Creating the Right Culture at a Startup

A study of GSB alumni showed they are far more likely to respect a manager who learns from sources outside his company than those within, said Tanya Menon, associate professor of behavioral science and moderator of a panel at the first annual Chicago GSB Alumni Entrepreneur Conference at Gleacher Center February 16. “The internal learner is seen as contributing less effort, being less creative, being less competent, and gaining less status,” Menon said. “The managers are less likely to promote this manager and would award lower bonuses to the internal learner, as opposed to the external learner.”

The culture in startup companies is little understood and not talked about enough, said Gary Conkright, ’82, founder and CEO of InformMed. “A CEO has to create a petri dish that provides the perfect environment for people to come and do their work,” Conkright said. “Environment won’t make or break a company, but it certainly will make it easier—or harder if you don’t have the right culture. The entrepreneur has the unique opportunity many CEOs never have, and that is to start with a blank slate and create whatever you want to create.”

Establishing the right culture in a company is the hardest, most undervalued thing to do, said Stephen Baird, president and CEO of Baird & Warner. It took Baird eight years to transform his family’s 155-year-old company to match his own vision after taking the reigns from his father, Baird said. “I really basically did it one person at a time,” he said. “I started out asking myself, ‘Are these good people and are they the kind of people I want working in the company?’ And if they weren’t, I changed them.” During the transformation, he twice fired the number-one producer at Baird & Warner. “They were not the right people to be building my company,” Baird said.

—Phil Rockrohr