RoundPegg is based in Boulder, CO, and prior to having two little kids I could usually be found riding my bike somewhere in the mountains when I wasn’t working.
What made you get involved in trying to develop a HR service?
People. They are the most important part of any knowledge business and yet executives are often too quick to rely on antiquated management philosophies to drive performance.
As both a culture and baseball analytics nerd, I wanted to bring a different approach that combined psychology and analytics. Fortunately, I met Natalie Baumgartner and Tim Wolters who were experts in both, respectively.
There is no harder problem to solve than how best to get people to work together. It’s a fun challenge, but one that has always felt squishy. There needed to be a way to quantify it and proactively drive it so culture would warrant air time in the board meetings instead of just in the pages of the trendy business magazines.
HR controls the biggest lever businesses have to drive the bottom line. It’s an immense responsibility and we wanted to create something that could make that both possible and simple.
What is the elevator speech on RoundPegg?
RoundPegg allows companies to manage culture via social software applications that ensure employees are hired, developed and engaged in alignment with the unique company culture.
So let’s dig a bit into the details! There are a ton of cultural models out there – tell us about yours. What makes yours better?
There isn’t much that is the same as the other models. We think that makes our solution better, but we’re biased.
RoundPegg is not just a diagnostic tool but also a suite of applications that provide specific approaches to manage culture depending on your company’s values.
RoundPegg is not prescriptive. There is no such thing as a good or bad culture at the macro level (note: there are good or bad cultures for us individually).
If you sell shoes and clothing we aren’t going to tell you that you need a culture just like Zappos. WalMart also sells shoes and clothing and makes a pile of money in the process. Yet you’d know which was which within three seconds of walking into the building. There is more than one way to create successful cultures. We help companies align their culture so everyone is pulling in the same direction.
RoundPegg measures values that are stable in all us humans by the time we reach adulthood. Therefore, you don’t have to re-survey every year and undertake a massive company-wide effort.
We’ve employed social networking functionality to allow colleagues to connect with one another to get customized actions in order to work better together. This helps the initiatives stick as well as provides an easy first level of triage for conflict resolution (we’ve heard this free up 6-hours a week for one customer).
Hiring to multiple layers of culture fit – to the company, team, and manager.
How best to engage is different for everyone. In this respect, RoundPegg is able to get prescriptive on the best ways to engage teams based on their cultural values.
Culture initiatives usually lose steam because progress can’t be measured in order to sustain efforts. RoundPegg provides real-time dashboards to track the culture movements as employees come and go.
Given you do a 5 minute survey of the employees to baseline the culture – does this create any sample bias questions (e.g. response rate by departments, age, etc.)?
Every department will have their own unique sub-culture. The goal is to ensure that all departments share the same limited set of core values. But, ultimately, your R&D department will be different than your Sales department in terms of other values that are important (or at least they’d better be).
Have customers ever been surprised by the results of the initial Baseline? Can you share some anecdotes?Additionally, sample bias does not creep in because everyone in the company is surveyed because everyone contributes to the culture. We typically get an 80 percent response rate, which is strong enough to shine a light on the culture in every corner of the company.
Our first cut of the data is to look at how the executives are wired versus the rest of the company. Most people, executives included, are often surprised the values they find important (those ones that are “obviously important”) are not shared by others.
The biggest surprises usually come from the fact that the data uncovers the reasons for the angst executives are feeling. RoundPegg has been called everything from magic to witchcraft.
You have a really interesting approach to include this in the recruiting system to use for screening candidates. So let’s tackle the legal worry first – how do you address adverse impact concerns? Have any of your clients been audited and has your solution passed the audit?
Any culture management system must be applied to the hiring process because 89 percent of an employee’s success is attributed to how well s/he fits with the company’s culture, the team’s sub-culture and the manager’s values. It’s critical to understand that fit on all levels.
With regard to the legalities, RoundPegg clears the required hurdles put forth by the American Disabilities Act, Title VII, Uniform Guidelines and adverse impact. Amongst other components, RoundPegg has tens of thousands of data points underlying the culture survey and is able to properly adjust based on the skew and kurtosis of the response distribution.
If a company is in the midst of a cultural change, do you recommend they use your solution?
Culture change is one of the biggest reasons companies approach us.
After executives have identified the aspirational values we are able to easily tune the culture platform so all the applications adjust to start the process toward shifting and aligning around those values. Depending on how far the aspirational is from reality, the longer it takes, but it can be done.
Describe your optimum client.
Every business has a culture whether they pay attention to it or not. But the best customers are ones who understand that hope is not a strategy, and that they must play an active role in driving the culture. Our software’s role is to scale great HR leaders.
While we work successfully with companies of all sizes and in all industries, we find the ability to move the needle best with companies employing 500 or more FTEs.
Does your solution have any constraints (e.g. international, languages, etc.)?
Our software is currently being utilized on six of the seven continents, in English only. Internationalization is on the roadmap, but not currently available.
Otherwise, the only other limitation we’ve run into is working with companies that still mandate employees use web browsers that are better suited to be on display in museums.
Last question: What is your coolest success story?
We, of course, eat our own dog food.
This is cheating, but it’s one that I’m most proud of because only one employee has left RoundPegg in the past three years. He went to start his own company so there’s an asterisk to that ‘loss.’ Based on the feedback from employees we’ve earned WorldBlu’s Best Place to Work award.
The best customer success story is with a company that was seeking to change their culture to one of accountability. After providing the survey we found they had what they desired, but that they had a conflicted value around rules. Half saw them as important, half not. The analysis showed that every attempt to put structure or process in place was being rebuffed by half the organization.
They have since managed to shift the culture to one that is more rule-bound, and thus accountable, via our application suite.