CEO Shoptalk — What Do You Tolerate?

In the CEOing business, we spend a lot of time discussing culture, as we should.

Culture is spawned by the founder’s values which many times are a work in progress, particularly for first time CEO/founders. Perfectly natural.

In mature startups — still growing, but growing at scale meaning they are out of the cradle and “walking” swiftly in the crawl, walk, run continuum — this becomes incredibly important as the CEO cannot have a finger in every pie and the best CEOs are excellent delegators which mandates giving up a modicum of control.

It is at this instant in time that the company, its workforce, begins to own the culture and grow it though they never abandon the founder’s values.

As the culture grows, marinates, and enrichens, new directions emerge, new initiatives are embraced, but there is one thing that never changes:

Cultures are driven by what the CEO/founder tolerates.

If the CEO/founder tolerates low performance, you will get low performance.

If the CEO/founder tolerates a passing relationship with truth, you will get a small amount of truth.

If the CEO conducts his/her affairs with no evidence of being a charm school grad, you will get no charm.

If the CEO/founder tolerates low KPI attainment, you will get low KPI attainment.

You can see the pattern, no?

The corollary is this: Whatever behaviors you reward, you will get more of.

I once wanted my monthly financials for a public company of which I was the CEO within 3 days of the end of the month. Not a popular idea with my CFO who was extraordinarily experienced and qualified and wedded to the idea that getting them within 14 days of the end of the month was the industry standard.

In those days I used to come to work early on Saturday morning to escape the noise so I could focus on the signal.

While I arrived at 5:45 AM, there was already a car in the parking lot and an accountant who handled a big section of the books was hard at work. I put my hand on the hood of her car — it was cold. You can divine the meaning.

At the next monthly “all hands” meeting, I counted out five $100 bills and walked to that woman in front of the entire headquarters staff and handed them to her.

During the mandatory “5 more questions before we adjourn” portion of the meeting, someone asked me, “Why did you give Mrs. X $500, Jefe?”

I coyly said, “Ask Mrs. X.”

Thereafter, I got my financials, including all GAAP journal entries, 3 days after the end of the month. Every month. The accountants came in on weekends to make this happen and got comp time during the month to offset it.

What do you tolerate? What behaviors do you reward?

You will get what you tolerate and what you reward, CEO/founder. Class adjourned for today.

But, hey, what the Hell do I really know anyway? I’m just a Big Red Car.