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When software legend Mario Morino first started up the Beta Test of his MICS (MVS Integrated Control System) at the Parklawn Computer Center in Rockville, Maryland late in 1980, he most likely never knew it would lead to a life dedicated to the ideals of social transformation through the egalitarian spreading of the benefits of technology and the funding and support of major nonprofit and philanthropic institutions ranging from inner-city youths to the world-renown Brookings Institution.

A man passionately devoted to the enhancement of lives of all the peoples of the D.C. Area (plus many others across the Nation) through growth and innovation, Mario particularly enjoys sponsoring a venture startup support organization called the Netpreneur Exchange (www.netpreneur.org). Among many other services to the D.C. Area community, this organization, sponsored by the Morino Institute, is a nonprofit organization established to advance Greater Washington's netpreneurs and the businesses they create. Morino views the Netpreneurs as a community — both virtual and physical — where technology entrepreneurs can "connect, partner and help one another grow and succeed."

Mario himself is a software legend and success story ranking with those of Bill Gates and Larry Ellison, et al. In the 1970's heyday of computing, giant expensive mainframes dominated the field, and the Federal Government was their most intensive user. Time after time, data processing needs would cost the Government millions to upgrade and expand mainframe capacity. Owing to budget-busting pressures of the huge mainframe expansion and operating costs, many Federal Departments initiated projects in their computer centers to determine how CPU and overall mainframe services time was being used, by whom, and how efficiently. Armed with this information, they could adjust runs and prioritize needs on the basis of both qualitative and quantitative return-on-investment information. "Performance Analysis," as this activity was called, became a major function within these centralized data processing organizations.

At the time, there were a few odds-and-sods CPU and peripheral activity-measuring tools at the time, including MVS's own statistics reports useful in manually determining mainframe performance — but nothing that provided a comprehensive and satisfactory analysis and resource usage overview. Mario established Marino Associates, Inc., which developed an integrated suite of tools which could provide both comprehensive online monitoring of mainframe performance and publish reports. Numerical output from a running MICS suite could be fed into SAS (Statistical Analysis Systems, Inc.) analysis software and graphical display outputs for better communication with a data center's top management. Needless to say, MICS was a hit.

Morino Associates grew like topsy, and before too long merged into Legent Corporation, which was acquired in turn by Computer Associates. At the time of acquisition, Mario's personal holdings of CA equity was estimated to be worth over one billion dollars. About that same time Mario established the Morino Institute to do good works, one of which is the Netpreneur Exchange. Others include a number of nationally-renowned organizations including the National Commission on Entrepreneurship, the New Economy Task Force, the Community Technology Centers Network (CTCNet), Solutions for America's Advisory Councils, the PEW Partnership for Civic Change, and the Advisory Committee for the National Initiative to Promote Growth of Philanthropy.

Among the Netpreneur Exchange's entrepreneurial-boosting activities is a regular meeting of technology venture hopefuls and local venture capitalists called the Netpreneur Coffee + DoughNets Event. Captains of technology startups and venture capital firms get to mix in a pre-symposium coffee klatch and then listen and interact with successful entrepreneurs. With so many organizations and National figures requesting his time, it's amazing to learn that, at many of these Netpreneur events, Mario personally attends and speaks to the assemblage.

February 27th's event was no exception. Beginning sharply at 7:00 a.m. at the Union Station AMC Cinemaplex, the crowd, estimated to be between two and three hundred, raised a roar of ebullient confidence that made any serious business communication unlikely. For the most part, though, the budding entrepreneurs had a chance to swap stories and cards, and the venture capital firm partners — almost universally over six feet tall and wearing bankers' suits — could eye the swarms of fish, get a sampling of opportunities, and perhaps cop a few promising leads.

In the Netpreneur seminar that followed, moderator Jeremy Brosowsky, founder and CEO of Washington Business Forward magazine (www.bizforward.com ), hosted three up-and-coming entrepreneurs, namely, co-founder Caren DeWitt of WebMethods, Inc.; Andrew Hill, President and CEO of DevElements (www.develements.com), a young IT consulting firm with a staff of 27; and Matthew Pittinsky, Chairman and co-founder of Blackboard, Inc. (www.blackboard.com), a rapidly-growing eLearning company currently ballooning to over 400 employees. "Building a Winning Corporate Culture" was the focus of these speakers' talks.

This was followed by Morino's experienced and sage personal advice delivered on the same subject. Mario underscored the importance of a strong corporate culture high in integrity, mutual respect and dignity, along with customer- and employee-centered values. "Nurture your culture, or it will Eat You Alive!" was his lead key point. Mario pointed out that ultimately companies which are arrogant and draconian — and even those that occasionally express distain for their clients [might one include the past corporate cultures of companies like Oracle and Computer Associates on such a list? Hmmm? — Ed] — are likely to fail in the long run, particularly if they are startups. And it's no secret that Microsoft has demonstrated that it is "legally ruthless" [e.g., takes what it can get just because it has the size and power to do so — and consequently it's no surprise that many businesses, large corporations, individuals, States of the Union, and trade media sources are speaking out and taking action in response to certain of Microsoft's practices — Ed]. Mario contrasted that kind of corporate 'power' culture to that of SAS, which he characterized as benevolent, private, and customer-focused.

