Momondo Group's founder on why high growth can't paper over the culture cracks

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Hugo Burge
CEO
Momondo Group
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As far as innovative and disruptive success stories go, there are not many stronger recent examples than Uber.

Its founders identified and acted on an immense opportunity, delivering a new approach to an outdated model with a solution that was simple and empowering for both its users and its drivers.

It looked like a win-win, and the strong reaction from the existing industry clearly proved it felt threatened by this upstart. With a bold, fresh, self-starting strategy in place that rode the entrepreneurial zeitgeist of global digital opportunity, Uber has experienced mind-boggling growth in just a few years.

Greatness in business is defined by more than sexy press coverage about growth and sector disruption.

Yet from the outset, Uber has been unable to shake off the spectre of controversy. A positive markets narrative of growth rates and financial performance has not dampened allegations of a toxic culture within the company – and these are emblematic of a challenge that seems to particularly beset the so-called ‘sharing economy’.

Uber isn’t the first - just ask executives at eBay, Deliveroo or AirBnB, which have also had to iron out some deep creases as they have scaled.

In one way or another, these businesses and others in the sharing economy open-source their product and services – and their brand – to both their employees; be they drivers, ‘deliverers’ or property hosts; and their users.

This creates an intricate mesh of ‘stakeholder ambassadors’ across a variety of societies and countries. It’s a disruptive model, refreshing in many ways, and able to scale as quickly as ordinary people are willing to accept the risk of adopting it or getting involved themselves.

But at the same time, it’s a model that cannot be ultimately controlled – and that creates a problem for the culture of those businesses. Culture must be the backbone of any company and letting it drift can lead to businesses – particularly those which find success quickly – being victims of their own triumphs.

If its users and employees see the leader of a business treating his own people like that, what incentive do they have to invest any long term loyalty into the brand?

A strong culture translates into a good company, built on solid foundations – which in turn translate into the kind of company consumers want to stay with over the long term. That loyalty equals sustained profitability.

Short term success can be achieved without it, when your baby is suddenly everyone’s darling and everything seems possible. But, with due respect to my own experience and a couple of my favourite business books, if you’re looking to go from good to great, a strong culture is critical if you want your business to be built to last.

In those early heady days, the natural temptation is to allow progression to trump culture - the advice is usually to make hay while the sun is shining, and the fluffy stuff can wait. But doing so sows seeds with deep roots which are hard to pull up once the plant is in bloom.

My experience has shown me that businesses which place company culture at the heart of what they do from day one are better able to ensure it stays in that position as the business expands; the people it hires, the products and services it offers, the way it communicates, its values and its purpose.

Retro-fitting a culture, or building one up within a company at scale is much harder and Uber’s current problems can be traced to a ‘growth first’ focus that mean it was distracted from ensuring its employees are pulling in the same direction, living and breathing the culture wherever they are in the world.

Looking back, I have to say it was the best decision I have made.

Whilst, in fairness, their decentralised structure means that managing that narrative across varying cultural and societal practices was always going to be difficult, Uber management has made its own job much harder by failing to set the right tone itself.

The other day, Uber’s founder Travis Kalanick was caught on tape berating an Uber driver. If its users and employees see the leader of a business treating his own people like that, what incentive do they have to invest any long term loyalty into the brand?  

Our culture at Momondo Group today is rooted in three simple values: Courage (to take risks); Action (we execute like hell and ensure we deliver); Love (we treat each other with respect).

By adhering to those principles, we believe that we are better able to deliver on our mission to build products users love – and if we’re doing that, we’re on the right pathway to realise our vision.

It’s not easy, we are not perfect, but it’s something we’re proud of and work at every day. Arriving at that structure took time. It was my responsibility as CEO to take the time to understand what we stood for, define our purpose and then invest the resources and energy in integrating that into our business – knowing that doing so would eventually pay dividends in our overall performance.

Looking back, I have to say it was the best decision I have made.  

Greatness in business is defined by more than sexy press coverage about growth and sector disruption. Yes, success and subsequent rapid growth come when a great idea is executed with a product to match. But as a company expands, its culture is its defining success factor.

If it’s neglected, whether that is external, as Uber has experienced, or internally, cracks will appear. Uber and others of us along the way, have learnt that building and implementing a strong sense of culture from the start is essential to ensuring a business has all of the tools in place to thrive, both initially and as it spreads its wings to mature as a sustainable profitable business.

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20th Mar 2017 10:55

I fully agree with what you said; otherwise my first business wouldn't have been called 'Cultural Connective'.

However, I think it is important to understand that a business automatically changes its culture as it grows and matures. Therefore, one needs to revisit one’s values and respective practices / behaviours. For example, a 5-year old needs to trust in its parents and a teenager needs to learn to trust him/herself.

1. The Leader’s courage in a naturally risk-friendly start-up culture
For example, when MMG was under 15 people 'courage' would have been very much driven by you. People trusting in your idea / intuition and following you without necessarily questioning your risky ideas.

2. Formal vs. Spontaneous Risk: Replicating courage in a growing business
As you grow to 30 people you suddenly have a slightly more risk-averse environment and need to find / hire people who are not only entrepreneurial but like to take risks. At the same time 'the organisation' needs to learn from mistakes, more formal guidelines need to get put in place to avoid replicating failures. At the same the leadership style needs to be modified to give people more space, employees need to feel that they can take risks.

3. Courage as part of the business thinking and model
Once MMG’s market matured and competitors stepped up their game the nature / culture of the business needs to change - yet again. Complacency is a topic here and I like your reference to ‘from good to great’.
First, you need to train employees up to be able to makes decisions based on numbers. Second, employees need to have a clear understanding of what measurable objectives look like and how they relate to them. Third, people need to have access to data, be encouraged and empowered to take informed decisions (whilst including others in their decisions).

So, I think you are absolutely right with stating how important culture is. However, every growing business and its culture will need to be recalibrated along the way. I think it is important to be aware of these 3 universal growth stages; to ensure you review your values and translate them to the current nature of the business. After all, courageous behaviours in a start-up like MMG at the end of the 90’ must have looked different to now or not?

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