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July 09, 2020

Culture Transformation - SPEAKER SPOTLIGHT : Maintaining a Lean Start-up Culture while Scaling from start-up to $100million+/year in revenue

Courtesy of DonorsChoose.org's Cesar Bocanegra, below is a transcript of his speaking session on 'Maintaining a Lean Start-up Culture while Scaling from start-up to $100million+/year in revenue' to Build a Thriving Enterprise that took place at Business Transformation & Operational Excellence Summit & Industry Awards.

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Session Information:

Maintaining a Lean Start-up Culture while Scaling from start-up to $100million+/year in revenue

Learn how to embrace the "growing pains" that come with scaling an organization from start-up phase to over $100million/year in revenue. In your path to scaling, maintain a lean culture with engaged staff and high employee net promoter scores. Ensure your employees feel valued, are working towards a common goal, and are being developed, all while having fun.

Key Takeaways:

  • How to instill a culture of continuous improvement (Kaizen)
  • Fostering an environment of high employee engagement
  • Closing the feedback loop with staff ideas
  • Personalizing rewards and recognition
  • Slaying your communication challenges

Session Transcript:

Uh just to set the stage for this presentation uh this is based on 12 years of me working as a small nonprofit called donorschoose.org a non-profit that i left a month ago to join a startup in san francisco so a lot of this techniques and tools i'm going to take with me and try to implement as another startup because the nonprofit i've been working with in 12 years has grown to 160 million dollars in revenue donations.

So uh the i have been attending to other workshops and it looks like the workshops are meant for larger customers larger enterprises and some of these techniques may or may not apply to a larger company so it's really meant for start-ups smaller companies they may be implementable in smaller teams within a larger company just keep that in mind.

When you're listening to some of these techniques that hopefully you'll take away some of these things back to your workplace or if you're building a startup hopefully these techniques will help you uh we one is donut shoes.org the best non-profit to work for that's in the background over there this is um this even though they're all like the yellow team there's different members from different teams different group departments uh in this scenario they were all just part of the same team to collaborate and learn from each other so what are the goals of this 30-minute presentation i want you to take specific techniques and actions with you.

First see if you can instill a culture of continuous improvement kaizen high employee engagement how to gather staff ideas and then close with them on all the ideas recognition and rewards and here the key word is personalization customize the reward or customize the recognition and then you can have a lot of communication challenges so how do i avoid those how to preempt those challenges and we'll go through that and try to make this as interactive as possible.

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So raise your hand if you have any questions throughout the presentation all right so i'll start number one so how many have heard of this phrase do you know does anybody know who said it who coined the phrase initially yeah uh somebody in the government in the lmb in jimmy carter's administration and he did it because at the time uh he said that people were fixing things that weren't broken and not fixing things that were broken so that was the intent of this quote so what but if in our time if we had that mentality.

What would happen this is how you get to work um so i like this um there's actually another quote that i'll show later but so how do we get to instill a culture of continuous improvement of kaizen especially in a small company in the startup environment and i think it all begins with leadership the ceo or the executive team member of a team has to embrace this philosophy of continuous improvement of kaizen and if you don't have that it's really tough.

It's almost like facing uphill battle so if you're doing a startup or you join the startup you need to get the founder the ceo involved and on board with creating a culture of continuous improvement onboarding onboarding is super critical when you want more than the employee you tell them about continuous improvement and guess what their first assignment as a new employee is to tell you tell back what are the things that could be improved on the onboarding process.

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You do that and you give them a week to write down their notes and provide from their own experience what could be improved on the onboarding experience does that make sense ongoing training reinforcing that philosophy and then this is key because if you you've heard the phrase you get what you'll measure if you don't measure in employees performances the adding performance reviews mid-year performance reviews or even just goals kpis.

If there's not a single kpi or goal or objective that focuses on continuous improvement they're not going to worry about continuous improvement so you have to have at least one metric that says what did you improve in the last three months six months a year and it ties to performance reviews it ties to compensation it ties to rewards and recognition now everything can be improved right lane broke don't fix it we don't agree with that but everything can be improved.

