Dan Martell - How To Tell If You Have a Toxic Culture in Your Startup

00:00:00.000 What's up everybody?

00:00:01.200 Dan Martell here, Serial Entrepreneur Investor and

00:00:03.700 Shotgun Nerf Shooter, bam!

00:00:06.500 Anyways, creator of SaaS Academy, in this video I'm going to

00:00:10.340 walk you through how to identify if you have a toxic culture

00:00:13.940 in your business and be sure to stay at the end where I share,

00:00:18.120 just don't put that down, a framework called the Weekly Sync

00:00:21.120 that allow you to get clear with your team to make sure that

00:00:23.920 they're working on the right things and everybody is on the

00:00:26.800 same page from a communication point of view which will

00:00:28.760 hopefully solve your toxic culture problem.

00:00:44.400 So I've had the privilege of seeing world-class companies,

00:00:48.220 Pixar, Google, Airbnb, the culture these companies have

00:00:51.820 created, Netflix in San Francisco when I lived there,

00:00:54.960 to the opposite of when I was building my company sphere,

00:00:57.780 these government agencies and big fortune 500 companies

00:01:02.620 that were just, you know, people would live

00:01:04.260 in like cubicle farms, okay?

00:01:06.020 Two different worlds but what I've learned over the years

00:01:08.600 is there's characteristics of the team and the company

00:01:12.600 that will tell you if you have a toxic culture

00:01:14.500 and that's what I wanna share with you guys today

00:01:15.760 is the seven areas that I've seen that'll let you know

00:01:19.040 if something's going wrong with your team.

00:01:21.240 Number one, speed of their feet.

00:01:23.380 I believe that if you have a team that when it hits

00:01:27.640 5 p.m., they are bouncing, they're out, they're done.

00:01:30.740 Because of the clock, you've got some issues.

00:01:32.740 I still remember we were building my company Clarity.fm

00:01:36.040 and we had just hired this new person

00:01:37.920 and it was his first day.

00:01:39.260 And at 5 p.m., I'm not even joking,

00:01:41.920 I'm in the conference room, I'm on a call

00:01:43.760 with somebody on the west coast

00:01:45.260 and all of a sudden I see the guy

00:01:47.020 out of the corner of my eye walk past and leave the office

00:01:50.320 and I just said, hey, I was on the phone,

00:01:52.100 I said, just one sec, pause, muted them,

00:01:54.160 opened the door of the conference room and screamed out,

00:01:55.940 I was like, did that guy just leave?

00:01:57.980 And they're all like, yeah, he just left.

00:01:59.440 And I'm like, wow, okay, close the door,

00:02:02.440 get back to my meeting.

00:02:03.280 The next day we had a conversation because look,

00:02:06.220 I've never built a company where it was a time-punching

00:02:12.700 in, come do your work kind of scenario.

00:02:14.800 That is just not the kind of people I wanna work with

00:02:17.060 and it's not the kind of place that I create.

00:02:19.440 I wanna let people have the freedom.

00:02:21.340 If they wanna take a three-hour lunch, they can do that.

00:02:23.400 If they wanna start and work early in the morning

00:02:25.400 and get done by noon, they can do that.

00:02:27.040 But to me, it's not about just punching in and punching out.

00:02:30.080 And I've seen this at many other companies.

00:02:32.380 You know, parking lots just clear out.

00:02:34.200 Boom, 4.30, bam, gone, everybody's out.

00:02:37.480 They essentially, the speed of their feet

00:02:40.280 is what shows you if they are committed to the business.

00:02:43.680 Number two, asking for perks and raises.

00:02:46.480 Now, I'm not opposed to compensating.

00:02:48.820 I actually compensate my team on the upper end

00:02:51.820 of what I should because I want high-performing people

00:02:54.660 and I want them to be comped accordingly.

00:02:56.800 But what I've learned and I've coached hundreds of

00:02:59.200 entrepreneurs scale their executive leadership teams and

00:03:01.640 their teams in general is that when they have a half dozen,

00:03:05.780 a dozen people out of 30, 40 folks on their team,

00:03:09.100 all of a sudden come up to them and ask them for a raise,

00:03:11.540 ask them for more perks.

00:03:12.880 There's usually something going on systemically in their

00:03:15.740 business that's causing that because at the end of the day

00:03:18.860 somebody's working at your company and if they feel like

00:03:21.280 they're kind of stuck there and they're not getting their

00:03:24.220 needs met and they're not feeling like they're being

00:03:26.080 appreciated and they don't feel like they're progressing in

00:03:28.420 their career path, then they're just going to ask themselves

00:03:30.760 like, what am I getting out of this?

