By Jonathan H. Westover, PhD
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Abstract: This article explores how companies can maintain strong core values and culture as they experience growth and scaling of operations. While values provide important guidance in early stages, expanding teams introduces challenges to adhering to founding principles. Research shows values shape organizational culture and motivate employees, especially during uncertainty. However, scales present complexities like dispersed teams and reduced direct leadership oversight. The article discusses frameworks for thoughtfully anchoring growth within a foundation of shared values and purpose. Case studies of Patagonia and Zappos illustrate integrating values into aligned hiring, training, governance and advocacy at all levels. When exemplified and incentivized through visible leadership and coherent systems, values can strengthen culture as companies expand globally. With application of structures and practices, values can scale upward with business success over time.
As companies develop and experience growth, maintaining strong values and culture can become increasingly challenging. While core values help set the vision and direction of an organization in its early stages, scaling operations and expanding teams introduces new complexities that can threaten adherence to founding principles.
Today we will explore the paradox companies face when attempting to grow while remaining true to their values.
Core Values as an Anchor in Times of Change
Values represent the deeply held priorities and beliefs that guide decision making within an organization. Research shows that values play a crucial role in shaping culture and motivating employee behavior, especially during periods of uncertainty or rapid change (Collins & Porras, 1994; Chatman et al., 2014). As companies transition through different growth phases, maintaining a strong anchor in core values can provide stability and direction. When communicated effectively and visibly role modeled by leadership, values serve to unite dispersed teams around a shared purpose and way of working, even as business needs and external factors evolve (Cameron & Quinn, 2011; Sorenson, 2013).
Early Stage Values Alignment
In start-up mode, culture is largely defined by the founders' personal values and vision. At this stage, values are typically embedded in day-to-day operations through direct oversight and role modeling by a small leadership team (Wasserman, 2012). Hiring and onboarding processes focus on assessing cultural fit to establish a cohesive core team aligned with the company's guiding principles (Goffee & Jones, 2013). Regular communication keeps values front and center as the primary decision filter during early challenges and uncertainties (Collins & Porras, 1991).
Challenges of Scaling Up
However, maintaining close alignment between values and operations becomes more complex as the company scales. Expanded teams introduce varied backgrounds, viewpoints, and ways of working that can dilute a founder-driven culture over time if not intentionally managed (Sinek, 2009). Common pitfalls include over-reliance on compliance-based training rather than lived exemplification of values, increased bureaucracy that obstructs agility and risk-taking, and weak onboarding unable to properly socialize new hires (Wasserman, 2012; Chatman et al., 2014). Physical dispersion across offices further challenges cohesion and shared understanding of "the way we do things around here" (Schneider et al., 2013).
Anchoring Growth in Values
To successfully scale while preserving core values, leadership must thoughtfully navigate the tensions between expansion goals and cultural integrity. Various frameworks exist to guide leaders through this paradoxical challenge, rooted in principles of conscious culture building and management (Cameron & Quinn, 2011). Effective strategies include:
Clearly articulate the "why": Leaders reinforce foundational purpose and principles through ongoing communication of inspiring mission and values (Sinek, 2009).
Lead by strong personal example: Upper management visibly models values through day-to-day decisions and interactions to establish behavioral norms as team size grows (Collins, 2001).
Ingr ain values into systems and processes: Hiring, onboarding, reviews, rewards, and other human systems are designed to recognize and incentivize values-aligned behaviors for sustained socialization (Chatman et al., 2014).
Facilitate shared understanding: Interactive training and team activities promote discussion and consensus around interpreting values across diverse company divisions (Schneider et al., 2013).
Empower distributed leadership: Decision-making authority and accountability for values adherence are distributed to empowered mid-level leaders managing remote/satellite offices (Goffee & Jones, 2013).
When successfully implemented, these research-backed strategies enable a company's anchoring values to scale in parallel with operations as growth accelerates. Industry examples will now illustrate this balanced approach in action.
Patagonia: Scaling Sustainability
Outdoor apparel giant Patagonia has experienced explosive growth while strengthening its reputation as one of the most purpose-driven companies in retail. Founded on principles of environmental stewardship and social responsibility, Patagonia built a values-aligned culture under the leadership of owner Yvon Chouinard, who exemplified commitment to the planet through actions larges and small (Patagonia, 2022).