Then everybody's going to try to improve everything what is more important for the business prioritize that and improve on that so you have to instill not just the culture of continuous improvement but a smart continuous improvement what should we improve first and then finally discipline discipline to achieve all the things i just i just mentioned and not only achieve them but keep them going have you heard this phrase i like this one better.

So if you haven't heard it you don't know who said it bill gates all right so that's number one i'm going fairly quick because we only have 30 minutes number two how to foster an environment of high employee engagement so this is more on the social side on the side where like you want people to feel like themselves feel like they can bring themselves to work and bring the best of themselves and they're engaged they're happy they feel like they can speak their mind.

So how many people have raise your hand if your office is like the one on your left raise your hand if it's your office more like the one on the right yeah which one do you think foster some more communication there's also some negatives around that one right i mean a lot of literature went from this is the best of all worlds to like uh actually not so much right yes right there's a reason.

I started people so we started off with with something like this then we went like this at donorschoose.org and the pendulum swung very very much to the other side we had to approve a budget of 100 per person for them to get headphones and everybody would get their own headphones and next you know it's like people's one they wouldn't talk to each other but also uh there was physical uh distractions right that the sound is one thing but the view was something else.

So we actually expanded to a second floor and created a library where people can go in there and focus on the work so half of the time or an hour or two hours a day and it's like the right balance so the thing is like finding the right balance for your organization what works what doesn't work.

You don't want all your offices to look like that you want a little bit of a of a balance between an open layout where there is collaboration conversations happening but also a space where people can focus and get lost in their work and get stuff done that makes sense okay.

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So we've done social events volunteering and celebrations holiday parties every every holiday that fosters engagement and just team building volunteering is huge so you definitely have to start introducing like volunteer new york care stay that's in new york city or just have like one day of volunteering where everybody gets to go in and partner and volunteer and celebrate those milestones make sure that you take time and effort to celebrate those muscles they mean a lot to the staff when you do that we have what's called an all-staff retreat.

My second slide had the picture of an all-staff retreat where we went out and did a bunch of games but it's also a time where you get outside of your day-to-day uh work and it's once a year you bring everybody to an off site where you focus on what's ahead of the year what's the planning what's going to happen get everybody aligned on what's going to happen for the whole year.

That'll foster engagement that'll foster people getting happy about like communicating what they want when they want to talk about and like any ideas they might have core values a lot of people most companies have them it's how you how you actually display them in the office how do you actually live them what exactly how you reinforce them and the one thing.

I would say is add them to the performance reviews add the core values to your performance reviews and say of all these core values which ones you exhibited best which ones you struggled with the most why and why not and nobody has to get 100 of all the core values right it's almost impossible but you need to have what are you good at which core values are you good at which ones you need helps with help on and that just reinforces the idea that these are what the core values that we stand as a company as an organization and then nowadays.

Our company average age is about 28 and flexibility is the number one reason why people love working at donorschoose.org and if you don't have work at home work from home or a doctor's appointment you don't have to like tell everybody and get permission from anybody just have the flexibility for people to like do things in their personal lives so that they're not stuck in a job.

Where they have to clock in and clock out that is huge especially with the new generation of employees they value flexibility a lot by the way i failed to mention that my colleague erica vendetti is sitting in the front row so she has to leave early because she has a flight but she might help me with anything that i uh and she's now the representative donorschoose.org.

Since i'm leaving uh and she also has she brought in some gift cards for all of you uh this is for you to donate to a project so at the end don't leave without picking a gift card or to donate to a project okay uh that's number two number three how do you gather once you have a high employee engagement they're gonna be full of ideas they're gonna be like we should change.

This we should change that we should like do this better how do you get them to a give you those ideas and then b make sure that they feel like they they're being heard the one first thing i would tell you is like whatever you come up with make sure it's easy to use don't come up with a template that requires manager and ceo approval before you submit it just it just won't happen make it as easy as like ideas at your company send it there no subject line just like throw your id that's like the simplest easiest thing to do there's a lot of drawbacks to that but first you just want people to like start submitting things right you can improve the process later you just first you want adoption people to adopt the idea of this is a new process.

