entrepreneurshipresource center

The Resource Center has all the info you'll need From content to user feedback, the resource center has the information you need for every level of the entrepreneurial process.

Entrepreneurial Culture: What They Do Teach You at the Fortune 500

Rick Krska

At a Fortune 500 company, where I worked for a decade as a machinist and then as a supervisor, I used to be dismayed when the top brass toured the factory. A "row" of executives would wend its way through, never asking to be introduced to any of the employees. Nor did supervisors take it upon themselves to make the introductions.

That was something I vowed to change when I founded my own company, Laser Cycle Inc., in 1992, shortly before I was laid off as part of a "downsizing." These days, when visitors tour, I make it my business to make introductions. At every stop, I say something like, "This is Tom, who's in charge of shipping. He's a real asset." I firmly believe that such steps create a "culture" that says to employees, "You're important here."

At the same time, I believe there were qualities about that major corporation that I wanted to incorporate into Laser Cycle. One was my former employer's insistence that its products be manufactured according to specifications that were precise in the extreme. That attitude went a long way toward assuring top quality. Another was its ability to integrate and utilize a diverse work force.

In creating Laser Cycle, I could see that my experience at a large company would better equip me for the job of being an entrepreneur. What they do teach you at the Fortune 500 is critical when it comes to building a fledgling enterprise--both for enabling you to see what you should keep and what you should discard.

From having worked at the type of company that gave the business world the buzzword "corporate culture" a decade or so ago, and from having been a part of that culture, I was better able to formulate its small-company counterpart, namely "entrepreneurial corporate culture." What follows is a discussion of what I took from my past experience, and what I left behind, when I founded Laser Cycle.

The Good

In just five years, Laser Cycle, which I started with my wife in our suburban home, has become an enterprise with annual sales of $10 million and 80 employees. This in an industry--we remanufacture used cartridges for laser printers and facsimile machines, a less costly alternative than new cartridges--that is only 13 years old and still dominated by mom-and-pop operations. That we made it so quickly into the ranks of the top 15 providers (out of 7,500) is a testament to my years at a large corporation. There I learned...

Precision in Manufacturing. Making sure that each step along the manufacturing line is executed correctly makes for a quality product. That, in turn, makes for satisfied customers and repeat business. At my former employer, which serves demanding government customers, a process instruction that, say, called for mixing a formula for two minutes didn't mean one minute and 45 seconds. An instruction that specified, brush the felt this way, didn't mean brush it that way.

At Laser Cycle, we've incorporated this thinking into our manufacturing, winning the respect of a growing roster of customers, some of them major corporations. In our industry, the barrier to entry is so low that inconsistent quality continues to be a major problem, even after 13 years. Thanks to my days at a big company, this is a problem we don't have.

Respect for a Diverse Work Force. As an employee of a large company, I learned quickly to work with people who weren't white, male, or between the ages of 20 and 40, who weren't native-born U.S. citizens, and who came equipped with widely divergent temperaments and skills. If I hadn't, I wouldn't have been able to get the job done.

I also learned the value of providing training for such a work force,one that is likely to become even more diverse. I discovered the wisdom of taking every worker's employment seriously, and of not making snap decisions or overreacting to anything one person said.

These lessons have served me well at Laser Cycle. Recently, one of our best team-oriented managers refused to work with an engineer whose expertise was needed to solve a problem. The engineer, admittedly, has a healthy ego, and comes up short in the humility department. But I tried to say to the manager, "Play up to his ego if he can help you. We're all good at some things, and not others."

The Bad

What I didn't like about my former employer--and didn't want to bring to any company I created--largely involved the treatment of people. Apart from that admirable tolerance for diversity, there was a lot not to like about the Fortune 500 way. I've already mentioned the lack of regard for employees displayed by top executives, who didn't seek introductions when touring the factory.

What I also didn't learn was...

Trust for Employees. At Laser Cycle, we trust our employees. We don't ask them to punch time clocks. We expect that any adult employee who has to leave work for two hours to renew a driver's license knows enough to make up the time to get the job done.

If that sounds simple, it isn't. Consider one of my favorite morale-busters from the human-resource manual: the company's policy of offering a three-day bereavement leave for deaths of close family members -- only to require a signed note from the funeral director! Enough said.

Reward for Performance. It would gall me to see a top producer on the line working side-by-side with someone making the same money but doing nothing. The I've-put-in-my-eight-hours mentality is not the way we operate at Laser Cycle. Not only wouldn't I ever tolerate such behavior, but I'm committed to rewarding the flip side of it.

While Laser Cycle offers bonuses, raises, and profit-sharing for all as a way of recognizing the "team," I am also able and willing to do a lot more for top performers. And I usually do it even before they ask. I awarded one manager six raises in one year, although he hadn't made a single request for more money. I gave an executive a trip to Europe for two, and another a hunting rifle I knew he wanted.

In another instance, I called into my office a data-entry clerk who hasn't ever made a mistake, even though she handles detail-laden tasks day in and day out. I said, "It's been a pleasure to have you here, you're a real asset." And I gave her $200. Getting teary-eyed, she said: "Rick, never, ever has anyone told me that."

The Bottom Line

It doesn't always go smoothly. Last year, I was concerned that the "entrepreneurial corporate culture" that was evolving at Laser Cycle needed to be tightened. So we installed new software that helps people be more accountable. I sought outside consulting help for dealing with employees who had been with the company for a long time but hadn't grown with it.

Yet this is fine-tuning. The bottom line is that building a company involves creating a culture. An "entrepreneurial corporate culture" serves its owners and employees best when it contains the right mix of tactics. Some of what they do teach you at the Fortune 500 should be a part of that mix. And some of it should be recast.

comments powered by Disqus

Search the Resource Center

Stay Connected

Email Newsletter Signup

Want to get connected? Sign up to receive regular news, polls and updates from The Kauffman Foundation.

Email Newsletters

Want to be up-to-date with the latest news and updates from Entrepreneurship.org? To subscribe, just give us your email address below; you'll choose which e-newsletters you'd like to receive on the next screen.