Speak Frankly, But Don’t Go ‘Over The Net’

Sep 17 2011

New York Times
This interview with Andrew M. Thompson, co-founder and C.E.O. of Proteus, a biomedical company based in Redwood City, Calif., was conducted and condensed by Adam Bryant.

Q. Can you talk about how to create an innovative culture?

A. I’ve been an entrepreneur for 22 years in Silicon Valley, so that essentially creates a life that’s defined by doing things that are innovative and different. When you build a company or organization that’s going to take on those kinds of challenges, I think there are two things that are really important.  One is that you reward innovative and new things in ways that are very obvious and are very visible — it’s the culture of what you talk about, what you celebrate, what you reward, what you make visible. For example, in this company, which is very heavily driven by intellectual property, if you file a patent or have your name on a patent, we give you a little foam brain.  But then, more important, right in our front lobby, there are shelves of big glass jars and everyone’s name in the company is on one of them — they’re like an apothecary jar. And that’s where your brains go. And so we have this huge wall that’s full of brains.
There’s no money in it. We don’t pay people to file patents because we’re an innovative company. That’s part of your job. But we recognize it and we make it extremely visible. Everyone who walks in the front door just looks and says “wow.” That’s a very specific and extremely powerful way that we promote and reward innovation. But there’s another thing that I think is probably a little less obvious: in the context of being an innovative company, it’s really important that you don’t penalize failure. In an innovative company, and particularly for a start-up company, you have to take risk. So you have to have a very strong bias to action over analytics, and for learning from mistakes and moving forward.  That’s very much what I call a leadership culture as opposed to a management culture, and it’s very counterintuitive to many people who come from large organizations where failure is absolutely clobbered. I want to be clear about this: It’s not that you reward failure. You don’t penalize it. What you focus on much more is risk-taking and a bias to action. So the real sin in a small company is not making a mistake, it’s not moving. That doesn’t always mean you move in the right direction. But if you discover you’re moving in the
wrong direction, you change direction. It’s fairly easy to see and to reward people who have those instincts.

Q. Tell me more about that.

A. In our company, at the senior team level, we talk about everybody in the company twice a year in a very structured way, where we spend several hours identifying people who we think are our golden seed. These are people who have very strong leadership instincts, who understand how to move the ball forward. They know how to take risks, and how to either build on work that’s successful, or they are able to say that something doesn’t work, and let’s move on, let’s change that. And those people we try to promote quickly.

Q. How do you reinforce this in the culture of your company more broadly?

A. If we have something we want to celebrate or talk about — let’s say we promote someone or want to recognize someone, for example — we’ll talk about it in a meeting. A big part of building a culture is around stories, right? So the stories have to be real, and they have to be vivid. If you’ve got someone who’s an effective risk taker, you make that very clear and you tell the story. You want these things to become legends.

Q. What are some other things you do?

A. Culture in our company is a really big deal, and we have a values system built around quality, teamwork and leadership. One of the activities around that cultural framework is the idea that employees can recognize each other — groups or teams can recognize or be recognized by other employees for doing things that specifically demonstrate those values. The way that works is that employees will write a nomination for other employees, and if it’s accepted, which it generally is, then at a company meeting the employees making the nomination will stand up and tell a story about how someone or a team of their colleagues was fantastic and here’s what they did that was of really high quality, or an example of great teamwork or really strong leadership.  The people who are recognized get a quarter-ounce gold coin, with the idea being that you can keep it as a trophy or sell it and have a few extra dollars. And the people who make the nomination get to go out to dinner. What I like about this is that management doesn’t do this. People do this for each other. It really promotes what I’m going to call mutuality.

Q. What does that mean?

A. People spend a lot of time in organizations being focused on hierarchy. The best, strongest and most functional organizations are ones where the horizontal relationships are really powerful and where people trust each other, work with each other, support each other, help each other, hold each other’s hands and move forward together.

Q. That has the ring of truth, of course, but how do you make that happen?

A. You have to build a very high level of trust, and a very mutually respectful organization where people work with each other and where employees are recognizing each other — rather than management doing it.

Q. What else about culture?

A. We have three volunteer teams that work on different aspects of our culture. I think that maybe a third of the company is involved on a voluntary basis in organizational development. And it’s working on a number of things. One team works on what they call “One Proteus,” which means making sure that there’s consistency, and there’s group identity, and that we all feel a part of one company, and that there aren’t sort of what I call intersite rivalries. There’s another group that works on feedback. One challenge we wanted to address is that we wanted to be a company where people could talk to each other honestly and give each other feedback directly rather than letting it fester or going to their boss and saying “I can’t work with Fred” because he’s whatever. It’s much better to go to Fred and say, “Hey, look, when you do X it makes me feel Y.” So everyone in the company now has had feedback training.  As the C.E.O., that means that one of the first things that had to happen was that I went with the management group, which is a fairly large group of about 30 or 40 people. You sit in a big circle, and they can all give me feedback. Actually it’s a very positive experience because people have been trained so they know how to give it in a way that’s appropriate and balanced so they can get their message across. So now everyone does that. We’re still not that good at it, but we’re learning and we’re trying.