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People want to hear from me submit ideas the next thing yes was there a question no the next thing is make sure that whatever you develop is transparent to everybody now with email it's a little bit tough but if that email address is a distribution list that goes to everybody in the company.

Then everybody will get the idea now there's some drawbacks of that we found out about the struggle because then people start hitting reply to with like the word yes okay great thank you i know you like that but you know what there's a lot of people that you say okay reply all hey i like this idea and what if we add this to it to make it even better and that just made it create a culture of collaboration and making things even better we actually moved from email to slack uh raise your hand you use slack slack is a lot easier because you can thread conversations.

So you have somebody post an idea and then if you just have to say yay you put a thumbs up emoji if you have to add to the idea then you thread on the idea and it just feels more collaborative and it's not as distracting as getting a hundred emails on the same thing yet set the right expectation we got to a point where we were saving about five ideas a day uh and there was no way we could close the loop with every single idea so you have to cl you have to set expectations as to which ideas are going to be seen which in our case was all of them which ones are going to be worked on which is not all of them and which ones were going to be deprioritized or postponed to a future date.

Which ones were you going to close the loop and which ones you were not and and that's important because then people at least know whether um what to expect whether it should expect an answer on their idea or not and what we ended up doing is the the ideas that had the most thumbs up or had the the most value to it that perceived by the staff the wisdom of the crowd the wisdom of the staff those were the ideas they got prioritized in fact this is back when we had uh email this idea was in 2012. i know it's a little bit hard to read but this uml in 2012 said.

What if we had a promo code that we can give teachers for their first project that was only eligible the promo code is like a match donations for the first seven days that idea got so many likes got so many replies that we decided to implement it within three months got implemented and it's still to this day the number one driver of new donors to our business this is just one email that was sent by now seven years later it's still the number one generator of new donors.

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This other idea from james walter doyle in 2015 he was working with districts administrators school district administrators he said you know district commissioners want to know the impact at the district level right now we only provide nationwide or by state well that idea resulted in us having look a looker a report that sends that drills down by zip code or by district and now district administrators get those reports proactively or reactively as they need to and that's still in function today the administrators are like i want to know what's happening in my school how many teachers are asking for resources and this report does it all because of james walter don't submit this as an idea.

All right my favorite number four personalized recognition and awards if you're not personalizing your recognition or rewards you're not getting the full effect of your money of your investments right if you're giving 25 starbucks cards or 100 visa cards.

That's not personalized enough okay so first you need to understand like the employee who's being recognized do they prefer public recognition or private recognition that'll dictate whether you get something you do something that's out on all hands and recognize the person for whatever they did a big project they did or or they completed a milestone in their career or if you have to do it privately either way you have to do recognition and rewards you have to personalize reward.

I'll give you an example so this is a staff member office manager and she had just joined the organization lucy rose was somebody who is fairly private uh i would say that within two years of working with her i did not know much about her and i worked with her a lot and she worked on the new floor that was going to be open she worked tirelessly hours and weekends to get this new floor open and in my mind i had to find a good record a good reward for her and i didn't know what to do i didn't know what to get to get her so i did research.

I went to her best friend what does she like what she doesn't and there was like very little nformation and then i went to her meet the team page bio and i saw this last thing in the bottom who knows who knows who yo-yo ma is right so it's almost everybody right uh cellist chinese american telus in high demand i googled him i decided to buy tickets for her and a significant other to so for her to go to a young concert sold out at the lincoln center.

Just sold out even two months ahead of schedule sold out you all know this went to the secondary market 300 400 each ticket and i'm like my budget is 200 i can't i can't do this with and eventually i saw two tickets that were 250 each i could probably go a little bit over budget um and i was about to buy them and i saw a little asterisk that said these tickets these seats have an obstruction that's just going to come across as me being cheap and then i remember that.

