often than not, the greatest source of misalignment happens when people are loyal to their team over the organization. It feels right for people to fight for their team. After all, these are the people that are closest to each other, so personal loyalty matters. Teams that struggle or are not solving for the customer tend to put their team first. People that are solving for themselves first, stand out, and it is pretty rare.11

Given the same resources and people, increasing everyone's alignment toward the team's goals will result in improvement of results. Much like focusing light through a lens, alignment results in more power for the team to make an impact on customers.

Notes

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