As the company scaled internationally, Patagonia ingrained sustainability deeply into hiring, operations, and product design through initiatives like its Common Threads recycling program (Patagonia, 2022). Annual all-company gatherings facilitated open discussion of interpretting environmental values across diverse business units and global offices. Patagonia also leveraged its brand influence, running ads urging consumers to "vote with your dollar" and advocating for environmental policy reform (Patagonia, 2022).
Through visionary yet tangible integration of ecological values company-wide, Patagonia established sustainability as core to its identity - even as sales multiplied into the billions. This balanced approach allowed values to strengthen organizational culture on an ever-expanding scale.
Zappos: Going Above and Beyond for Customers
Online shoe and clothing retailer Zappos grew from a fledgling startup to a $1 billion business acquired by Amazon while fostering a famously fun, supportive culture centered on extraordinary customer service. Founder Tony Hsieh led with core values of "delivering wow through service" prominently featured in hiring, training, and performance reviews (Hsieh, 2010).
As Zappos more than doubled in size, leaders reinforced values through systems like unlimited paid time off and transparent firmwide holacracy governance structure encouraging problem-solving across departments (Hsieh, 2010). New hires underwent intensive onboarding totally immersing them in delivering "wow" for customers (Hsieh, 2010). Extensive training, rituals, and social incentives also helped diffuse core values deeply as teams scaled, keeping service quality consistently superior despite rapid expansion (Hsieh, 2010).
Zappos shows how clear prioritization of values like customer obsession can strengthen rather than weaken as an organization grows, when supported by aligned systems, resources, and collaborative culture across levels.
Conclusion
Successfully navigating growth while preserving an authentically values-driven culture requires intentional leadership. Research illustrates the strategic importance of anchoring expansionary goals within a stable foundation of shared principles and purpose. Practical frameworks exist to thoughtfully scale values by exemplifying them from the top down, socializing them horizontally across teams, and incentivizing aligned behaviors system-wide.
Industry examples from Patagonia and Zappos demonstrate balancing this paradox in action. By visibly implementing sustainability and service values into aligned hiring, operations, community-building and advocacy at every level, these companies strengthened culture as they multiplied in size and global impact. For any organization, concrete application of structures, resources and collaborative practices can help values scale upward in tandem with business success over time. With values functioning as both rudder and rallying cry, companies can thrive financially while remaining devoted to their higher guiding purpose.
References
Cameron, K. S., & Quinn, R. E. (2011). Diagnosing and changing organizational culture: Based on the competing values framework (3rd ed.). John Wiley & Sons.
Chatman, J. A., Caldwell, D. F., O'Reilly, C. A., & Doerr, B. (2014). Parsing organizational culture: How the norm for adaptability influences the relationship between culture consensus and financial performance in high-technology firms. Journal of Organizational Behavior, 35(6), 785–808. https://doi.org/10.1002/job.1928
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Collins, J., & Porras, J. I. (1994). Built to last: Successful habits of visionary companies. HarperBusiness.
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Hsieh, T. (2010). Delivering happiness: A path to profits, passion, and purpose. Business Plus.
Patagonia. (2022). Our history: How Patagonia was built. https://www.patagonia.com/our-footprint/history.html
Schneider, B., Ehrhart, M. G., & Macey, W. H. (2013). Organizational climate and culture. Annual Review of Psychology, 64(1), 361–388. https://doi.org/10.1146/annurev-psych-113011-143809
Sinek, S. (2009). Start with why: How great leaders inspire everyone to take action. Portfolio.
Sorenson, S. (2013). How employees' strength use relates to their perceptions of organizational culture. Canadian Journal of Behavioural Science, 45(2), 125–133. https://doi.org/10.1037/a0027398
Wasserman, N. (2012). The founder's dilemmas: Anticipating and avoiding the pitfalls that can sink a startup. Princeton University Press.
Jonathan H. Westover, PhD is Chief Academic & Learning Officer (HCI Academy); Chair/Professor, Organizational Leadership (UVU); OD Consultant (Human Capital Innovations). Read Jonathan Westover's executive profile here.
Suggested Citation: Westover, J. H. (2024). Scaling Culture: How Values Can Grow With the Organization. Human Capital Leadership Review, 13(2). doi.org/10.70175/hclreview.2020.13.2.13
