Corporate Culture Tips From the Young and the Restless

Last Updated Aug 17, 2010 8:35 PM EDT

Corporate culture has always been a critically important success factor for entrepreneurial companies. But it seems to me that it's never been as front and center as it is now, among a new crop of young CEOs who lack patience with traditional hierarchies and are seeking to create the kinds of workplaces where they and their peers feel inspired and motivated. At the Summit Series DC10 Conference, a high-powered event organized by young entrepreneur Elliott Bisnow, I had the pleasure of attending a panel discussion about great corporate cultures at companies run by CEOs in their 20s and 30s. Here's what we all can learn from them:

Zappos. "Think about what your values are, formalize them, and then hire and fire based on them," said Alfred Lin, the COO/CFO of online shoe retailer Zappos, which was recently acquired by Amazon.com. All candidates are interviewed by the team that they'll work with to determine if they'll fit in with the culture. And every new hire learns the company's core values and then spends time doing customer service on the phone and packing boxes in the distribution center. "It doesn't matter if you're an engineer or the general counsel," said Lin. If packing boxes and answering the phone is beneath you, you clearly don't belong at Zappos. In fact, CEO Tony Hsieh will pay you $1,000 to quit a week or so into the training period. The rationale: the right employees will stay and the others will bail out.

Linden Lab/Second Life. CEO Philip Rosedale, creator of the virtual world, Second Life, talked about his company-wide software system that allows employees to send "love messages" to one another to "replace the abundance of negativity in a business context with positive messages." Okay, it sounds a little flaky, but Rosedale says it's great for morale and is also used to evaluate employee performance among his staff of 400. Employees choose their ten favorite messages to compare publicly with their peers. The company also has what some may consider a radical method of distributing bonuses: 30% of total compensation is determined through "crowdsourcing". Once the total bonus pool is determined, says Rosedale, "we give everyone in a work group a little piece of software so that they can give money to anyone else in the company. That results in a perfect curve in the way people get compensated and it's stress-free."

CollegeHumor. "We always front-load on talent," says CollegeHumor co-founder Ricky Van Veen. The web-based company seeks out talented humor writers when they're college freshmen or sophomores, and then may hire them for internships when they're juniors. By that time, Van Veen knows if they fit in well enough to be offered full time jobs. Then, he says, "we make an effort to take entry level employees and give them tasks that they can step up to." To foster a spirit of communication and idea creation, the company uses chalkboard paint so that employees can scribble or draw on the wall whenever they're inspired. CollegeHumor also allows employees to work virtually if they choose. But it's not a totally freewheeling culture. "Everyone has to reply to all internal emails before leaving for the night," says Van Veen, since a delayed response may slow down a new creative initiative.

How important is corporate culture to your company? Tell us about the creative ways you communicate your culture and your values to employees.

Zappos lobby image from Flickr user EricaJoy, CC 2.0