In 2008 Adam Pisoni co-founded a company that, after 4 years, was bought for U.S. $1.2 billion and had helped hundreds of thousands of organisations become more open. I was fortunate to work with Adam and co-founder David Sacks during that time at Yammer, and gained an insight into what made the company's culture so special. Adam's now devoting his time to improving U.S. K12 (primary and secondary) education, and continues to be active as co-founder of Responsive.Org.
Matt: So Adam, to start us off, how do you define organisational culture?
Adam: With a “Z” not an “S”. Just kidding. People often talk about culture as something which can be added extrinsically to a company. As if it's separate from the work itself. I believe a companies culture is just the social manifestation of the organizational system or operating model of that company. For example, if you employ performance management systems which encourage competition, you will likely have a culture where collaboration is harder. If you have tons of rules dictating every aspect of people's jobs, you will have a culture without much trust. One thing that is often missed is the link between the organizational system, the leadership and the culture. You'd be right in thinking leadership often is the one that sets the cultural tone. For example, if leaders tend to be secretive, you'll also have issues with trust and collaboration. However, you have to remember how the leaders got there. They were promoted because they did well within the rules of the system. So if the system encouraged competition, the people who are good at being competitive will rise up the ranks and reinforce that cultural tone. In fact, it may be too simplistic to say it's merely the system. Culture is the feedback loop between the people and practices of the system. Therefore, changing culture requires creating and reinforcing new feedback loops with new practices and different (or changed) people.
Matt: Did you have much of an understanding of what organisational culture is before you co-founded Yammer? How did you learn about culture and its importance?
Adam: I did have strong feelings about culture before Yammer, but they were naive to the challenges faced by large companies. I've always had a bit of an anti-establishment chip on my shoulder. So when I started my own company in the 90s I really wanted to avoid there being an “us” vs. “them” mentality anywhere in the company, be it between management and employees or sales and engineers. We largely succeeded, but that company only got as large as 30 people. Later I went on to work at other larger companies and quickly learned how bad things can be when the mission doesn't resonate, the strategy isn't clear, and the people don't trust each other. I knew at Yammer we could do better. We also felt that a company which makes a product it claims improves culture should have a good culture. While some of our culture was because of things we did, I have to give credit to the benefits of transparency we got from using our own product for communication. It's a lot easier to trust people when you know you can see what they're doing and can contribute without friction. My biggest lesson though was really about mission. The importance of having a mission which resonates with your employees. Mistakes will be made, bad people will be hired and fired. Good people will leave. Companies are never perfect, but a strong mission can create tremendous latitude for inevitable mistakes.
Matt: When you were building and leading the company, were you particularly conscious of the impact of your actions and decisions on the culture and therefore deliberately do things differently, or did you just do what came to you naturally and the culture just happened as a result?
Adam: Some of both. We came in with some preconceived notions about culture. That we wanted people to feel empowered, have shared ownership, and feel comfortable trying and failing. We knew we valued collaboration over competition. We knew transparency would be a key to having a connected culture. But there was no guidebook that guaranteed success. So we also talked a lot about the second order effects our actions would have on our culture. It made decision making much harder, but we recognised the long term importance. We used to say, “Our job isn't just to build a great product. It's to build the company that builds great products.” That shift in focus from managing-by-directing to leading-by-enabling is not one you are taught in school. We had to iterate on how we led as much as on the product itself.
“Our Job Isn't Just To Build A Great Product. It's To Build The Company That Builds Great Products.”
Matt: What do you say to people who say it's not possible for a company to be both large (10,000+ employees) and have a great culture?
Adam: First I'd say I can understand where that sentiment comes from. Most large companies don't do the best job encouraging every employee to bring their best, authentic selves to work. Some people think this is an inevitable function of size. I tend to take a longer view. Companies as we know them today have only been around for a blink of an eye in the history of humanity. We've had large organizations of various forms for much longer. A city is an organization of sorts. I think many people are happy with the culture of the city they live in. We've had other large organizations where people were happy with the culture as well. What's different in these orgs is that they aren't trying to extract labor from you, for a cause you may not believe in, in order to disproportionately benefit a small number of people who are disconnected from you. When you think of it that way it's no wonder companies don't have great cultures. It may seem utopian, but the idea of companies which have a massively transformative mission, employees who can apply their whole potential, benefit from their labor, and feel connected to the outcomes doesn't seem impossible to me. I'm with Peter Diamandis in hoping that technology will bring greater abundance, leading to a rewriting of the rules of markets and power itself.
Matt: If you founded another company, what would you do differently to help the culture be even more amazing than your previous experiences?
Adam: Kris Gale, the former VP of Engineering of Yammer used to say, “Winning feels like losing because you win by focusing on what you're losing at so you can improve.” I feel so proud of what we all built at Yammer and what it continues to represent today. But I feel like we, along with many other companies, were only just scratching the surface of what's possible. Back in 2008 when we started Yammer, there weren't tons of examples of 21st century startups pushing each other on things like transparent salaries, self-organizing teams, early focus on diversity, etc... It's exciting to watching people like Kris Gale go start other companies where he can take what we learned at Yammer and push even further.
Matt: Could you share one of your favourite examples of something that happened that really represented the culture of Yammer?
Adam: This may seem small, but it was the first thing that always come to my mind when I think about the culture of Yammer. Yammer employed many high paid, some might argue entitled, young startup employees. But we also employed people who helped manage our facilities, stocked the food cabinets, and delivered mail. In most companies I'd worked at or seen, those two groups wouldn't mingle much, but at Yammer, they even hung out after work. Any time we had a formal OR informal company event, you'd be sure to see support people there mingling, drinking and playing with everyone else. There was something really special to me that we had created a company where people were treated equally and with respect, no matter what your job was.
Matt: If someone asked you for advice on how they could improve the culture of their organisation, what would you say?
Adam: Cultures don't change easily. As I said above, culture is really a feedback loop between practice and people. Culture is usually held in dynamic tension by that complex system and resists change. I think the keys to changing culture are:
- Communicating (transparently) FAR more than you do today about the challenges and aspirations of the org.
- Listening even more than you are communicating, remembering that you should be communicating more than before. Not just listening for the sake of listening, but really hearing what people all up and down your company are telling you.
- Finding the organizational rules, practices and systems which are impacting culture and not being afraid to change them.
- And finally, leading by example. If something feels uncomfortable for you, imagine how it feels for everyone else. You doing it first will make it easier on everyone.
Matt: Thanks Adam!
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