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Scaling company culture in a worker-defined workplace

Brian Halligan,              SF ’06

The organizational culture at HubSpot that everyone is talking about, wasn’t supposed to be talked about at all, according to the company’s CEO and cofounder Brian Halligan, SF ’06. His initial approach to company culture was inspired by the Fight Club credo—the first rule about culture is that you don’t talk about culture. Halligan decided to break that rule, however, after a chat with Colin Angle ’89, SM ’91, chairman, CEO, and founder of iRobot. “Colin convinced me that to scale our hiring, we had to figure out culture,” he says.

HubSpot’s pivot paid off. Its culture flourished through the challenges of its 2014 IPO and an explosive workforce expansion (roughly tenfold in five years). Today, the company is setting the standard for a worker-defined workplace. It was just rated the #1 Best Place to Work in 2020 by Glassdoor’s Employees’ Choice Award, and the review platform Comparably placed HubSpot on several of its 2019 “best” lists— including Best Companies for Women, Best Companies for Diversity, Best Company Culture (#5), and Best CEO (#2).

Documenting conversations about culture
How did HubSpot do it? After the conversation with Angle, inspired Halligan to reenvisioned HubSpot’s culture through an inbound marketing lens. “A great product acts like a magnet that attracts customers,” he says. “In a similar fashion, a vibrant and healthy culture is a magnet that helps attract and retain employees who, in turn, recommend us to their network of talented professionals. It encourages a virtuous cycle.”

Halligan’s rethink—and the company initiatives it inspired—led to publication of The Culture Code, HubSpot’s culture document that has attracted more than three million views on SlideShare. “Discussing and documenting our culture made it actionable,” notes Halligan.

Those early conversations and surveys also revealed a surprising sore spot among employees with one to two years of tenure. “We learned that our ‘mid-life’ staff members had serious concerns about career advancement within HubSpot,” Halligan says. “We immediately ramped up our efforts to communicate existing opportunities for career development, and we tailored new opportunities for this segment of our workforce. We made sure we expanded their opportunities for learning and advancement before they began to think of expanding them somewhere else.”

Driving culture
That is not to say that creating culture was a one-shot deal at HubSpot. To ensure the continued evolution and growth of the company’s culture, executives created the position of Chief People Officer in 2015. Katie Burke, MBA ’09, took on the role in 2017 and now oversees the global People Operations organization including the company’s recruiting, HR, learning and development, culture, and employer brand teams. Burke’s tenure is also notable for an emphasis on diversity and inclusion programming and a 20% increase in women in leadership. Fortune.com recently placed HubSpot on its “100 Best Workplaces for Women” list.

Burke believes the future workplace will become increasingly human-centric. “We see more and more top candidates in the job market demand more human-centric environments,” she says. “They’re asking questions about how we prioritize mental health, for example, and how we implement gender pay equity. They also want to understand how community impact factors into our mission.”

Transparency will continue to drive company cultures forward, Burke says. “Sites such as Glassdoor and Comparably are changing the game. Employees and candidates don’t just request transparency, they demand it. That’s pushing organizations beyond superficial notions of diversity toward making true inclusion and belonging a business priority. And when people of all backgrounds feel that they can grow personally and professionally in your company, everybody wins.”

Creating a human-centric organization in a volatile global arena

Reaching back to his childhood in Monterey, Mexico, Mauricio Chapa, SFMBA ’19, can remember the ways the company he works for now shaped his life. Chapa is Division Vice President for Talent and Compensation at Sigma, a division of ALFA, the seventh-largest company in Mexico. Chapa worked at ALFA for six years before transitioning to its subsidiary and says the company’s powerful commitment to community is one of the factors that motivates him to remain part of the team.

Mauricio Chapa    SFMBA ’19

As a child, Chapa’s parents took him to the elaborate family-oriented complex that ALFA developed for the community, which includes gardens, an aviary with rare birds, and the state-of-the-art science museum and planetarium that fostered Chapa’s appreciation for science and technology. In fact, it led him to pursue his MBA at MIT.

When Chapa was a student in the MIT Sloan Fellows MBA Program, he was taken aback at the astonishment of his classmates when he talked about ALFA’s commitment to community. “ALFA has always believed that what’s good for the community is good for ALFA—that the success of both are inextricably linked.”  Chapa explains that the company’s core ethos hasn’t changed since it was established as a brewery at the close of the 19th century. ALFA’s generosity of spirit makes his life as an HR executive more rewarding, he says. The challenges of motivation and retention, for example, are easier when employees feel that the company is invested in their wellbeing.

Redefining community in a global organization
But community in 2020, he points out, has very different ramifications than it did back in 1890. Today, workplace culture must transcend physical location. ALFA and its subsidiaries have a footprint in more than 25 countries. Employees in Argentina, Poland, and India, for example, can’t take advantage of the extensive amenities available to its employees in Monterey. How do you instill a shared, cohesive culture and a strong sense of community across so many different time zones?