In his own practice, and as recommended to others, he banned the use of the word 'employ' — as in, "we should employ these resources to ... " or "we will employ you" as being disrespectful.

Morino likened the early establishment of good policy and a holistically wholesome corporate culture to the proper selection of the contents of a Petri dish — the type of the bacteria that will spring forth will depend on the food source provided [e.g., a hard coffee gel will likely grow fungus, while a swampy infusion will breed amoebas — quite a different culture! - Ed]. "Treat employees and customers alike with respect," he advised.

"Reinforce the behavior that supports the corporate culture you desire," he said. Morino stated that in large part, the "respect that was engendered" among employees, clients, suppliers, supporters, etc., led to Morino Associate's success. There are multiple cultures in an organization, and in particular, a good working relationship between the core cultures of technology and marketing is vital to the long-term success of the organization: the tech side and the marketing side need to respect and understand each other thoroughly, even though the other's culture may seem logically suboptimal relative to one's own business practices.

Key definitive points in Mario's speech are paraphrased and summarized as follows:

Internal culture must equal external culture: The same respect that is engendered with employees and backers must be practiced on customers and suppliers — and vice versa. "Consistency is the key. Every person in the company must clearly understand and be able to express the organization's vision and values. There should be no confusion or mixed messages, and there should be no difference between the external culture and the internal one. That doesn't mean, however, that culture is monolithic within an organization. Especially in mid- to large size firms, engineering or development teams, for example, will likely have different cultures than sales or marketing. That's okay, as long as they all share the same core values."

Hardship forces a retrenchment into survival mode — the groundwork of a good corporate culture will soon become evident as the organization either condenses into a enthusiastic 'one-for-all and all-for-one' spirit or rapidly declines into destructive who-struck-John and backstabbing. The organization not having a tough, spirited culture of integrity and mutual respect will not survive. "When things really get hard, you see how deep and how real they are."

Crisis is Opportunity. Problems that arise during the growth stages of a venture help all members of the company to develop practices, procedures, and patterns of human interaction that will enhance the corporate culture so that it is able to more easily handle much larger and more serious crises that will inevitably occur in the future.

Integrity of each employee — including yourself should be the first focus of building a winning corporate culture. Mario used the example of an employee he fired for proven sexual harassment who he subsequently fired from Legent when his company was merged with that company.

How you execute and reinforce your culture will precede you as a basis of your company's reputation. Culture is sometimes best expressed in the little things that you do for the customer or the employee, rather than in the sweeping mission statements so characteristic of bureaucratic organizations. Morino used as an example how — early on, when some who knew him felt this rule was a bit extreme — he insisted on a 24-hour contact rule: "Within 24 hours, respond to their question" whether customer or employee. He also demanded that any significant dialog or sales transaction with clients conclude with a 24-hour follow-up courtesy note. The simple acts of responding to phone calls and emails within 24 hours and always sending personal thank you notes are powerful, visible representations of an organization's operating principles.

Back up your corporate-culture "symbolism" with execution. Otherwise, both employees and customers will see through the B.S. and the engendered disrespect will soon result in flagging business.

Set expectations [e.g., get the word out to your employees and customers and set your management style] and understand who you are. When your employees and customers are involved in your vision and ethics, "you [addressing the crowd and the entire staff of a startup] will feel good about yourselves."

Avoid the temptation to set up an "Executive Row." This almost completely severs communication lines and lines of trust between management and those who are vital in information flows and who must create the company's output. The most competent, swift outfit is the one where the executives share the trenches with the troops. Keep the organization on a flat, egalitarian basis for as long as possible [i.e., until the organization grows to the point where geographic separation of offices and divisions makes this impracticable].

All parties must be onboard for the organization's Vision and Great Adventure — the competitive nature of a startup is not only the ability to create new services or products, but the ability to do so at many times the efficiency of established competitors. Hence, a tenet of the winning corporate culture must be that all employees and onboard supporters must WANT to work 80 hours a week in order to achieve both the organization's and employee's mutual goals. This would be an example of how the winning corporate culture is reinforced by hiring only those who can honestly subscribe to the venture work ethic of dedication.

Mario used the example of WebMethods, which quietly assembled a balanced team and delivered a meaningful solution to their customers — they "walked the walk" instead of just talking-the-talk. He also addressed a point made by Andrew Hill, saying that, "Companies are not families — one must fire without regret when necessary, and that's something you don't do [or would not want to do, in most cases! — Ed] with family."

Lastly, on the subject of managing the employment process, Morino made reference to the Tom Peters series on corporate culture within organizations and management — e.g., in the book Brand Me — Brand you 50, Peters discusses how a personal message, not a product, can give one a competitive career advantage.