00:03:32.160 And the first easiest place for them to look is, hey, I want you

00:03:35.700 to pay me to go on more training.

00:03:37.260 I want you to offer daycare.

00:03:40.200 I want you to offer these, you know, I want to raise.

00:03:42.340 And to me, if you see multiple people do that in a short period

00:03:48.220 of time, you got to start asking yourself, where are we lacking

00:03:51.140 in the reward system of really encouraging people

00:03:56.520 to feel committed to their career path

00:03:59.320 within our organization.

00:04:00.820 Number three, lack of empathy.

00:04:03.580 Now this is a really interesting word.

00:04:05.560 Empathy to me is that just people care.

00:04:07.900 And when I've seen the contrast of bad cultures,

00:04:10.460 you know, these government agencies,

00:04:11.960 like everybody was out for themselves.

00:04:13.660 They didn't care, but they wanted something.

00:04:15.340 They didn't care if anybody else got it.

00:04:17.040 Whereas on the flip side, when you see, you know,

00:04:19.300 these high-performing teams at these high-tech companies,

00:04:21.900 they're really operating as a primal unit,

00:04:26.280 as one group of people moving towards a mission.

00:04:29.580 And one of those things is empathy.

00:04:30.980 And you see it in meetings, you see it in language,

00:04:32.880 you see it in emails.

00:04:34.020 I've seen this where, you know, there's an email that asks

00:04:36.320 for a request for access to something and the person in

00:04:38.360 reply is, fill out this form.

00:04:40.080 It's like, where's the empathy in that?

00:04:42.380 If you really want to see your team be successful,

00:04:44.560 then you want to offer to be helpful.

00:04:46.200 So if you notice that the messages,

00:04:48.460 the communications, the conference calls

00:04:50.660 are getting a little transactional

00:04:52.960 and there's lacking a sense of support

00:04:57.060 from other teams and departments,

00:04:58.600 then you might have an issue you need to resolve quickly.

00:05:01.540 Number four, dissatisfaction and anxiety.

00:05:04.740 You know, one of the worst things that you could create

00:05:08.080 is a culture where people feel anxious to come to work.

00:05:12.180 And I've seen this, I've had team members,

00:05:14.720 I find this after the fact, I've had team members

00:05:16.780 cause other members of my team the need to go get medication,

00:05:21.280 to get prescription, to deal with the level of anxiety

00:05:23.520 that they felt in their work.

00:05:25.320 And you know, I have a rule that if somebody has an issue

00:05:27.760 with somebody else, they go direct first

00:05:29.420 and if they can't resolve the issue,

00:05:30.500 then they come to me.

00:05:31.720 And to me, if I have a team member causing that level

00:05:35.260 of frustration, dissatisfaction, anxiety amongst the team,

00:05:38.900 they gotta go, like I just don't, I don't put up with that.

00:05:41.800 If somebody has to go to the point where they're taking

00:05:44.940 medication to deal with that, I think that that needs to be

00:05:47.980 resolved and it tells you right off the bat you have a toxic

00:05:50.640 culture.

00:05:51.640 If you don't have a tool that does an internal ENPS, an

00:05:55.380 Employee Net Promoter Score, to uncover these scenarios or

00:05:59.280 these teams or departments, it could be in different areas of

00:06:01.760 your business, that are underperforming from a

00:06:04.220 satisfaction point of view, then you gotta resolve that.

00:06:07.000 You gotta get that technology, you gotta get that survey,

00:06:09.000 you gotta ask that question to make sure that you understand

00:06:12.500 who's feeling dissatisfied

00:06:13.900 or who's feeling anxious in their job.

00:06:16.140 Number five, high turnover.

00:06:17.980 This one's a no-brainer.

00:06:19.100 If you continuously have people joining

00:06:21.180 and leaving every four to six months,

00:06:23.120 then you have a problem with your business.

00:06:24.940 And this is the worst part.

00:06:26.340 It's not, when you keep a C player, a D player,

00:06:30.660 it's not they're underperforming

00:06:32.720 that actually impacts your business the most.

00:06:34.860 It's the fact that an A player won't work

00:06:37.200 with that kind of person and they leave.

00:06:39.360 So essentially what you end up with is a person

00:06:42.100 that isn't performing in the first place so they're having

00:06:44.040 an impact to the business and they cause so much frustration

00:06:46.780 that your A player decides to go find another team to join.

00:06:49.840 And to me, high turnover is a no-brainer obvious area

00:06:53.940 that's telling you you've got a toxic culture.