In addition, ALFA has in its stable a very diverse set of industries—aluminum auto components, petrochemicals, oil and natural gas, and refrigerated foods—each with its own subculture. How do you retain a unified corporate culture across industries and continents? “It’s all about technology,” says Chapa. “ALFA is launching a digital platform to bring together everyone under one umbrella so they can bond, interact, collaborate on a project, converse, share ideas—even recipes. The generations that are coming into the workplace now are comfortable forging strong communities through social media platforms.”

Merging companies and company cultures
Chapa notes that during his career in HR, he has been especially aware of the challenge of preserving culture following a merger or acquisition. “It’s one thing to merge two companies—quite another to merge two company cultures. It’s essential to respect the existing culture of the company that is being acquired but, at the same time, make sure the employees of the new entity share the values of the company they are now a part of. The challenge requires awareness and sensitivity. There are no two scenarios alike, so it’s important to take each case separately and deal with it thoughtfully.”

It’s a delicate but crucial balance, Chapa says, and one that requires careful thought and strategy. “When do you centralize, and when do you decentralize? That is one of the key challenges of multinational companies. How do you get the most out of diverse synergies while reinforcing common values and avoiding cross-cultural misunderstandings and mismatches?”

He cites another human resources challenge for multinational companies—working from home. “The ability to work remotely is actually mandated by the government in some countries,” he notes, “while workers in other countries simply don’t have access to an infrastructure that makes working remotely possible. You want to have a policy that applies equally to all employees, but sometimes that simply isn’t possible. You have to find a way to mitigate that inequality.”

Your employees are your customers
Bottom line, Chapa says: A good human resources department regards its employees as its customers. “Organizations should want to establish a healthy relationship with its employees from the outset and work continually to keep them happy. There used to be a sense that the company was doing you a favor by employing you. That mindset has been turned on its head. We are continually refining how to connect with workers.”

What that signals, Chapa says, is that the era of the one-size-fits-all benefit plan is over. “HR must connect with employees, understand their personal situations, and be able to work with them to provide individualized benefits that enable them to do their best work. Maybe they need housing closer to work or help finding childcare. As with any customer, it helps to know who you’re serving, what they need, and what motivates them. The result? Happier employees who are invested in the company. In the end, they just perform better.”

 

A human-centric organization is a productive organization

Katie Luby SFMBA ’18

Katie Luby, SFMBA ’18, believes that employees are more motivated and invested when they know their work will make a person’s life better. Director of the Customer Success Group at Salesforce, Luby has learned over the course of her career that innovating in a vacuum does not engender the visceral satisfaction of creating an improvement to human quality of life.

 That connection—the employee’s task and the human impact—is not always straightforward, so Luby believes it’s essential for managers to make clear how a worker is improving the human condition. Most organizations serve people in some capacity, whether providing a product or service, and a customer-centric workplace is a human-centric workplace. “When you are focused on making life better for the customer, you are part of something bigger than yourself. It humanizes the work. Burn out and ennui are less likely. Workers are excited to think they are doing something that will change how people can be successful.”

Luby adds that customer service has evolved accordingly. “Customer service equals all the ways a customer deals with a brand. It’s not how long a customer is on the phone with the call center. It’s about quality, about truly satisfying the customer, not meeting artificial metrics.” Customers, she notes, are continually creating data, and workers need to be responsive to that data and communicate in an authentic way. “The goal is not to sell them something. Where do they need help…or want to be delighted? Data can be vivid if you know how to interpret it and roll it into a customer-centric strategy.” Luby adds, “When, as workers, we know more about the customer through extensive data collection, they become more human to us, and we care more about their needs. That ultimately makes for happier employees who are more committed to their work, more intent upon getting it right.”

Cross-functional teams are the most creative
The structure of how people work in a human-centric company, Luby points out, is necessarily different from one that isn’t. To meet the needs of customers, she points out, teams are formed around outcomes, not functions. “We form teams to create value for customers. That means that rather than being organized by business need or technology, we bring together teammates from different functions who can introduce a distinct and valuable perspective to a solution.”

For Luby, a human-centric workplace also means giving workers the freedom to create—and to fail. “Iterating is crucial to finding a successful solution. We need to offer a judgment-free path to getting to that solution. Teams must have room to experiment and to fail, to test things in the marketplace, get feedback, and adjust as necessary. In the past, workers were expected to bring only proven winners to market, so they had to be very sure of any new product before releasing it.”

A setback in this innovation culture, Luby says, is a step on the road to winning—and successful products get to the marketplace sooner. It also creates a culture where employees are invested and excited to experiment. Not long ago, she notes, a large corporation would segregate its innovation arm to an offsite skunk works with its own free culture—a freedom that the C-suite didn’t want to contaminate the rest of the operation. Luby says that rather than segregating the innovators, the entire operation should share this culture of creativity. “To keep organizations nimble, these innovation practices need to be more core.”

Luby notes that lessons learned from failures and successes alike should be rolled into a company’s overall strategy. “That practice is not only important for the success of the company. It’s good for morale. With rapid results, data-driven decision-making, and a culture of human-centric innovation, teams see that the impact of their work has actually guided the direction of the company, giving them a true sense of being invested in the organization’s success.”

