Creating a very clear mission with clear aligned values is super important for SaaS businesses hoping to scale globally.
A lack of clear values can lead to culture debt, lacking accountability, and issues with hiring, to name a few, all of which can have a detrimental impact on a business. In this article, I’ll take you through a value exercise, break down the key behaviors which can help fix the problem, important factors for scale, and round off with a final exercise designed to help with focus.
My name's Jonathan and I'm a co-founder of Think & Grow. The reason I'm writing this article is really to talk about how SaaS businesses scale globally and the importance that SaaS businesses and businesses, in general, need to put on their people.
Hopefully, by the end of this article, you'll have some homework to go away with to enable you and your peers and your business execs to focus on the real needs and the boundaries you need to set as an organization behind your values, your behaviors, your leadership, and your ability to actually hire the right person at the right time.
The importance of values
Walt Disney is a really easy example to use, and it's a brand most people recognize. Disney had an original mission that was started with cartoons and making movies because they wanted to entertain people, make people laugh, and enjoy themselves when they watch movies.
They've gone on to become a globally recognized brand with one of the largest and most recognized brands that every single one of us has been through as a child or are putting our children through.
But what they have done and one of the really interesting case studies with Disney is their ability to adapt to culture and times. They've never really drifted away from their core values, which is the point I want to bring out in this article.
The importance of setting up a very, very clear mission with clear aligned values has stood the test of time to Disney.
We like to think we're able to start re-fixing or recalibrating the alignment of values with early-stage SaaS businesses, and businesses in general, because of the importance they should really put in creating the right values from day one with the right mission and the right goals aligned to that.
The five H’s
I want to share an example of values that's more relevant to us as fast-growth tech founders, it’s an Australian company that has created the five H's and this is something the founder James and his partner are very proud of and is out there on the internet to check on.
The company’s called Cendol, they’re one of our clients here in Australia who are now growing globally across to the Americas. Cendol was very clear and very acknowledging of the fact they needed to create a process in which they could understand who they were as people, how they would act as leaders, how they would act to their customers, to their partners, and to new employees.
The five H's are pretty simple - humble, honest, happy, hungry, and I guess probably most importantly when you're talking about fast-growth tech companies is high performing.
Let's all face it, that's a pretty good set of core values, the five H's that they've aligned, to me, matches what is aspirational to any of the businesses we want to work with.
Whilst I encourage you to look at Cendol as a good case study to use in fast-growth tech, what I'd like you to do now is a task that I'd like you to take away and work with.
What I'd like you to take away from this article is thinking about realignment and crystallizing on your ‘why’, which is your vision. What are the problems that you're solving for?
Go on that customer sales map and really look at and understand your customer activity, the ways in which you're working week in week out, and making sure you're creating a journey that is happy for you, your staff, and your customers.
It's essential once this is mapped out that you document each of the decisions you've made from that sales journey and that customer journey, because it'll become your Bible of enablement for future staff that are coming on board, and that becomes really the first draft to move into sales execution.
As part of the values exercise, what I always like to do is use these questions as benchmarks to understand more about the founder themselves, or the cofounding team, and really the reason that the business exists.
Your clinical task, I suppose, is really answering those two key questions that I started with, which is one - crystallize your vision and your ‘why’:
- Are you really clear with your ‘why’?
- Has it changed?
- Does everyone in the organization really understand the ‘why’?
- Does it really inspire the people that you're around and your customers as to why they're working with you, as a leader, as a customer, or as a brand?
- What are the problems that you are trying to solve?
Your core values need to reflect your problem. The reason for this is your customers eventually and your future customers will want to understand the ‘what’ in order to understand the ‘why’, and then the ‘how’, and bringing them on that ‘how’ journey is really that funnel lead from customer engagement through to sales execution.
It's a pretty straightforward task, but one that is worth reflecting on, I'd suggest every six to 12 months as you go through an organizational pivot or growth internationally.
Using basic SaaS metrics, that's pretty much when you start, at nine months in series A, Series B. Values become more and more important.
Why establishing values is so important
What we see with SaaS companies that we work with, as they've expanded down the typical SaaS metric of scale, is if you don't set your values up right, one of the significant things and the knock-on effects that we've often come in and had to try and solve and fix as an organization is culture debt.
Culture debt from day one starts to build up. Culture debt starts when you start shortcutting any basic needs around people, that's engagement from the minute you walk in the office, to the way that you onboard people, to the way that you track their personal performance, have their annual salary reviews, and really manage them on a day to day level.
What we've got to try and avoid as businesses when we scale is creating any sort of culture debt. It can be catastrophic at a later stage of scale.
