Scaling a Hypergrowth Enterprise – Part 2 (Culture)

This Post is the second of a series of posts on the topic of scaling a hypergrowth enterprise. My former company, CyberRep, grew from $550,000 to over $80 million in annual revenue over a 9 year span.  In Part 1 of this series, I talked about People as the first of 5 key elements for scaling a hypergrowth company, the other four being Culture, Scalable Customers, Process, and Capital.  Today, let’s examine Culture.

CULTURE

Culture is the company’s DNA.  It’s the genetic code which governs how the business is built, how customers are acquired and services, how employees are managed and developed, what core values matter, etc.  We sought to build a culture of hypergrowth, opportunism, speed, and flexibility. This was integrated into our “Top Ten” corporate core value set and our “Four Pillars of Success” which I will discuss in future posts.

When should a Culture be established? – Whether you’re starting a new business, a division, group, or team, it’s critical that Culture be established at the very beginning. Why? Because, it’s always easier for new hires to fit into an existing culture, than to change a group’s culture once they are operating.  People hate or fear change.  It’s for this reason that so many M&A deals fail.  Buyers are unable to impose their new culture on the legacy team, so integration is never fully realized and dysfunction sets in, but that’s a topic for another day.

Hypergrowth – It may seem tautological that scaling a hypergrowth enterprise requires a culture of hypergrowth.  Well, that’s right.  Our culture was focused on our “Four Pillars of Success”:  Client Satisfaction, Profitability, Revenue Growth, and Associate Satisfaction. These pillars were interdependent, and our leadership team evangelized the focus on these objectives, including REVENUE GROWTH, on a 24/7 basis.  Our objective was to grow via new customer acquisition, but more importantly, via  our existing client base by expanding current offerings, cross-selling new services, and thrilling the heck out of our them.  Our sales team, client service team, and operations teams formally reported in on their progress on a weekly basis.  We held everyone accountable. By sending a clear, consistent and constant message of hypergrowth, the focus on revenue became a daily responsibility of EVERY associate, and it was was incorporated into our company’s DNA.

Opportunism – In order for a company to get into hypergrowth mode, it MUST be able to identify or create new opportunities. Opportunism is a highly entrepreneurial trait.  A company needs to nurture and support creativity and risk taking in order to establish an opportunistic culture.  While it is very important to focus on key objectives, you have to also keep your eyes open for those windows of opportunity that may open.  This could be something a client needs which you do not currently offer, or perhaps a great acquisition, or even a new line of business.  Keeping a pulse on client requirements, and the market as a whole is crucial.  But the key thing here for hypergrowth enterprises is to keep fostering that culture of opportunism, creativity and risk taking, and letting your smart people come up with great ideas on which you can then capitalize.

Speed and Flexibility – Speed kills.  And so does flexibility.  The big advantage of small organizations is that they are more nimble and responsive that the big guys, and therefore they can grab more market share by doing things that larger and more inflexible competitors can’t do.  And, believe me, customers do appreciate this!  It can be tempting to fall into the trap of wanting to “cookie cut” a product or service offering, and then resist customizing it to a particular client’s specifications.  If you want to create a hypergrowth business, don’t fall into this trap.  For service companies, especially, not being flexible is risky for a bunch of reasons:  client dissatisfaction, revenue loss, lost opportunities, etc.  In our experience, by jumping through hoops for clients and delivering faster and better than our larger competitors, we grew astronomically, not just with these clients, but with others who had similar needs.  Again, it’s up to leadership to create and evangelize this culture of speed and flexibility through any means possible.  So many successful and FLEXIBLE hypergrowth companies have pivoted and morphed their business models into hypergrowth mode successfully, Facebook, Apple, and even Groupon and Living Social, being examples.

Business is Darwinian, and Charles Darwin himself said that it is the “adaptable,” not the strongest or smartest, who will survive:

It is not the strongest of the species that survies, nor the most intelligent that survives.  It is the one that is most adaptable to change.” – Charles Darwin

Part 3 of this series will address “Scalable Customers” as the thrid essential ingredient in scaling a hypergrowth enterprise.

Thank you for reading.  I’d love your thoughts, so please Comment below…and please sign up for my Blog too!  (See the Signup box on the sidebar of my Home Page)

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20 thoughts on “Scaling a Hypergrowth Enterprise – Part 2 (Culture)

  1. It was awesome to see how everything moved forward from what this Culture fostered particularly from the viewpoint of the I.T. level. Looking forward to the rest of this series, Tien!

  2. Great thoughts you’ve shared here. We talk a great deal about the way culture affects the outcome of IT-related initiatives and I think any successful IT leader has to have culture in mind when assessing infrastructure, business process, dev. methodologies, – well, everything basically.

    • Thanks for the comment Dave! You are spot on re: IT delivery and customer sensitivity. It’s sorely lacking in the space…still! That’s why we made our motto “Easier, Friendlier, and More Reliable” which is really antithetical to the cultures of the vast majority of IT firms in the market. Good to see you this weekend. Let’s catch up live soon!

  3. Pingback: Scaling a Hypergrowth Enterprise – Part 3 | WINNING IDEAS (Tien Wong's Blog)

  4. I love the fact that you consciously and proactively created the culture for CyberRep before you grew. It seems to me most other companies define their culture after it has been defacto created.

    • I wish I could say we did it consciously and proactively. It was more by osmosis and absorption by our team of our leadership’s values and approach to business and commitment to clients. But it did turn out. We acquired 3 companies along the way and with 2 of them, changing the culture was not easy (West Coast firms), but after relentless repetition, we finally did get through and change the culture. Hard work for sure! Always better to get that culture set up early because people don’t like to change….Thanks for the Comment!

  5. In a nutshell, work on perfecting your craft…don’t be afraid to be the goldfish in an ocean of whales. It’s good to be one of a few who are experts.

    Great information! Lots to think about and keep you on your toes.

  6. Selection/Development/People/Culture…they all fit together and allow us (or prevent us) from achieving what we intend. Tien has created the bridge between people and culture with common themes like flexibility; let’s be sure to travel from people to culture and back again across that bridge to ensure that we enable the organization through having the right people; and position our people for success by aligning them correctly with what we want to do and how we want to do it.

    • Thanks Jeff. People and Culture are intertwined. You need People to make a Culture, and you need a Culture so People can be most effective. There’s a beauty in the holistic nature of how these concepts all fit together. Even the other concepts such as acquiring Scalable Customers, and building Process are interconnected with People and Culture. The best leaders should think of their companies as organisms, as opposed to pieces of a whole. Please keep your thoughts coming. Really appreciate it!

  7. Awesome!…..reminiscent of Delivering Happiness (great audio book).

    This may be a difficult answer via blog, so feel free to answer when we next cross paths: How did you allow for the expression of creativity from the “bottom” to the “top”? With so may employees feeling empowered, I imagine you’d have a dozen+ suggestions a day.

    On to the next post!

    • We had a suggestion process, for which we gave quarterly prizes in each location for “best suggestion,” so YES, we got many ideas for improvement. Also we had to cultivate and evangelize a culture of creativity and continual improvement. In fact, Continual Improvement and getting better was one of our top 10 core values, which al managers and leaders had to celebrate. Nothing is easy. This was very difficult, but if your team is thinking and feeling and living the culture every day, good things are bound to happen over time. Thank you for the Comment!

      • The concept of incremental, but continual improvement through an organization is the Japanese management style of Kaizen. Although, it’s said Kaizen contradicts hyper-growth, you obviously proved it doesn’t.

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