Culture Amp Turns Up the Employee Ownership Volume
11 April 2017 at 4:34 pm
Employee ownership is set to play a stronger part in growing the Australian economy writes Employee Ownership Australia Ltd board member Alan Greig.
Culture Amp – a leading Australian startup – is moving the employment conversation from “it’s your company” to “it’s our company” through shared ownership with its employees, and is reaping the business benefits as a result.
While employee ownership is becoming more familiar to us, Australia still lags behind our overseas counterparts in this area. For example, in the United States there are currently 10 million employee owners, with the National Centre for Employee Ownership there planning to raise that figure to 50 million by 2050.
Australia is starting to wake up to this global business trend and companies like Culture Amp, which are pioneering employee ownership, are raising awareness about its importance and the benefits it brings.
“Employee ownership is beginning to take off in Australia and startups like Culture Amp are leading this quiet revolution,” says Employee Ownership Australia (EOA) chair Angela Perry.
Perry says that she is witnessing growing political support from across the political spectrum for employee ownership, and with many companies now openly telling their success stories, the sector is getting stronger and is maturing.
This is evident in the recently released Employee Ownership Index which shows that those companies in Australia with substantial employee ownership well out-perform their non-employee owned peers on a range of factors including value creation, ESG factors and equal opportunity.
So, when Perry was looking around for inspiring employee ownership success stories to film, a company which was front-of-mind was Culture Amp, winner of EOA’s ESOP of the Year Award SME category in 2016.
This company develops culture and employee engagement strategies in companies so that they can sustain and grow business opportunities consistent with their purpose and values.
Culture Amp focuses on employee retention and productivity – the stuff that happy enterprises are made of and was one of the first companies to take up the new legislative changes and tax incentives for employee share schemes in start-ups (as related in the earlier Pro Bono News article Making a Start with Employee Ownership).
As a result, in the filmed interview with Culture Amp staff, the discussion is both inspiring and revealing.
In the interview, Rod Hamilton (co-founder and VP of product) and Douglas English (co-founder and VP of engineering) spoke with Perry about how their initially humble start-up went from 15 to 100 employees and expanded into three countries.
They say that employee ownership has been a key factor in assisting them to grow and thrive. Perhaps it wasn’t a huge leap for them to make because employee engagement is their core business.
Research says with a great deal of certainty that when ownership and participative management are combined, substantial business gains result.
The approach of Culture Amp has avoided the use of token employee bonuses more common in the industry. Why? They say that focusing on team building rather than individual contribution is the way to go. They have utilised employee ownership strategies to align everyone working at Culture Amp to the success of the company. They say that it’s a case of “‘the better they do as group, the better everyone does”.
Since the employee ownership structure has been in place there have been some real changes to company culture. Hamilton says the language has changed, from “well it is your company what do you think…”, to, now, “everyone owns part of this company, and the decisions we all make impact the outcome for the company”.
English talks about this in the interview – that company growth has meant that the founders have needed to step back and be “enablers as opposed to driving things”. This has, he says, “also had a big impact on allowing employees to feel that they have more control and ownership over what is happening”.
Employee education is particularly important because the concept isn’t that common yet in Australia. Hamilton says that it is good to explain what the employee share plan means when hiring new staff. However, in some cases English says that rather than being the focus for recruiting new talent it can be more important as a way “to keep employees” who are building up the business.
The bottom line for Hamilton is “the why” of employee ownership. He says that: “Fundamentally it comes down to we’re trying to build a very big audacious successful business and if we get the outcome we’re after, we want you to be a part of that”.
Perry says: “Our interview with Culture Amp tells us how company leaders can successfully move the conversation from an ‘us’ and ‘them’ to ‘this is all of us together’, owning and building up our business successfully”.
“With the old economic models running out of steam, employee ownership is set to play a stronger part in growing the Australian economy.”
Employee Ownership Australia is the independent peak body recognised by business and government and features a broad membership from startups through to large listed companies and employee owned cooperatives.
Culture Amp features on the program of EOA’s 2017 National Conference – A Real Sharing Economy: Employee Share Ownership at Work on Friday, 19 May.
About the author: Alan Greig is a board member of Employee Ownership Australia Ltd and a director of The Mercury Cooperative Ltd. He is coordinator of the Social Enterprise Legal Models Working Group.