How do you build a great culture? It’s worth it to create a culture of unconditional love that perpetuates itself and binds your team together into a whole much bigger than the sum of its parts. -By Philippe Mora (@philippemora)

San Francisco, 02/28/14 - In a way, it is not really about creating a culture of unconditional love that matters - it's about being about to maintain the culture as the organization grows, and to find the correct structure that will effectively and at the speed of light will identify and weed out the individuals who will compromise and negatively affect the culture. Those types will irrevocably show up at one point. Holacracy and Zappos believes that the solution lies in the hiring, and firing process - as well as going into a flat organizational structure (which is in fact a rehash of the typical matrix pioneered in the 50s by Gore Technologies). I suggest in my "hollywood" model a radical approach that involves changing organizational structures to a per-project basis. 

During my first decade working in the Buenos Aires office of Egon Zehnder in the late 1990s, our Argentine executive search practice soared, recording the highest per capita financial performance in the whole firm for five consecutive years. But we all know what happened in 2001. By the end of the year, Argentina’s economy had collapsed.  It was the largest sovereign debt default in world history, and GDP fell by some 30% coupled with a 300% currency devaluation. Over 12 days, five different presidents took control of the country.  One bank lost more money in a few weeks than it had accumulated over the previous century.  There were companies with losses larger than their sales, and one month the number of new cars sold in the country was lower than the number of cars stolen!  As you can imagine, that was not an easy time for me.  No one in their right mind was looking to hire a search consultant.

As that dramatic disintegration played out in early 2002, I had to present our office’s results and perspectives at the firm’s annual partners’ meeting in Switzerland.  As soon I walked on stage, the audience of some 200 of colleagues went dead silent, waiting to hear what I would say. I was solemn and candid. I told them that our brilliant past in Argentina would never be replicated; that I was expecting big losses and didn’t see much future for our firm in the country. I said I would wait a year or so and then tell them very frankly whether it made any sense to stay.

As soon as I finished, one of our Dutch partners, Sikko Onnes, stood up and said: “Claudio, if I understand what you are implying, you are totally wrong.  Our partnership has benefited from the extraordinary contribution of your office for well over a decade.  Now it’s the time for us to support you.  Your only job is to go back to the Buenos Aires office and tell every single member of the consulting and support staff that they all have our full and unconditional support.”

The whole group then stood up and applauded.  I tried to thank Sikko, but I couldn’t because I was in tears. What I felt then, from my colleagues, was unconditional love.

Thanks to Egon Zehnder’s corporate culture, it’s something I get at work every single day, and it’s what encourages me to give my absolute best in return, now for 28 years.  Any firm that wants to not only hire the best talent but also pull them together into strong and lasting teams can’t do so without fostering a compelling and inspiring culture.  That’s how you overcome challenges, and keep your mission going in your absence.

All serious research, all respected business thinkers, and all great leaders confirm this point. As Peter Drucker put it, “culture eats strategy over breakfast”.  Just take a look at Southwest Airlines, the company which saw the greatest value expansion in the S&P 500 between 1971 and 2001.  Herb Kelleher — its CEO for 35 years — once said: “Given enough time and money, your competitors can duplicate almost everything you’ve got working for you. They can hire away some of your best people. They can reverse-engineer your processes. The only thing they can’t duplicate is your culture… Do you know the difference between strategy and culture? Well, when Napoleon was in Paris in a room with all his generals around a table, discussing how to attack Russia, that’s strategy. But what makes a million men march to Moscow, that is culture!”

Of course you still need to hire outstanding performers with great potential; appoint them to the right roles; identify, retain, motivate and develop your brightest stars; and build great teams fit for the purpose. But you can’t make the mistake of ignoring culture. If you do, you’ll achieve very little, and it won’t last long.   Your people won’t go as far as they could, or they will leave.

So, how do you build a great culture?  It starts with you, the leader, using it as a filter for hiring.  My model is Egon Zehnder himself, who founded our firm and gave it his name. From the beginning, he vowed to consider only the strongest candidates to join him:  people with double degrees from top schools, international experience, high emotional intelligence, and remarkable career trajectories.  More important, he would never, ever, hire anyone who was not dying to work in a highly professional, ethical, collaborative firm.  Before I joined, I was interviewed by some 35 partners, including all executive committee members, in five different countries, over a single week.  Egon personally checked my references with McKinsey, my employer then.  That’s the standard process, and it remains intact today.  Until he retired as CEO, Egon met with and approved every single consultant who joined any of our 68 offices around the world – for 36 years. Today, his successor, Damien O’Brien, continues the practice, no exceptions allowed.

