RoundPegg Uses Web-based Polls, Services to Build Stronger Cultures

8/7/13Follow @MichaelXBD

Corporate culture is a tricky issue in the business world. Companies spend vast sums of money on consultants, surveys, and “Successories” motivational posters. Meanwhile, jaded employees roll their eyes when it comes time to take the annual survey or wisecrack their way through buzzword-filled HR meetings.

Both points of view are justified. Studies show companies that have a set of shared values throughout the organization really do perform better and have happier employees.

So there’s a need for fresh thinking about how companies define and change their cultures, and a new generation of companies are trying to fill the gap. One of them is RoundPegg, a startup based in Boulder, CO.

RoundPegg—remember the adage about square pegs and round holes?—has developed a set of online tools companies can use to discover what their employees value most, how well they work together, and what managers should emphasize. The software also promises to help identify problems as they arise and show which teams and individuals need closer attention.

Many companies and consultants promise to improve workplace culture, but RoundPegg thinks it has an advantage because its surveys are revealing and based on decades of social science research but are short and don’t place a burden on employees, RoundPegg co-founder and chief psychologist Natalie Baumgartner said. Baumgartner has a Ph.D. in clinical psychology and was a corporate consultant before founding RoundPegg.

If you’ve spent time in the corporate world, you’ve probably taken a long test trying to assess your personality, or have been given the annual employee satisfaction survey. RoundPegg’s surveys aren’t like that.

“What we do is identify what are the core values everyone in an organization holds using this brief, five-minute survey where you identify the values most important to you as an individual. We aggregate that data, and that’s what tells us how the culture is really functioning, regardless of the values on the wall,” Baumgartner said.

For example, on RoundPegg’s company culture survey, employees are given a list of 36 values. The list includes values like fairness, stability, informality, and risk-taking. They click on the nine most important and drag them into a list on the left of the screen. Then they move the least important ones to the right. They don’t rank the values or have follow-up questions, so the survey’s over in five to seven minutes.

Companies get the results back in a dashboard that lets them compare the values the bosses say are important with the values employees think are important. At the least, it’s a good reality check for management, because the latter is vastly more important.

“We know those values are going to drive the way your company functions more than anything else on a day-to-day basis,” Baumgartner said.

RoundPegg focuses on values for a few reasons, Baumgartner said. First, the values an individual has tend to stay stable over time.

“We rely on about five decades of personality research that tells us that our core values as individuals are pretty well hard-wired by the time we reach adulthood,” she said.

Second, asking employees directly about whether they’re happy or what the corporate culture is like usually isn’t very helpful. Opinions can change based on whether an employee’s had a bad day or a recent disagreement with a coworker.

“We don’t ask individuals to identify what they think the culture is, or what they want the culture to be, because we know that data’s fraught with errors. But that’s usually how organizations measure culture, up until now,” Baumgartner said.

RoundPegg also generates a score that tells companies how well aligned their values are with every employee. Scores can be tracked over time to watch for changes and to see if new initiatives are working, and the data’s much more useful than a thick report that comes in once a year following an annual survey.

Culture might sound nebulous and hard to define and measure, but it can’t be ignored.

“This is something that’s applicable to every organization out there. Everybody has a culture, whether they want one or not,” chief operating officer Brent Daily said.

RoundPegg doesn’t tell companies whether they have a good culture or a bad culture, but it can tell whether a company has a strong culture—meaning the company and its employees share the same values—or a weak one, Daily said.

RoundPegg also can identify which teams or offices within a company have strong cultures and help companies match values and a team’s objectives. Different departments can value different things—maybe the sales staff should be hypercompetitive, while product development needs to favor cooperation—and Daily said RoundPegg can help companies fine tune their cultures, or at least avoid a disastrous one-size-fits-all solution that ends up hurting everyone.

RoundPegg’s surveys can be used in a variety of situations. One obvious use is screening prospective employees, but RoundPegg also can assist with acclimating new hires, finding and fixing morale problems, planning and executing a reorganization, or integrating companies following a merger.

The range of applications is indicative of how powerful values are in the business world.

“When you look at the implications of all of this, it’s pretty staggering,” Daily said.

It also suggests RoundPegg could have a bright future. The company is a graduate of the Techstars accelerator program and has raised $2.45 million. It has 11 employees.

After rolling out a new product this summer, RoundPegg’s focus is on adding to its sales and marketing efforts to acquire more clients, Daily said. The company has more than 50 clients, including Kaiser Permanente and eBay.

The company declined to disclose details about revenues, but Daily said it has grown 180 percent year-over-year and the company expects 300 percent growth this year.

Michael Davidson is the editor of Xconomy Boulder/Denver. He covers startups, venture capital, clean tech, energy, aerospace, telecoms, and whatever else happens above 5,280 feet. Contact him at mdavidson@xconomy.com. Follow @MichaelXBD

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