I had somebody who a friend who worked at the at lincoln center so i messaged i messaged her and i said this is not these are not for me they're for somebody a co-worker and she hooked me up and she's like just don't mention my name just don't tell anybody because i don't want anybody to know but uh she got the 95 face value and they were great tickets amazing tickets uh lucy rose cried and she brought her best friend from dc to the concert and it was like a night.

She probably won't forget uh and then i had extra money to like give her like gift certificates to go have dinner before the concert or after the concert so just going a little bit above and beyond will make your money go way further and this is something that was very impressionable for her it was something that was impactful to her it was something that was personal and she felt valued and it was fun for me to do and i can tell you a lot other stories uh etsy is one of my favorite places to buy customized personalized stuff so if you haven't bought an etsy.

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It's i don't i don't get paid to say this but i like that scene one of our ig directors he once helped also with the move office move and i got him some cufflinks that had um that were personalized monitoring so i had his initials and he liked him he's like oh my god this is awesome they had my initials and i said look open the cufflinks and they were usb drives and as a nike director.

It's like this is amazing this is the coolest thing ever and i was like i thought you would like that okay um the there's also something uh a software called you earned it how many of you have heard of you earned it okay this is uh there's um this is peer-to-peer recognition that goes a long way very long way when you have peers recognizing you in a public forum in this case candy is recognizing muhammad for merging some demographic data and muhammad is a mediated scientist that we hired recently.

You can also select which core value they exhibited in this recognition in this case it was teamwork so this is another way you can write reinforce your core values this has been a huge success we actually integrated with slack so you could recognize people via slack on you earned it and you get points and then you can redeem the points for these gift cards so you can donate to to school so it's just like a cool full cycle so whatever you do with you earned it it could be points to redeem for uh swag or recognition or rewards or whatever you want.

It to be a day off you can do this with keyword but also i'm not getting paid to say that but i do like that software okay the last one slight communication challenges um as you continue to grow in a startup you will notice that departments start getting siloed and you'll notice that projects that used to go flawlessly start breaking down or start being more challenging.

Than they used to before and a lot of that has to do with communication people are just not communicating with each other or miscommunicating or not setting the right expectations and that's something that happens even in bigger topics of course but it happens because usually because there's no roles or responsibilities established ahead of a project and the one thing that we recently implemented was cross-team collaboration so anytime there's a big project that is greater than a million dollars and involves two or three teams or it affects x number of donors or some teachers we get representatives from every team in the same conference room to talk about this.

There's an owner that owns the agenda and talks about what the project is and how to move forward and how it affects every single team so we did not have these in the past we started having them about two three years ago and they've been amazing for project-based work we also have we developed this framework called mochi.

It's sort of a combination of the rossi mocha network frameworks that are out there the reason why we liked we had to adapt these framework is because i can't believe it's going to do that one by one i am just going to do all of them because you can read faster than i can speak but this this framework what it does it assigns a role to every person involved in the project and it makes it clear.

There's one owner that owner is responsible for this project getting done and every single time we have a new project at the very top of the project the very thing you have in the in the document of the project of the project plan is who's the manager who's the owner who's going to approve this project once it's done who's being consulted which teams or which people.

Who are going to help you and who just needs to be informed and this one of the reasons why we did this is because as a company that values transparency we had a lot of people in the organization that wanted to help and wanted to be consulted you're like well this project doesn't really affect you as much you're actually in the ah you need to be informed i'm okay with that but and to make it clear as to who's going to be consulted and who's not and it was tough for some people.

Who thought that you know they need to be consulted for everything and you know for at least some of these projects you're not going to be consulted you're just going to be informed but you have to be clear about the roles and responsibilities of each person and this has helped us a lot with projects and getting them forward and since being successful.

I'll tag him for informed real quick and just say that like i think it also goes back to that idea creation like some people are just particularly passionate about like knowing what's happening and like continuing to be able to implement new ideas so having a space where anyone was sort of welcome to be a part of a project was also really important to our org culture.

So like even if you're a part-time uh team member you could jump in on the informed row and just like get updates and sort of like be in the know which which really goes a long way for staff engagement okay so uh five minutes questions yes um so we've got an in-house agency and uh so we have designers developers and like more general like accounts teams.