 

LabCentral to Advance Biomanufacturing Ventures in Kendall Square


LabCentral 238 at 238 Main Street in Kendall Square will open in the fall of 2021. Photo credit: Encore & Perkins+Will

Already dubbed the most innovative square mile on earth, Kendall Square is about to add another notch to its ingenuity quotient. LabCentral has announced its intention to essentially double its Kendall Square footprint in 2021 with the establishment of a new incubator focused on scale-up biomanufacturing. LabCentral 238—the name is a nod to its 238 Main Street address—will feature 100K square feet of shared office and laboratory space where companies can conduct process development studies. Unlike the original LabCentral incubator, LabCentral 238 will host startups that have cleared preliminary research hurdles and are headed eventually for clinical trials. The new venture will be developed on a site located on two floors of the 100-year-old Kendall Building. Distinguished by its historic clock tower, the building is being expanded to 12 stories with an adjacent addition. The German pharmaceutical powerhouse Bayer AG is expected to occupy a large swath of the space.

Astellas Pharma invests $12.5M in LabCentral 238
The LabCentral 238 initiative is made possible by a $12.5M investment from Tokyo-based pharmaceutical company Astellas Pharma and a grant from the Massachusetts Life Sciences Center. MIT Sloan Fellows Program alumnus Percival Baretto-Ko SF ’11 is Astellas Pharma president. The company will invest an additional $450K over three years to become a Gold Sponsor of LabCentral’s existing Kendall Square incubator at 700 Main Street, which has grown rapidly since it was established in 2013.

LabCentral 238 will make prototypes of the drugs on a fast track and at a lower cost. The drugs won’t meet the standards needed for clinical trials, but if a product seems promising, the startup will pay manufacturers to produce them at the necessary standard for clinical trials. Producing lower-cost prototypes at a faster rate will mean a greater number of life-saving drugs have a chance of reaching consumers sooner.

LabCentral takes inspiration from the energy of its neighborhood at the edge of the MIT campus and the legacy of innovation that preceded its tenancy. Its 700 Main Street location is the very place where Thomas A. Watson received that legendary first long-distance phone call in the 1800s. A century later, Polaroid founder Edwin Land established an office here. Today, more than 300 scientists and entrepreneurs from 70 startups rent lab benches and office space at 700 Main.

“We need more access to innovative startup companies,” Yoshitsugu Shitaka, president of the Astellas Institute for Regenerative Medicine, recently told the Boston Globe, “especially in the cell therapy and gene therapy space.” The two LabCentral incubators should do just that. Young biotech enterprises are drawn to the extraordinary amenities, including access to millions of dollars in laboratory equipment and face time with local drug developers. For global biotech companies like Astellas, the LabCentral cluster is a hothouse worth watching.

Read the Boston Globe article on LabCentral 238.

Finalists in the MIT Solve Challenge converge on New York

The MIT Solve Challenge, the legendary social impact pitch competition, reached its much-anticipated conclusion on September 22 during UN General Assembly week in New York City. A diverse group of 60 finalists will converge to present solutions around four global issues posed back in May. More than $1.6 million in funding will be available for the selected Solver teams.

MIT Solve advances sustainable solutions proposed by tech entrepreneurs to address the world’s most pressing problems. It issues four global challenges each year. In 2019, those challenges are the circular economy, community-driven innovation, early childhood development, and healthy cities. The goal is to identify the teams that show the most promise to solve some aspect of the challenge and drive transformational change. MIT Solve then links the innovators to its global partners—private, public, and nonprofit leaders that can help make the often audacious visions a reality.

The innovators who have reached the finals in New York will pitch their ideas to a live audience as well as a panel of judges. Those selected will work closely with Solve partners—cross-sector leaders like Starbucks, HP, Johnson & Johnson, and Save the Children. These partners will help the innovators pilot, scale, and implement their tech-based solutions.

Past Solve participants have included Canadian Prime Minister Justin Trudeau, Queen Rania Al Abdullah of Jordan, Amina J. Mohammed, Deputy Secretary-General of the United Nations, Eric Schmidt, technical advisor and board member of Alphabet Inc., Google’s parent company, Indra Nooyi, the former chairman and CEO of PepsiCo, and cellist Yo-Yo Ma, curator of the MIT Solve Arts and Culture Mentorship Prize.

The MIT Solve Innovation Fund
MIT Solve made headlines in the spring when it announced the launch of the Solve Innovation Fund, a $30-million-dollar philanthropic venture fund that will invest in early-stage entrepreneurs who appear poised to solve a global challenge. Noubar Afeyan, a member of the MIT Corporation and the founder and CEO of Flagship Pioneering has already committed up to $3 million to the fund.

“Solve’s mission is to tackle global challenges by helping early-stage innovators from all around the world connect with each other, tap the strength of MIT’s innovation ecosystem and, crucially, gain the resources to transform their ideas into impactful solutions,” said MIT President L. Rafael Reif. “The Solve Innovation Fund is an inspiring step to providing Solver teams with the capital to deliver their solutions at scale.”

Learn more about attending the MIT Solve finals—and about participating in the next round of challenges.