00:06:56.040 Number six, a failure to meet deadlines or goals.

00:06:59.960 If your team continuously frustrates you that doesn't

00:07:03.680 deliver on their goals, do not perform or not hitting

00:07:06.820 their numbers, then you've got to look at the culture

00:07:09.700 and the communication structure that's set up

00:07:12.100 to allow the team to operate, okay?

00:07:14.900 Culture to me is a byproduct of rules, of structure,

00:07:18.180 of a communication rhythm, of what your reward structure

00:07:21.580 is in place to allow people like they're performing

00:07:24.380 or they're not.

00:07:25.220 So there's a level of accountability, clarity,

00:07:27.520 and support to allow them to get results in your business.

00:07:30.620 And if they continuously miss deadlines,

00:07:32.580 there's something missing from a culture point of view

00:07:34.620 that needs to be resolved.

00:07:35.960 Number seven, lack of core values.

00:07:38.960 My rule is is that you hire and you fire

00:07:41.600 against your core values.

00:07:42.500 And these are not things that you just put up on a wall

00:07:45.180 and look at and recite.

00:07:47.600 These are things that you're measuring every new hire against.

00:07:50.440 There's core value interview questions.

00:07:52.620 There's, you know, when you're doing employee reviews,

00:07:56.240 there's employee review questions to make sure that

00:07:58.280 they're meeting and exceeding those values as a team.

00:08:01.160 Because at the end of the day, when you start getting to 20,

00:08:04.480 50, 100 people on your team, there's no way you're going to

00:08:08.000 be involved in every decision.

00:08:09.320 What your core values become is a rule set for everybody else

00:08:12.660 to make decisions against and you know that if they follow

00:08:15.760 these values that they're gonna make the right decision.

00:08:18.500 It's almost like they're the guiding principles or true north

00:08:21.540 to making decisions and moving forward in your business

00:08:24.800 without you being involved.

00:08:26.440 Now, if you don't have those, then that's where the culture

00:08:29.800 for me starts to break down because without some mission,

00:08:32.540 without some kind of values to guide people,

00:08:35.340 folks will start looking internally.

00:08:36.940 They'll start looking for things that are wrong.

00:08:38.380 They'll start gossiping.

00:08:39.320 They'll start having politics show up in the teams

00:08:42.580 and that's when things start to take a downward turn.

00:08:45.360 So seven things that are telling you

00:08:46.660 that you might have a toxic culture.

00:08:48.620 Number one, speed of their feet.

00:08:50.260 Are they leaving at 4.30 p.m.?

00:08:52.920 Number two, asking for raises or perks.

00:08:55.160 Number three, lack of empathy

00:08:56.660 amongst your communication and your team.

00:08:58.260 Number four, dissatisfaction and anxiety amongst members.

00:09:02.440 Number five, high turnover in your team.

00:09:05.900 Number six, failure to meet deadlines or goals.

00:09:08.400 And number seven, lack of core values.

00:09:11.580 So as I mentioned at the beginning of the video,

00:09:13.000 I want to share an incredible resource with you

00:09:14.880 called the Weekly Sync.

00:09:16.120 It's the same format that I use every week with my team

00:09:19.740 and different departments in the organization

00:09:22.240 to make sure that we're on the same page,

00:09:24.220 that everybody understands what the rest of the team is working

00:09:27.020 on and that we measure the right scorecard

00:09:29.560 to ensure we're making progress.

00:09:31.560 Now the trick is to use the same Weekly Sync.

00:09:33.900 You can download your copy below.

00:09:35.120 Just click the link and get that to use the same structure for

00:09:38.960 each departmental team meeting.

00:09:41.160 So you might have an executive leadership team every Monday

00:09:44.460 meeting where you use the weekly sync and then you might have a

00:09:46.640 sales, a marketing, a biz dev, et cetera meeting using the exact

00:09:50.000 same structure just to make sure you get everybody on the same

00:09:53.040 page so you can click the link below to download your copy.

00:09:56.280 And if you like this video, be sure to smash that like button,

00:09:59.480 subscribe to my channel.

00:10:00.640 And if there's somebody you think that this video could serve,

00:10:03.040 Feel free to share it with them directly as per usual.

00:10:05.600 I want to challenge you to live a bigger life

00:10:07.340 and a bigger business and I'll see you next Monday.

00:10:09.620 Hold that.

00:10:10.940 Great, got it.

00:10:12.800 Alright.

00:10:14.120 Yeah, yeah.

Dan Martell - February 25, 2019

How To Tell If You Have a Toxic Culture in Your Startup

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