We've worked with businesses that rapidly scale over two years to 300 people and created such toxicity in the environment with a lack of clarity, communication, leadership styles, really defined around a mismatch in values, that we ended up having to break up that organization, remove a large chunk of both the leadership team, the exec structure, and a heap of the day to day staff to realign that culture, to the future growth of the organization.
One of the other pain points of having values not aligned is not having a clear set of feedback and accountability for your leaders, for their managers, and the teams beneath them.
Feedback is essential in terms of creating accountability, but putting a framework around that leadership accountability, that clear vision, that clear path for goals underneath that is essential in avoiding culture debt.
Finally, for hiring, when you are hiring, it's really essential that we learn from a very, very tiny, or small company stage the importance of getting the values component right against the skillset component.
When we talk about hiring people, we often find that people are trying to hire people that have just got SaaS experience in a particular function or particular category, perhaps in the same vertical.
One of the basic problems with just following the skill set route is that quite often we fall in love with the fact they've worked at company X, which is now a unicorn or some growth stage ahead of yours.
But actually, the fundamental way that they work, their styles, their value alignment is just mismatched with that of your organization. By actually putting in some structure around your hiring process around core role fit, core experience, and track record over the top of that, you should always consider values and the alignment of values, and the company vision and mission that you're driving towards.
Value alignment > skillset
I believe personally that values alignment really outweighs skill set at many role levels and types. That curious nature, that smart embodiment of being elastic and flexible, especially with today's conditions are really important traits that we look for.
But underneath that, we have to understand their ‘why’. We need to understand from a questioning base, really the reason that person exists, and the reason they're here to meet you today.
For me, these are the things that you really need to consider when setting about on scaling and hiring - getting your values lined up really, really quickly, or realigned in order to truly scale your teams.
If you're already scaled, and you're suffering some pain points, actually reviewing that entire cycle, because you'll quite often find that there's a mismatch around the value somewhere down the chain, as the business is growing, pivoted, as you bought a new key execs, and that often comes down to misalignment in the hiring cycle.
Perhaps it's not having enough real leadership and management skillset in the executive team to create the right accountability levels and the right frameworks for managing day to day activities.
Most commonly, it's down to the culture debt that's been created from the very start of the organization and how we've dealt with difficult situations.
Behaviors to fix the problem
There are pretty simple ways that you can start to fix this if you're an early-stage business, starting to learn what you need to do, or you're a later stage business that now needs to improve on some of those things.
The very essence of what I've just talked about comes down to behaviors. I've listed it as language, living and breathing, and focus.
To me, what I'm talking about here is the words that you use every day can be completely miscommunicated or misunderstood.
We have to be really cautious about the language that we're using for role types, for problem-solving, the way we're exercising our vision and our mission, to make sure not that the words you're using are bad words, but more actually that people understand what you mean by those words.
That's more and more apparent when you're talking about values because what we often find when we're breaking down a business is, there's a misalignment with the founders meaning on each word.
If you're speaking to different co-founders each day, and they're using the same word, but it has a different meaning to them, then we start to already see the breakdown in language and the start of culture debt.
It's really important that we have those come together moments in setting up the language for the organization, which becomes a regular language that is used internally and externally.
Living and breathing
It's really, really important that the behaviors of the founders and the executives are always aligned to those values. It's very easy to fall in love with someone or to know that your co-founder, but not address those issues when you see them clearly breaking some of those values that you've got up on the wall, or you've hired people around you that you say you believe in.
Addressing anything by a founder or executive level, when they're stepping over the line is essential to avoiding culture debt and avoiding this misalignment in accountability and creating disgruntled staff.
Along with behaviors, and along with values, it's really, really important as organizations that we have clearly defined roles, which sounds obvious, clearly defined goals, sounds obvious, outcomes, and deliverables.
One of the things we see in a lot of businesses is mismanagement around language, creating mismanagement around role responsibilities, the goals that have been set, the outcomes and the deliverables and the behaviors that then circle or that starts to really take its toll when we're two or three years in and we scale globally, and we've got remote work management, and we've got misalignment on the focus and the goals based on a lack of focus in clearly defining all of those things on a regular basis as we move through this scaling system.
Factors for scale
I want to talk about how you can learn to really focus as founders and as an organization in how you learn and adapt to scaling your organization.
For me, it is the simple things that count, that you can control, and then you must take as vital for scale.
What we see in a lot of execs at C-level and key leaders underneath is the misuse of time. Time is the only thing we can't get back. What we find is the most important thing you can do is make sure that your time is spent on the things that are gonna allow your business to scale, and that you're happy with the things that you're doing.
That leads to role.
Clearly defining what success means to you as a founder, and really working back to why you set up the business. What are the skills that made the business successful? What are the skills that are essential the founder or co-founders need to be doing?
Realigning those and articulating those clearly to everyone in the organization will help reflect on where you're using your time.
