Patterns and anti-patterns in company values

Company values can be exceedingly valuable, or they can be beyond worthless.

You’ve probably rolled your eyes at company values at some point. Every time I see a list like “quality, integrity, and respect,” I suspect that the company hired a management consultant to come up with a list, or just Googled company values. (Note: don’t do either of those.)

Every company has values, though, whether they’re stated or not. Values are important because culture is high-leverage. If you’re a startup founder or company leader, the values you set - intentionally or accidentally, good or bad - affect the way people will act for years. So it pays to be thoughtful about values.

Poster: Move fast and break things

Facebook had a good list of values from its early days. Or maybe: Facebook had an effective list of values. Values would go on posters on the wall: “Move fast and break things.” “Fortune favors the bold.” “Always be open.” These values fueled Facebook’s meteoric rise, and also fed some of their current challenges.

Amazon has 14 (!) “Leadership Principles.” I’ve known quite a few Amazon employees over the years; roughly half loved Amazon, and half hated Amazon. But even the Amazon detractors had good things to say about the Leadership Principles - they are used effectively to encourage a particular culture. The principles describe what is both good and bad about Amazon culture: roughly 10 of the 14 encourage high standards (and high pressure), and 0 of the 14 encourage empathy and work/life balance.

Values are important because they help define culture, and culture is one of the most important parts of any organization. Culture is like the rules or operating system of an organization—give a set of inputs, what does an individual or team do? How do you encourage consistent behavior across a team as it scales? How do you create a set of default responses, rather than requiring everyone to make every decision from scratch every time?

At Mux, we started thinking about values from the very beginning. We got our start in a rental home down the peninsula from San Francisco, eating ramen and working 80 hours a week during Y Combinator. At night, we'd decompress in a half-broken 1970s hot tub out back that only stayed warm if we briefly ran the jets every 30 minutes (true story), and talk big picture about the kind of company we were trying to build.

Values were a common half-broken-hot-tub topic. Our earlier company, Zencoder, didn't have an explicit list of values, but we still had clear implicit values: developers first, impressive customer support, and work/life balance. We knew we wanted to continue some of these values at Mux, but we also wanted to do something new and think beyond what we did at Zencoder.

Our first formal values conversation came probably nine months after the company started, but we had already laid most of the groundwork at that point. So when the founders sat down at a whiteboard to create a list, we got pretty close in about 30 minutes.

Here are the six Mux values.

Be human. We are humans first and believe there is more to life than just work. Have empathy. Bring yourself to work. It's OK to have personality.

Care obsessively. Own your work. No bad frames. Do good work because you care, not because someone made you.

Do a lot with a little. We need to out-compete 10x-100x larger teams to succeed, so we always have to look for opportunities to do more with less and turn hard problems into easy problems.

Communicate clearly and directly. Take the time to write and speak well. Be honest and challenge directly, while also caring personally. Clear communication enables clear thought.

Turn customers into fans. We succeed if our customers succeed. Look for opportunities to delight users. Everyone should spend time with customers.

Bias for action. Ship. For a certain range of problems, done is better than perfect. If a decision is reversible and non-critical, act at 70% information and confidence; you’ll never do anything if you wait for 100%.

We added this last value a few months ago. Values can change - we went from 6 to 5 in our first year, combining two similar values ("Do a lot with a little" and "Turn hard problems into easy problems"). Changing values isn't easy, though. If you want to create (or update or delete) a value after you've been going for a few years, it probably needs to be something that is already there implicitly. As the old cliche goes: culture is like cement—once it hardens, it’s not easy to change.

We use these values in a number of ways.

  • When making decisions, we try to bring values into the conversation. Push for a feature that will help “turn customers into fans.” Encourage “bias for action” when a quick decision is valuable. “Be human” when considering health insurance plans or parental leave policies. Invest in design as a way to “care obsessively.”

  • We use them in formal (and informal) reviews. Managers use this language when praising and criticizing performance - “You clearly cared obsessively in this situation” or “You may have over-thought things; see if you can apply more bias for action next time.”

  • Any Mux employee can “shout out” another Mux Employee, which gets them a $50 gift card and a slide in our weekly company meeting. These “shout outs” include the company value that is being praised.

  • If two people can’t agree on something important, we will ask how company values affect the decision.

So, what makes good values? In my experience, good values have four characteristics.

  1. Good values are simultaneously authentic and also aspirational. If you’re a slow-moving organization, don't choose "move fast and break things.” If your company is political and backstabby, “Be human” probably isn’t authentic. At the same time, values should describe where you want to go, and not just where you are today. We added “Bias for action” as a value this year because that’s something we want to embody more.
  2. Good values are opinionated. This is the problem with “quality, integrity, and respect” - 80% of organizations at least pay lip service to these kinds of things, so they don’t really tell you anything. If you can’t make a credible case for the opposite of a value, it’s probably not a good value. (For example, while Mux wants to “Turn customers into fans,” there are companies who would rather do the absolute minimum they can to get a customer's money, and that may be a rational choice.)
  3. Good values are memorable. To be real, employees need to know and use company values. If you and your team can’t list most values off-hand, you need to invest in some Facebook-style posters (or do something more significant).
  4. Good values are contrasting with each other. Contrast is important because important decisions are complex, and complex decisions often bring competing values into conflict. “Be human” and “Communicate directly” can conflict when you need to put someone on a performance improvement plan. “Care obsessively” and “Do a lot with a little” contrast when deciding how much time to invest on something. If your values don’t contrast (“quality, integrity, and respect”), they probably don’t address the range of situations you actually encounter.

If you’re a startup, go find a broken hot tub and think through the values you want to see at your company. Then write them down and talk about them. Go over them during employee onboarding; hang them on the wall; talk about them in All Hands meetings. It really doesn’t take that much time, and the right investment now can have an enormous impact as you grow.