By Brian Hayduk, Partner and CEO of 5
I was a 31-year-old salesperson working in New York City, New York, USA, when the startup energy company I was with, New Energy Ventures, was acquired. Without anything close to the experience to justify it, my new boss promoted me to running the region, a business approaching USD500 million in revenue. He also charged me with completely transform the group from a small sales office to a fully functioning electricity company complete with energy trading, risk management, legal, accounting, billing and customer care. After picking myself up off the floor, I asked how much I could spend. The answer: Whatever you think is appropriate, it’s your business and we trust you to make the right calls.
That was an earthshaking and foundational moment for me with respect to culture and values. It went against everything I thought about big corporations, decision-making and culture. That company was the AES Corporation. They were doing many of the things considered groundbreaking today — no vacation or employee-related policies, extreme empowerment, flat and open communication, decentralized organizational structure — and doing so in the late 1980s! What appeared to be groundbreaking to me back in 1999 was simply an everyday occurrence around the world as they lived and breathed their values.
Changing my thinking on company culture
I’ve carried my AES experience with me throughout my career. It guides my thinking of culture and values at my current energy advisory firm, 5. Changing the way businesses buy and use electricity and natural gas while simultaneously raising the bar for the entire deregulated energy industry is an audacious goal. It’s exactly what we set out to do when we started 5.
The company is more than six years old and making significant progress toward this industry-changing goal. Our team has been recognized for numerous growth and culture awards, including the Entrepreneur 360 list and multiple appearances on the Inc 5000 and “Fortune’s” Best Workplaces in America list.
The foundation of 5’s ongoing success is built upon our five core values. These values were determined through an iterative process with the entire team’s involvement and serve as the focus and the filter for the way that we communicate, collaborate, terminate and celebrate.
Our five core values are accountability, honesty, integrity, fun and excellence. But these are just words. Truth be told, you can find a similar set of words at almost every organization that’s taken the time to write something down. Culture is not created by a list of words. Your stated values are simply the marketing arm of what you believe to be true about people and organizations. Here is my list of the critical items that drives our stated values:
- Golden Rule — Treat people the way you want to be treated. You could probably stop here.
- Capability Mindset — Assume people are capable of being the business person you wish you had in every position. Assume they are capable of much more than you see today.
- Empowerment — An overused word I know, but the concept is not. It doesn’t matter what you call it, just give people more than enough rope to succeed or fail. Enough for them to show you the above (#2) is true. You will be shocked at what people are capable of once freed.
- Belief — If you believe that transformative culture only applies or can take hold at small companies, be open to the idea that that is simply a story you’ve told yourself and not a fact. Empowerment, flat organizations, open book communication, little to no policies that are intended to control behavior (e.g., vacations, maternity leave, conduct policies, clocking hours, handbooks) can apply anywhere.
- Practice Makes Perfect — Every day is an opportunity to practice. True culture and values are reflected in how we communicate within the organization, what we communicate, to whom, how we organize meetings, orientation of new employees, policies and procedures (or lack thereof), decision-making, etc. As we think about all these ways of practicing culture and values, are we filtering our daily practices through items 1-4 above?
Where to begin?
The winning combination of these foundational beliefs and five values allows our firm to focus on changing an industry and growing together. It has also been amazing to see our approach to values and culture play out in Mexico where we have an expanding operation. Our concepts are even more foreign in this traditionally top-down business culture, but the results have been the same. People are people.
Even with some measure of success, we are far from perfect. Constant feedback and evaluation is required, no different than any other aspect of our business. Through recent employee feedback, we identified accountability as our weakest value and have set off on a path to improve.
The key to successful implementation of your stated corporate values is to start with the “why.” Why do you believe what you believe? Make sure everyone knows the “why” and participated in the discussion in some way. Once this foundation is set, make sure there’s articulation of each stated value and useful tools to explain the behaviors that exemplify each one. Now words become culture.
A YPO members since 2011, Brian Hayduk is a Partner and the CEO of 5. He has been in the deregulated electricity market since it began in the late 1990s. His background includes leading and developing deregulated energy businesses throughout North America. Prior to launching 5, Brian served as President of First Choice Power where he had responsibility for all company operations and led the business to record growth and profit. Hayduk also serves on the executive committee of the Children’s Advocacy Center for Denton County, Texas, USA. He also encourages sustainable practices at 5 and he’s the only 5 partner who can claim pizza making and fishing boatmate on his résumé.