How Corporate Culture Promotes Innovation
Yesterday's post about Apple's CEO succession strategy got me thinking about how corporate culture can foster innovation. In this case, Rambus came to mind. You may not be familiar with this silicon valley company, and if you are, it may have more to do with patent litigation than innovation.
Like a handful of successful companies, Rambus doesn't manufacture a product, but develops and licenses its technology to other companies. And no, it's not a patent troll. The vast majority of its technology is developed in-house for customers like IBM, Intel, Samsung, Sony, and Toshiba, to name a few.
And Rambus's engineers work tirelessly to develop high-speed memory and processor interface technology for a broad range of computing, networking, and consumer electronics products.
But what's unique about Rambus is a culture that values innovation above all else. How did it get that way? As with Apple's Steve Jobs, it starts with unique individuals:
- Entrepreneurial founders who knew their limitations as managers. While they continue to provide guidance as board directors, founders Mike Farmwald and Mark Horowitz - both Stanford University PhDs - stepped aside as executives three or four years after the company's inception in 1990. Horowitz is a Stanford Professor, while Farmwald is a serial entrepreneur who has founded six companies.
- Engineers with an almost fanatical passion for the technology. Nowhere on the planet will you find more engineers with an almost cult-like dedication to high-speed chip technology than at Rambus. For years, dozens of Rambus engineers worked hand-in-hand with counterparts from Sony, Toshiba and IBM to develop the high-performance guts of the Sony Playstation 3 game console.
- Seasoned senior management who incentivized innovation. The board chairman was industry icon Bill Davidow, the former Intel VP of sales and marketing and founder of venture capital firm Mohr Davidow Ventures. And Bill hired Geoff Tate - a former senior VP of AMD - to run the company. Tate had a "Knights of the Round Table" style of management where everyone had a voice. That bogged down decision-making at times, but it also empowered the engineers to speak up and take charge. Tate's favorite line was, "do the right thing."
- An environment that promoted communication and collaboration. Aside from innovation, senior management prized communication and collaboration above all else. Everyone - even Geoff - had a cubicle, so no doors ... except for conference rooms. Managers were encouraged to have weekly one-on-ones with staff members and periodic meetings with peers. And Rambus had extraordinarily effective management and planning processes for everything from goal alignment and measurement to business and strategic planning. You could set your watch by meeting start and end times.
- Respect for employees, their families, and the community. The company provided fully paid PPO health care for employees and their families, and every department was required to sign up for community service activities. Also, corporate headquarters was outfitted with state-of-the-art networking and automation technology, in addition to workout and game rooms, and free drinks and snacks. I could write an entire post about all the intangibles.