What we find is that a lot of founders are struggling to breathe with all of the extra pressure they've got through multiple roles, responsibilities and accountabilities, that sit across multiple functions up into the board, up into the investors, depending on the scale of the organization.
For us to clearly communicate what our role responsibilities are, what role we're playing in the business's vision and goals is obviously a clear case in being able to give that communication to the team.
But continuous feedback is what we're talking about here and making sure that you're bringing the organization along with you and at the pace that you're working at and you clearly communicate the decisions that you're making, both from a visionary viewpoint, but also an execution viewpoint.
Most importantly, the breaker tends to be goals and the misalignment of goals across functionalities.
Where we see misalignment often happens in sales and marketing and the push between those two divisions, but also how product and engineering in today's world selling in SaaS affect those and the ability of the best organizations to draw in engineers and product people into the sales and the marketing funnels as early as they can, as they scale is really where we're seeing great success in some of the businesses that are household names in SaaS world.
Seeing that Sastre in SaaS stock in the last few years, we've really learned from the success that the likes of Atlassian certainly had, and a number of other execs have talked about the proximity and the gaining of knowledge from engineering into sales, and vice versa to create an improved scaled SaaS business.
A final exercise
This is an exercise I've enjoyed doing with all of the SaaS companies we run workshops for globally. For us, it's really about learning to adapt to the focus that you need to build your day to day - week to week journey, making the most of the skills you've got to make the most impact on the organization, and stop becoming a blocker for your scale as a business.
Firstly, you need to create a time wheel which is in essence a pie of your role responsibilities. To give you an example, I pretty much spend 25% of my time in four areas for my organization.
- Management of the team,
- Leadership of the vision,
- The growth of the organization through partnerships, events, and speaking at events, and,
- Marketing, and actually the pure sales factor of developing the sales strategy and executing on that.
Create your own pie charts and be real with the time you're spending across a quarter. Obviously, COVID makes that potentially change a little bit. Look at what you're doing on a quarterly basis in a time wheel of 100% and then look at the role that you say you're doing.
What does your role description say versus your actual? This applies to founders execs and day to day staff. What we often find is there's a spread of activities not as clinical as the ones I've laid out here which are four, we often find founders have 10-15 things in their wheelhouse.
We know that people are doing extra activities we get that. But it's really, really challenging to allow teams to focus and allow staff to focus when founders are doing everything, that works against their strengths.
We find a lot of founders are doing less than 50% of the time on their core strengths and their core passions and 50% of their time on things that they're perhaps not the best person in the organization to do, or certainly not happy doing.
It's a fun exercise, but one that we find really valuable in terms of reflection on how you're spending your time.
Once you've completed this exercise, what I'd like you to think about as an exercise is:
- What are the things that are blocking you from doing your role that you'd like to be doing day-to-day?
- Where do you want help?
- Is it a time management issue?
- Is it a lack of process?
- Is it that as an executive, you've got a visionary founder that's firing beautiful grenades over to you, but you just don't have the time because they don't map up to the current roadmap or the current direction that the business is going in?
Really unearthing, what are those things that are blocking you from doing your job? Which is often that you've got too many activities on or you're taking on too much. You're saying yes to a lot of things that perhaps aren't aligned to OKRs are your personal goals.
If you're a founder, exec, or a key member of the team, or just in the nicest possible way 'a staff member' reading this, please have a look at the impact of you not doing your job against your KPIs and then creating the right message back to your line manager, or your exec around the knock-on effect of not doing this.
The idea of these exercises is to allow you to create a repeatable process for scale. Personally, what I find really works well as you document your journey down in life, if you're able to reflect on this doing the time wheel exercise every quarter, doing the role blocking exercise every quarter or every month to make sure that you're realigning to your personal goals and the company's or organization’s, what you'll start to create is a really good decision map.
For me, 360-degree reviews on yourself represent a really good use of your time and making sure that you're not driving off in the wrong direction. Quite often we find in fast-growth tech companies that we've become so passionate about something, we run down a rabbit hole, and that rabbit hole is really not aligned to your goals or even in some cases, your personal skill set.
Create a repeatable exercise that allows you to one reflect on your time wheel, reflect that to your role responsibilities, and then create a blocker map of what's actually stopping you from doing your job.
If you're able to go through those, for me, it's been really working on a solution that enables you personally to play to your strengths and enables you to therefore use those strengths and those goals that have set within those strengths, and that enables you to hopefully get to your personal outcome, which hopefully is a beautiful outcome in terms of how you feel about the work that you're doing, and that it aligns to the company's mission.
You're doing it through using their values, and then everybody's happy at the end of the day.
I'll finish with one last antidote that we feel we've set up our business to really help create.
We believe great things happen when you're able to put together great ideas together with clear goals and an engaged team.