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I was curious if you've encountered and how you mitigate um in terms of cultural events and stuff kind of having the team almost be like act ungrateful or like spoiled at times like how you deal with that because i just accept it yes it's a tough problem uh that's getting bigger and bigger we we started with uh giving the staff free coffee and then we went to stacks yeah and then they wanted particular kind of snacks and then and it it just like grows involved the law has evolved and now it it almost comes across as entitlement like they feel entitled.

I actually had conversations with many people about this first you have to do user user interviews like you know tell me more about how you feel about this perk and why do you think t's important to you how important is it to you what i what i found out is that people actually just want to know what's available and what's not first of all and and what we ended up doing we said you know what we're going to come up with a budget and have staff decide how to spend that budget and it's tougher when you don't have a culture where you're like empowering people but if you can create the guardrails of like what is it that you can get and what is it that what is it that you're not gonna get uh and just say anything in between these guardrails you have a thousand dollars a month.

What do you want to do with it and these are things you cannot do with it i just had a team say that can we take my team for axe throwing has anybody heard about accident any craze and my initial gun was like no of course not we were going to do that too and we have to check with hr.

Yeah and eventually i was like you know what? how many ? how many ? accidents have they had in the last year yeah i was like they're like oh just won because it was like beer alcohol um at the end of the day we decided to take the risk and they went and they had tons of fun um but is that creating a culture of like the next team being like well if they went yeah we should go too we haven't solved that problem to be camping with you it's tough i think guardrails is the way we're going to try to see if it can fit fix that problem but we're not we're not there yet yeah and i'm.

So i'm within a hospital system and so we also can't like have the enterprise looking at us be like where are these guys doing like constantly doing fun stuff maybe we should give them a smaller budget next year yes okay ray did you have a question uh so your next startup is it for profit my next startup is actually a for-profit uh artificial intelligence machine learning uh do something i already started applying some of them and they worked really well yeah okay uh maybe it has some time for one more question and then you can get a gift card or not and i'm gonna be here so if you have a private question thank you so much.

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About the Author

more (17)Cesar Bocanegra,
NYU Adjunct Professor and Former COO,
DonorsChoose.org.

César and his team vet tens of thousands of projects per month, and then facilitate the purchase and delivery of materials to classrooms across the country. In addition to office management and several IT functions, César also manages the organization's human capital, customer relations, finance, and donor appreciation efforts. As Chief Operating Officer at DonorsChoose.org, César is responsible for leading the operations, finance, and HR teams and ensuring the operations’ workflow is fully scalable. In less than seven months, he was able to scale the organization from supporting 10,000 public schools to over 100,000 public schools while at the same time increasing customer satisfaction with a minimal increase in budget. César has significant experience building team structures, tools, systems, and processes that ensure the organization is scalable.

Prior to joining DonorsChoose.org, he spent 11 years with AT&T in various capacities, including Sales, Finance, Legal, and Vendor Management.

César earned his mechanical engineering degrees from Caltech (B.S.) and MIT (M.S.) and holds an MBA in Strategic Management from the Wharton School of Business. César was also an Adjunct Assistant Professor at New York University (NYU), where he taught Social Entrepreneurship.

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View our schedule of industry leading free to attend virtual conferences. Each a premier gathering of industry thought leaders and experts sharing key solutions to current challenges.

Watch On-Demand Recordings For Free

Watch On-Demand Recording - Access all sessions from progressive thought leaders free of charge from our industry leading virtual conferences.
 

Best-In-Class Training

Delivered by the industry's most progressive thought leaders from the world's top brands.
Start learning today!
 

Proqis Digital Virtual Conference Series

View our schedule of industry leading free to attend virtual conferences. Each a premier gathering of industry thought leaders and experts sharing key solutions to current challenges.

Watch On-Demand Recordings For Free

Watch On-Demand Recording - Access all sessions from progressive thought leaders free of charge from our industry leading virtual conferences.
 

Best-In-Class Training

Delivered by the industry's most progressive thought leaders from the world's top brands.
Start learning today!