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Keeping your culture as the business scales

Three guiding principles will help businesses stay true to their roots as they grow and change

It’s a challenge that all growing businesses face: as we scale and evolve, how can we stay true to our culture and the things that make us what we are?

The question is especially relevant to tech start-ups and scale-ups because, by their very nature, these organisations are set to undergo the most dramatic growth. For a more mature organisation, there isn’t a huge difference in growing from 5,000 people to 6,000. But moving from 50 to 500 – a smaller numerical increase – is in fact a massive multiplication of the business size.

It’s something I’ve experienced at first hand at Nash Squared, albeit in the context of an already-established business rather than a start-up. When I joined the business three years ago, there were 2,500 staff across the group; today, that stands at over 3,300 people. We have grown both organically and through acquisitions, We also launched and implemented a major rebrand of the Group, evolving from Harvey Nash Group to Nash Squared. It has all added up to the biggest investment in people and technology in the company’s history.

While the scale of the change differs depending on what stage of the growth curve you are at, the underlying principles and best practices remain the same.

Be guided by your purpose

The first point is that you have to stay true to your core purpose. You can’t successfully scale and grow unless you do. It’s about establishing your ‘North Star’ that will guide you on your journey: why are you in business and what is your underlying purpose? Why will people want to work for you? Why will clients and customers want to buy from you?

This purpose doesn’t change. If you lose sight of it as you grow, then there will be a disconnect and, sooner or later, a falling of your fortunes as a business.

Culture and values may evolve

The purpose and vision of the business play an intrinsic part in forming the organisational culture. However, the culture may evolve and subtly change as your business gets larger. You may have a culture of innovation and risk-taking in your early days – but the risk-taking element will almost certainly moderate somewhat as your proposition matures, your responsibility (to staff, customers, suppliers) increases, and the business becomes more established in the market. That isn’t betraying your culture – rather, it is evolving it to reflect the stage you’ve reached.

Values are hugely important. A successful business stays true to its values. But, like the culture as a whole, these aren’t static and may need reviewing over time. At Nash Squared, for example, we realised that the time had come to sharpen up our values to make sure they were still truly relevant to our evolving organisation. So we undertook a thorough collaborative exercise that involved extensive input from staff and really listening to their views. We updated our values accordingly and I then made sure that the leaders across our businesses were really taking ownership to embed them in how we work and operate. The new values weren’t radically different from the old ones – at their heart, they’re about respecting each other, listening, collaborating and being guided by the needs of our customers – but they were refreshed and more relevant to where we were. Going through the consultation created great engagement with our people and gave them a renewed stake in how we work.

Accept change as part of growth – including in your people

A theme you can probably already see emerging here is that maintaining a thriving culture as you scale is NOT about stubbornly holding on to everything that characterised your business on day one. Rather, it’s about keeping faith with your core qualities while adapting to the changes that come as you grow and become more complex. In some ways, it’s like a person. You will always be you – but you’re different as an adult to how you were as a child.

With this comes another crucial realisation for any start-up: people will leave. You won’t hold onto everyone forever and indeed you probably won’t want to. You need to get comfortable with that.

Some people love the excitement and the fire-fighting of a new start-up, the improvisation as you find your way, the problem-solving, the freedom to make decisions in the moment – but then as the business gets bigger and more process and governance inevitably starts to be introduced, it becomes a less attractive environment to them. Others just like working in a small organisation where they know every other member of staff and can figuratively ‘touch all the walls’ of the business; they feel uncomfortable as it gathers in scale.

What’s vital is to be open, honest and transparent with people about where the business is and where it’s heading. If some people feel their time is done – that’s completely normal and OK. They will have played an invaluable role in the development of the business. Thank them and part on good terms. There will be other people who want to come in and bring new skills and talents with them.

Keep a culture lens on everything

Your culture should be a key perspective onto every aspect of the business. For example, recruitment is a vital area. Make sure that your leaders, managers and HR team have a clear framework of hard and soft skills to look for (and why) so that new joiners will make a good fit. You also need to underpin your culture and values through learning and development resources that everyone can access. At Nash Squared, we created a learning portal as well as a wellbeing portal. These play a big role in keeping us all connected and part of one team.

When it comes to inorganic growth, culture should also be a major factor in any acquisition decision. Will the target business gel well with your culture and vision? If it is out of kilter, the deal may actually destroy a lot more value than it creates. Business history is littered with deals that foundered on the rocks of a cultural mismatch.

Another part of the scaling journey is investor backing and/or listing. If you attract investment such as from a private equity house, or if one PE backer sells its stake to another, this may create a new dynamic – such as a greater focus on profitability over top line revenue, for example. Becoming a listed business may have a similar effect. These can all have an impact inside the business – and mean once again that honest communication with staff is key.

Three guiding principles

Maintaining a strong culture as you grow is a complex area, since you are likely to be determined to keep some aspects unchanged while others need to evolve. My three overarching pieces of advice are:

• Keep focused on your North Star – don’t lose sight of the vision that inspired you to start the business in the first place.

• Be honest and transparent – you need to bring people with you on the journey. Communicate and engage. Be candid if anything needs to change and explain why.

• Make sure people, processes and governance are fit for purpose – these will change as the business expands. Your technology, systems and processes need to be appropriate and adequate for whatever stage you’re at. Invest in them so that people have the tools they need and they’re supporting productivity and growth.

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