Q. Give me an example of the kind of things you teach.

A. You’ve got to have people understand how you talk to each other, and it’s got to be direct. It’s got to be in the moment, and it can’t be “over the net.” When you give somebody feedback, it can’t be to say, “You’re doing this because you don’t like me,” or whatever. It’s got to be a very straightforward thing where you say, “When you yell at me, it makes me feel like I’m not valued.”

Q. What do you mean by “over the net”?

A. If you’re over the net, that means that rather than describing the behavior and how it makes you feel, you start explaining to the other person what their motivations are for their own behavior. That’s where you get so many problems, because people see the behavior and rather than giving feedback, they sit there and stew and concoct all the reasons why it’s happening. People concoct all this imaginary garbage about why the person is doing this to them when in fact the person may not even realize that they’re doing anything. It’s like in tennis or volleyball, and you have to stay on your side of the net. And it’s very simple, right?

Q. What have you learned from some of the feedback?

A. What I find interesting in these environments is understanding fairly specifically how what you may do or how you interact affects different people very differently.

Q. Is there an example that leaps to mind?

A. In one example, there were folks who felt that my style was just very intimidating and very demanding, and other people who found it very productive and very rewarding. And some of it is about understanding and explaining what I’m doing and why I’m doing it. Human systems are very complicated, particularly as you gain any type of scale in an organization. But it’s important, because the culture that you build and the ability to be adaptive will define the quality of the outcome.

Q. You mentioned there are three groups — what’s the third one working on?

A. That group created for us a very complete wiki, which is now used by the whole company as its main communication platform. You can put something up there and say here’s what this group is working on, and people can come back in and add stuff to it. It’s very flexible. It’s a great example of a group of people collectively building and creating, as opposed to somebody in the I.T. department saying here’s how the company will communicate.

Q. Any other unusual things about your culture?

A. One other thing we do is called FedEx Day. Pretty much anyone can apply for FedEx Day, or any group of people. The deal is that you can take the whole day and go off and do something, but it’s FedEx, right? So it has to absolutely, positively be delivered overnight. And you can break it down, because maybe you want four FedEx Days, but there has to be a deliverable for every day. That’s also terrific because it’s everything from very simple little things — like improving the layout of the desks in the area — all the way through to fairly important things.

Q. You’ve obviously thought a lot about culture.

A. My idea here is to create a culture and an organization that has very clear values, is completely purposedriven, and where as much as possible people feel like they own it — not because they have stock options, but because it’s a place where they come to live as well as to work. I’ve worked with the same business partner for 22 years, and he and I have very similar instincts. We learn a lot from each other. But we’ve always believed that you want to have organizations that are very organic, very ground-up, where people own it, drive it, love it. And you can get real value out of that.

Q. How do you hire?

A. I always say to everyone at Proteus that we don’t hire pegs, we hire people. We have job descriptions, but we’re looking for very capable authentic personalities. We hire in teams, so that’s really important. So there’s no individual hiring. And we hire across functions, so you don’t just get to hire within your area.  The single most important aspect of the hiring process is the human interaction — the cultural fit and the person’s raw talent. So we’re very biased toward talent over experience.

Q. Break that down for me.

A. So cultural fit is very clear. It’s about people who talk about impact, and who are authentic about it and can be specific about places or spaces they’ve been where they’ve made an impact. That matters because we’re a very impact-driven and purpose-driven company. We want people who come to work with their head, their heart and their hands. All of it. You want the whole person walking through the door. If somebody doesn’t have passions, that’s a problem. People who like risk and who are biased to action have some passions. They have things that they’re excited about. It could be their kids. It could be their sports. It could be their sewing machine. It could be all kinds of things. But they have it. If they don’t, and if all they want is a paycheck and they don’t really care where they get a job, that will come through, too. And frankly, some people are like that, and some people want to go to work with their hands, and they want to leave their head and their heart somewhere else.

Q. How has your leadership style evolved? What are you doing more of, or less of?

A. I go to fewer meetings.

Q. Because?

A. If you’re the C.E.O. and you’re in the meeting, it’s very hard for it to be anybody else’s meeting. If you want to have a strong organization, you want to allow people to run their processes. So you don’t want to be in their meetings. And you want to be very careful about how many meetings you have, because that stops people doing work and has them all just reporting to you.  I talk with everyone who works at Proteus about what I call this model of servant leadership. The more senior you are, the more you’re there to serve. You’re a tool for everyone else. Your job is to get them the resources,
whether it’s money or budget, or tools, or training, to get their jobs done. But you’re not there to gain control. That’s more and more clear to me. I’m the No. 1 servant.