Larry Kim’s leadership secret everyone should know.

September 11, 2017 - 6 minute read - Posted by

larry kim, leading from the top, retaining top talent

“I once worked at a company where the leadership was very aggressive, causing a ripple effect where everyone was very defensive,” Larry tells us.

“Employees were constantly looking to blame others when things went badly and were very reluctant to take risks.”

Larry Kim, as is all too common, once worked in a toxic environment with bad company culture. Since then, he’s gained some valuable insights on what it takes to build and maintain good company culture.

Today, Larry Kim is CEO of Mobile Monkey, Founder of WordStream, Inc. Magazine Columnist and Editor of Marketing and Entrepreneurship with over 200k followers. Since 2004, Larry has worked in SaaS, Venture Capital, Market Consulting and built his own entrepreneurial visions.

Back when Larry worked in this particularly negative company culture, he observed what ended up being “a vicious cycle that alienated productive employees who would eventually quit as a result of dissatisfaction.”

But the problem wasn’t that this company only managed to hire aggressive employees. New employees were actually unknowingly adopting this unproductive company culture from their leaders.

The influence leaders had on company culture stuck with Larry as he went on to build two successful entrepreneurial ventures and advise on countless more.

“Employees take cues from the top.”

When Larry Kim founded WordStream, he noticed new employees would show up wearing business attire but within a few weeks, it would devolve to cargo pants and flip-flops.

“But why?” we asked.

Larry had an unconventional leadership story to share with us.

He conducted an office experiment where he would dress in business attire, everyday for several months. The intention? To see how much he can change his company’s culture.

Sure enough, within a few months of Larry’s shift in office attire, the rest of the company gradually started dressing more formal again.

Larry realized that leaders can make define changes by demonstrating company values by example.

“Employees take cues from the top,” he tells us.

But at the end of the day, employees always hold the power to decide whether or not to take cues from the top. Employees that don’t agree with values demonstrated by leadership usually end up leaving the company.

“Culture is largely a reflection of the people you recruit.”

—Larry Kim

So while Larry discovered how to drive change with employees that shared similar values—by leading from the top—this approach ultimately didn’t retain all talent. Larry needed a way to recruit employees that fit the company culture from the get-go.

Retaining the best talent.

Retaining top talent comes hand in hand with how you recruit.

But what’s an effective way to recruit employees that are less likely to leave?

“As early as possible, it’s important to settle in on your company core values,” Larry tells us. “In this way, hiring managers can figure out which candidates are a good culture fit and we are more likely to retain top talent.”

Larry used this proactive recruiting approach at Mobile Monkey, following his time building WordStream.

He also devised a plan to keep these valuable employees engaged once they were recruited. Each department at Mobile Monkey nominated a member to represent them in an internal committee. This committee would go on to compile feedback from their departments in order to come up with engaging company activities.

This experience draws on one of the most important lessons Larry shared with us from his experiences of both culture successes and failures. As a leader, it’s important to lead from the top, but a sustainable culture is always employee driven.

Lead from the top.

You’re always going to be leading by example whether you like it or not.

“Serious leaders understand that both by design and default, they’re always leading by example.”

Michael Schrage, Researcher at MIT Sloan School’s Center for Digital Business

That being said, it comes down to your leadership style and actions that ultimately determine how you lead by example.

One effective way, as Larry advised, is making the change from the top because the rest of the organization is always taking cues.

Leading from the top has helped Larry build company cultures that lower barriers to entry to having the toughest conversations and making the change. Employees found their time at work much more fulfilling and stayed with the company because their leader continues to be a walking example of the expectations that have been set out for everyone.

It’s a journey that starts with you, the leader. Demonstrating from the top, what it’s like to work in your team that recruits top talent and ultimately retains them.

Next Read: How one company runs without managers.


Also published on Medium.

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