What You Do Is Who You Are: How to Create Your Business Culture

by Ben Horowitz

your culture is how your company makes decisions when you’re not there. It’s the set of assumptions your employees use to resolve the problems they face every day. It’s how they behave when no one is looking. If you don’t methodically set your culture, then two-thirds of it will end up being accidental, and the rest will be a mistake.

Culture is not like a mission statement; you can’t just set it up and have it last forever. There’s a saying in the military that if you see something below standard and do nothing, then you’ve set a new standard. This is also true of culture—if you see something off-culture and ignore it, you’ve created a new culture.

“Coaching, and not direction, is the first quality of leadership now. Get the barriers out of the way to let people do the things they do well.” This created a new culture, a culture of empowerment: everyone was in charge and Noyce was there to help.

Moore’s law, which holds that microchip capacity doubles every eighteen months while its price falls in half—and

“At Intel everyone—Noyce included—was expected to attend sessions on ‘the Intel Culture.’” The culture was drilled into new employees by Andy Grove (who would go on to become the company’s CEO and a famous cultural innovator).

Breakthrough ideas have traditionally been difficult to manage for two reasons: 1) innovative ideas fail far more than they succeed, and 2) innovative ideas are always controversial before they succeed. If everyone could instantly understand them, they wouldn’t be innovative.

The problem is that obviously good ideas are not truly innovative, and truly innovative ideas often look like very bad ideas when they’re introduced.

The Intel culture, by elevating the individual and giving breakthrough ideas a chance, inaugurated a better way to do business.

The samurai called their principles “virtues” rather than “values”; virtues are what you do, while values are merely what you believe.

Companies—just like gangs, armies, and nations—are large organizations that rise or fall because of the daily microbehaviors of the human beings that compose them.

To get them to be who you want, you will first need to see them for who they are.

The company’s character and ethos will be the one thing they carry with them. It will be the glue that holds them together when things go wrong. It will be their guide to the tiny, daily decisions they make that add up to a sense of genuine purpose.

who you are is how people talk about you when you’re not around.

Who you are is not the values you list on the wall. It’s not what you say at an all-hands. It’s not your marketing campaign. It’s not even what you believe. It’s what you do. What you do is who you are.

The secret to finding a breakthrough idea, as Peter Thiel says, is that you have to believe something that nobody else does.

In the 1600s, more than half of the world’s population was enslaved.

If I believe there is no tomorrow, then there can be no trust.

In any human interaction, the required amount of communication is inversely proportional to the level of trust.

When everyone wants to know “Why?” in an organization, the answer programs the culture, because it’s an answer everyone will remember.

something as seemingly simple as a dress code can change behavior, and therefore culture, not only in war but in business.

Building a great culture means adapting it to circumstances. And that often means bringing in outside leadership from the culture you need to penetrate or master.

No culture can flourish without the enthusiastic participation of its leader.

For a culture to stick, it must reflect the leader’s actual values, not just those he thinks sound inspiring. Because a leader creates culture chiefly by his actions—by example.

Integrity, honesty, and decency are long-term cultural investments. Their purpose is not to make the quarter, beat a competitor, or attract a new employee. Their purpose is to create a better place to work and to make the company a better one to do business with in the long run. This value does not come for free.

integrity

must be universal; you have to live up to them in every context.

It’s because integrity is often at odds with other goals that it must be clearly and specifically inserted into the culture.

focused on delivering great experiences to individual humans rather than an impersonal set of specs, feeds, and speeds aimed at no one in particular.

Create Shocking Rules Here are the rules for writing a rule so powerful it sets the culture for many years: It must be memorable. If people forget the rule, they forget the culture. It must raise the question “Why?” Your rule should be so bizarre and shocking that everybody who hears it is compelled to ask, “Are you serious?” Its cultural impact must be straightforward. The answer to the “Why?” must clearly explain the cultural concept. People must encounter the rule almost daily. If your incredibly memorable rule applies only to situations people face once a year, it’s irrelevant.

rules. One value, frugality, is defined as Accomplish more with less. Constraints breed resourcefulness, self-sufficiency, and invention. There are no extra points for growing head count, budget size, or fixed expenses.

“We look for every opportunity to save money so we can deliver the best products for the lowest cost.” (Amazon no longer gives everyone a door desk, as the culture has now been set—and as there are cheaper alternatives.)

Dive deep,

operate at all levels, stay connected to the details, audit frequently, and investigate more thoroughly when metrics and anecdotal evidence disagree.

To convene a meeting at Amazon, you must prepare a short written document explaining the issues to be discussed and your position on them. When the meeting begins everyone silently reads the document. Then the discussion starts, with everyone up to speed on a shared set of background information.

By requiring thoughtful action before every meeting, Amazon moves its culture in the right direction every day.

the rule was so powerful was that it stated not only what Facebook wanted, but what it would give up to get it.

How you dress, the most visible thing you do, can be the most important invisible force driving your organization’s behavior. Ovitz sums it up: “Cultures are shaped more by the invisible than the visible. They are willed.”

To sell, you had have 1) the competence—expert knowledge of the product you were selling and the process to demonstrate it (qualifying the buyer by validating their need and budget; helping define what their buying criteria are while setting traps for the competition; getting sign-off from the technical and the economic buyer at the customer, and so forth) so that you could have 2) the confidence to state your point of view, which would give you 3) the courage to have 4) the conviction not to be sold by the customer on why she wasn’t going to buy your product.

If you bring in outside leadership, it will make everyone highly uncomfortable. That’s what cultural change feels like.

Louverture knew that telling people that agriculture was a priority wouldn’t make it so. He had to do something dramatic to demonstrate that it was the highest priority—something everyone would remember. He forgave the slave owners and let them keep their land. Nothing could be clearer. Likewise, Hastings couldn’t just say that streaming was a priority; he had to demonstrate it.

actions overrode her intentions. It

The walk almost always wins. That’s how culture works.

the most important aspects of an organization’s performance—quality, design, security, fiscal discipline, customer care—are all culturally driven.

When you inevitably take an action that’s inconsistent with your culture, the best fix is to admit it, then move to overcorrect the error. The admission and the self-correction have to be public enough and vehement enough to erase the earlier decision and become the new lesson.

when you are a leader, even your accidental actions set the culture.

Walking the talk may be the most difficult skill to get right.

Take a look at Uber’s highly original cultural code, the values Kalanick laid down after he founded the company in 2009. Proud Uber employees circulated them widely: Uber Mission Celebrate Cities Meritocracy and Toe-Stepping Principled Confrontation Winning: Champion’s Mindset Let Builders Build Always Be Hustlin’ Customer Obsession Make Big, Bold Bets Make Magic Be an Owner, not a Renter Be Yourself Optimistic Leadership The Best Idea Wins Kalanick also defined eight qualities he sought in his employees: Vision Quality Obsession Innovation Fierceness Execution Scale Communication Super Pumpedness These are not run-of-the-mill values you’d pull out of a standard management book.

That’s the nature of culture. It’s not a single decision—it’s a code that manifests itself as a vast set of actions taken over time.

Cultural design is a way to program the actions of an organization,

Once you remove the requirement to follow certain rules or obey certain laws, you basically remove ethics from the culture.