Accelerate - April 2016

From Xero to hero

open this image in new window: Julie Reddish

Give people the space to express their own culture, and they will call themselves Cheese Weasels and thrive, says Xero’s Julie Reddish.

With 1300 employees across 20 offices globally, Xero is an unequivocal Kiwi growth success story. In less than a decade, the Wellington-based accounting software firm has doubled in size annually.

It’s gone from a handful of local SMEs to well over half a million users worldwide, reconciling $300b a year in transactions through the company’s “beautiful” cloud software.

So how do you keep the start-up mentality alive in a company where, among other challenges, their employees are working in seven different time zones?

Julie Reddish, Xero’s Happiness Engineer, works in the Global Product Team – where the developers make and improve the aforementioned beautiful software. It’s the guts of the operation, or as Reddish puts it “without a product, there’s no company”.

Julie Reddish

Julie Reddish

Reddish’s job is essentially free reign to walk the floors (actual and virtual) of Xero’s six product offices, listening, and acting on, the helpful suggestions, heartfelt grumbles and flights of fancy of 450 developers.

A company where “Happiness Engineer” is a job title tells you something about the prevailing culture. Other teams are named the “Cheese Weasels” and “the “Vampire Squids”, and Reddish stresses the importance of authenticity arriving at this point.

“A company’s values can be BS if they’re not authentic. Letting values sort themselves out at an individual level is best.”

The quirky team names, the ice-cream days and the ironic donning of suits on special occasions to talk about “synergy” and “moving forward” are the fruits of a group of people who want to work in a certain way, and are allowed the room to express that preference.

Listening to insights, be they via informal discussions, contributions to CEO Rod Drury’s regular “Ask me anything” sessions, or staff surveys helps ensure the inevitable growth in hierarchy doesn’t stifle the flow of ideas.

In the same way that market insights and an online user community ensure Xero stays on top of changing customer demand, the various antennae focused on staff issues (including Reddish) help keep the developers happy.

As Reddish points out, this is not necessarily out of an altruistic desire to create warm fuzzies; it makes business sense.

“Developers are hard to replace, and they can get work in a lot of companies. It makes much more sense to keep them.”

As for the tyranny of distance, that’s only an issue if you want uniformity across offices. Reddish doesn’t subscribe to that approach:

“As a head office, we can’t impose a mono-culture. We let each office own their culture.”

Which is not to say Xero is a series of city-states from Wellington to San Fransisco. The organisation is linked by five core values:

Human (real people making a difference in the world)

Beautiful (creating engaging and inspiring interactions with customers)

Challenge (using data and insights to stay ahead of changes in demand)

Champion (being a business partner who champions small business)

Ownership (each individual being accountable for their part in the company’s purpose)

The values as written are the embodiment of what the organisation’s 1300 employees want their workplace to be. They weren’t cascaded from above, but bubbled up from below.

“The values really say what you are as an organization. They have to be done authentically.”

Xero - Diversity

Xero tolerance: Xero makes a conscious and deliberate effort to increase, promote and celebrate diversity. They do this because they believe it is good for business, with Reddish referring to the Massachusetts Institute of Technology (MIT) study where they found the biggest predictor of team performance and success is an equal split of men and women.

Also helping to retain the culture of innovation as the company grows is the belief at Xero in the Holy Trinity of employee engagement – Autonomy, Mastery and Purpose.

In particular, paid time is routinely given over to allowing employees to explore their own ideas. As other software companies have found, this internal hack can often yield improvements, fixes and new products that may otherwise have never seen the light of day.

This all adds up to a company that has opened the doors in Australia, the US and UK, but retained the ethos and culture of an idea developed in a Wellington living room.

The level playing field | Index | Creating innovation cultures

Updated: 8 April 2016