‘Peer pressure beats any manager’: Young Rich lister and Appster co-founder Josiah Humphrey on what corporate Australia can learn from startups

Corporates must follow startups’ structural example, writes Appster’s Josiah Humphrey.

Technology has globalised the workforce and it’s no longer unusual to run a remote team in multiple countries. In the western world, the growth of freelance represents the major workforce shift since industrial revolution.

Not surprisingly, for many millennials, the traditional corporate path is obsolete as the majority of the global workforce is actively or passively disengaged, according to Gallup. Likewise, the data (McKell Institute) from Australian industry shows that productivity growth is in decline.

Yet some companies are on the winning end. Usually, it’s the startups which have flexibility to adapt that take the markets by storm. So naturally, as the new disrupts the old, the old has to adapt. It’s not the strongest or the most intelligent that survive, but the ones that best manage change.

KEEP YOUR COMPANY CULTURE WITH GROWTH

The main differentiator that allows startups to take markets by storm is the company culture. The culture builds the winning environment and success that comes with winning tends to become a self-fuelling loop of higher motivation, drive and passion that in turn leads to more success.

Companies like Google, Apple, Uber or Tesla have a big inspiring vision that allows them to attract top people from the established companies. They also represent values that attract certain kind of people who are best suited to make great things happen.

For example, Apple is about being insanely great; Tesla is about changing the world; while Uber is all about being aggressive no matter what others think. At Appster, we’re about disrupting status quo. As we’re enthusiastic about building disruptive and game-changing apps, our team is full of people who get fired up about it.

What’s different between Google and let’s say Yahoo, or Apple and Microsoft, is that the former ones managed to keep the culture with growth. The number one rule we implement at Appster (and the point where most corporations screw up) is hiring for culture fit.

When you grow fast, you don’t always get to find an ideal person that offers both a culture fit and great skills. In many cases it’s either one or the other, and traditional corporation always goes for skills. At Appster we hire for the culture fit, as you can always train the skill if the person is right.

GET RID OF THE TRADITIONAL CORPORATE LADDER

What makes startups operationally superior is usually the way they organise their teams. While big companies move slowly because of bureaucracy, endless meetings and group emails that cc the entire corporation and solve nothing, innovative companies stay agile.

There are several ways to avoid bureaucracy of typical corporate workplace. Probably the key one is empowering small teams instead of building a complex organisation with large departments that miscommunicate. Small teams preserve entrepreneurial culture and are faster to move.

Many startups like Github, Spotify, Medium, Zappos and even Appster implement flat management structures or a form of holacracy. Getting rid of management and empowering self-organised teams eliminates a lot of traditional hurdles that make corporate ladder obsolete. Peer pressure after all is a much better motivator than any boss or manager.

Obviously, such a bold step can bring risks too. But it can also save an established company from going boring and obsolete. A great example is Haier, a Chinese refrigerator company founded in 1980 that recently scrapped the traditional model too and went completely flat. The result? Innovative products and an incredible revenue growth surpassing $32 billion last year!

IMPROVE WORKFORCE DYNAMICS

The latest studies show that the new generation of workers lean more towards intrinsic rewards such as autonomy, mastery, and making a difference in the world. Not surprisingly, companies that dominate new markets are great at providing that.

It’s no secret that some of the most successful Google products like AdSense and Gmail were built in the so called 20% time, the time that employees are allowed to dedicate to any project they come up with.

Likewise, great companies allow employees to have flexible work hours and provide them with autonomy over various areas of their work. This includes how, where, when and with whom the work is done. This fosters a sense of responsibility and entrepreneurial mindset, which is very much needed in today’s Australia.

Josiah Humphrey is the co-founder and co-CEO of Appster, a mobile app and product development company with offices in Melbourne and San Francisco.

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