The second step in building a culture is compassionate coaching.  Once we’re adults, our personal growth comes mostly from exposure to the complex challenges discussed in the previous section and from great developmental relationships – with bosses, mentors and colleagues who engage us, motivate us, inspire us, and help us succeed.  Great leaders are great listeners, who make their employees feel valued, see the bigger picture and feel a part of something important.  Fascinating recent studies using fMRI (functional magnetic resonance imaging) to track neural activity show how  that sort of coaching arouses the parasympathetic nervous system, invoking cognitive, emotional, perceptual and behavioral openness and improving performance.  It also creates the conditions for neurogenesis, allowing people to learn and develop new healthy habits and competencies.  By contrast, coaching that focuses on weaknesses arouses the sympathetic nervous system and does just the opposite.  Compassionate coaches are not just positive cheerleaders but also committed guides, conscious of the state and progress of their team and the individuals in it. They are also timely provocateurs, offering the right dose of tough love when necessary.

These hiring and coaching practices demand extraordinary discipline.  But it’s worth it to create a culture of unconditional love that perpetuates itself and binds your team together into a whole much bigger than the sum of its parts.

[Read More Here > Thank You HBR 01.08.14]

You need to develop the awareness and adaptability to notice, appreciate, and exploit opportunities to enjoy career success in all its different forms, even if the most explicit, generic forms of recognition aren’t currently available. With practice and attention, you can reap your own harvest from a wide variety of work experiences, and as a result, enjoy a richer and more satisfying career. -By Philippe Mora

[Thank You HBR | By Monique Valcour 02.18.14]
As a manager, how can you cultivate a sense of career growth and development for your people, even when possibilities for promotion are limited or nonexistent? I posed this question to my human resource management students recently. (The context was that we’d just been considering some evidence that “Gen Y” employees are likely to head for the doors if they don’t see short-term prospects for career advancement.) While my students generated several promising ideas, some advocated an approach that dismayed me: Companies should increase the layers of management, they argued, to provide for more frequent promotions.

Of course I understood why they might think so, but this was a “be careful what you wish for” moment. Anyone old enough to have worked in the many-layered organizational structure of the past knows its shortcomings.

But what bothered me most about their idea was the reminder of how many of us feel lost without external signposts to mark our success.  Particularly for young people, it is a tough transition to leave the familiar and clear markers of school success behind and learn to thrive on the more ambiguous ones that mark a lifetime of employment.  Crafting a truly successful career demands a high level of self-awareness and ability to self-direct, capacities that schools and universities don’t always do a great job of developing. 

As an example, let me introduce you to Sam.  Sam grew up in a close-knit family in a US community with excellent schools.  His father is a sales manager, his mother a pediatrician. Always a top student, Sam did well as an accounting major in the honors program of his state’s excellent flagship public university, graduated and took a job with a financial services firm. That is where his story took a more somber turn.  He struggled with the work and found the corporate culture alienating. Used to outperforming his peers, Sam was shocked at his first performance review when his boss informed him that his performance ratings were unacceptably low. He had six months to improve.

The success of Nest’s digital thermostats are helping turn up the heat on venture capitalists to fund hardware startups. Google’s $3.2 billion purchase of Nest, GoPro’s pending initial public offering and Jawbone’s budding popularity have VegasTechFund’s Jen McCabe giddy about the prospect for hardware startups. This will probably come after the #techbubble 2.0 has burst, as it takes more smarts and skill to understand and get hardware+firmware technology off the ground than posing with a macbook air at Starbucks in the market district of San Francisco. Thankfully, Machine to Machine and digital health will emerge as the strong drivers of this post-Apptepreneur, post-e-la-carte world, where reality does not defy gravity and Silicon Valley is back in the South Bay. -By Philippe Mora.

[Thank You Bloomberg | By Ari Levy 02.11.14]
McCabe has backed about a dozen hardware companies in the eight months since she joined VegasTechFund, the venture investment group started by Zappos founder Tony Hsieh. She’s looked at 400 to 500 others. After an extended stretch when many investors steered clear of hardware because of the excessive costs and risks involved, high-profile acquisitions and IPOs are starting to bring back the enthusiasm.

“Entrepreneurs will be reading a lot of buzz about hardware and starting hardware companies because there’s a viable exit strategy,” said McCabe, 34, who previously worked at robot startup Romotive.

Several of McCabe’s initial investments, including health device maker Scanadu, were companies whose products she first backed out of her own pocket through crowdfunding sitesKickstarter or Indiegogo. Crowdfunding has helped spawn numerous hardware companies by letting them take pre-orders to fund development and test the market.

After that, entrepreneurs have had to turn to a short list of venture capitalists who have shown an appetite for hardware, such as Khosla Ventures or VegasTechFund. That pool could grow thanks to the recent high-profile success stories.

In addition to investing up to $200,000 in each deal, McCabe brings expertise. She spent about six months in Shenzhen while working at Romotive, gaining a firsthand look at production lines and manufacturing. She’s helping startups to navigate the challenging world of distribution, and hopefully avoid common and costly mistakes.

For example, the large cartons that companies use for shipping must weigh no more than 35 pounds or else they result in an extra charge for the use of a forklift, McCabe said. That’s something many hardware entrepreneurs learn the hard way.

[Read More: http://go.bloomberg.com/tech-deals/2014-02-11-nest-and-gopro-could-lead-to-a-hardware-startup-revival/]