Prior to Marino's talk, the three guests related their startup experiences having import in establishing a winning corporate culture. Caren DeWitt lead off by recommending, "Don't talk too much about stock options if you're interviewing with WebMethods," referring to the culture established early-on. The candidates who dwelt too much on a hefty stock-option payoff indicated clearly to the WebMethods crew that they just "probably weren't for us. This was not about making a fast buck, it was about creating a company with long-term value."

That principle was but one of the key elements of the company's philosophy developed during the early days when webMethods was a basement startup comprised of just Caren and her co-founder (and husband) Phillip Merrick. Maintaining the type of winning corporate culture per their design over a fantastic growth curve stretching from two employees to 1000 in six years time was no mere accident — and she provided insights into how they were able to accomplish this feat during the course of her symposium talk. DeWitt represented the "established company" view — from startup to payoff — of building a winning corporate culture. WebMethods, then, is representative of the high end of the startup-venture growth curve — and the Netpreneur symposium's panel of entrepreneurs and startup chieftains represented the various stages of growth spreading right across the entire spectrum — from seed-capital stage to maturity.

"Before there was even a real business called WebMethods, we spent as much time talking about what the company would be like as we did talking about who we would target for early investors and early customers, what the product would be like, and how we would solve customer problems," she indicated. During the time that she and her husband formulated their master plans for the company in Melbourne, Australia, they spent many nights walking the beach and thinking, "What would the company be like? How could they solve the customers' problems? What would happen if the Board became opposed to [the strategies advanced by] the Management Team?" — watch out!

Advice they received from Gene Rickers, formerly a partner at Shaw Pittman and now a principle of the FBR Technology Co. — a renowned local venture capital firm — proved invaluable: Keep your winning corporate culture infused with high levels of integrity. And as for the culture of persistence, she quoted Margaret Meade: "Never doubt that a small group of people can change the world." In developing formalized policies and procedures for Human Resources, as well as in establishing rules for customer relations, DeWitt stated that, "We derived nearly every important principle from the Golden Rule."

Andrew Hill's principle thesis was that in establishing DevElements, corporate culture was the reason encouraging its formation. Hill explained this as follows: "After years of being an employee and a consultant to various companies, I found myself constantly frustrated with the environment. Customer service and employee satisfaction seemed to be more like buzz words than part of the core values of the companies." According to Hill, employee retention leads to customer retention, and this requires putting a strong emphasis on inspiring shared cultural values and personal commitment for all DevElement employees. Hill noted the people he hired were "the people that we wanted to hang out with. They were not only excellent at what they were doing technically, but they were the people we were most likely to be seen hanging out with on the weekends."

For startups, intangibles like culture often take a back seat to more immediate survival issues like customer acquisition and capitalization. It shouldn't, according to Hill. "In a small business the wrong personality can be poison. If you're a candidate coming into DevElements, you'll interview with four different people, and they're looking at a lot more than just your technical background, they're looking at whether or not your personality is the right fit."

The most-well-elucidated strategy for corporate culture came from Matt Pittinsky, Chairman of Blackboard, Inc., an eLearning company. Matt's view is that a company's culture will either support its success or hamper it. Pittinsky likens it to product branding: "We're always cognizant that what makes us interesting is not the products we sell today, but the client relationships and the trusted brand. It's how we answer the phone, how we sell, how we describe ourselves to our neighbors. If we're able to describe ourselves in a way that shows investment in our clients' success, we build that relationship, and it's going to have to be at the core of everything we do."

Matt pointed out that the element of a winning corporate culture that was most paramount to the success of Blackboard was the client relationship. "Invest in your clients," he said. "Invest in their relationship, in their happiness, in every aspect of what they need and what they do." He pointed out that education related to the Internet was an $80 billion industry, and just 10% of 10% of 10% of market share would pay off quite handsomely — so success in satisfying client needs, be they product, service, or via mutual education — would ensure business success. Pittinsky pointed out that many of his current clients were newly experimenting in the field of using the Internet for a wide variety of educational activities, so that a strategy of playing "the multiple product game" — try this, try that — was far more appropriate for clients like universities who needed and demanded respectful, intellectual, and innovative program-developmental services — as opposed to saying, 'Here's our technology product, buy it or forget it'. In summary, it was not the product that made the success, it was the winning corporate culture of recognition, attentiveness, and respect accorded the clients.

Blackboard, Inc. co-founder and Chairman Matthew Pittinsky offered these five elements building a winning corporate culture:

Realize The Power Of The Pitch. Describe what your business is about and how it's going to transform the world. People need to clearly understand who and what you are, and this is true whether they are employees, customers, funding capital providers, or partners. And they should all understand it the same way.

Know Your Industry. The desire to be rich isn't enough to make a company successful, or to hold it together. You and your staff need both a passion for and understanding of your industry.

Stay True To Your Business Model. Be open to suggestions from advisors and flexible in your response to markets, but your core business vision and core values are tied closely together. Know the difference between adapting and selling out, and don't let conflicting advice cause confusion and drift in your company. Sell software (custom, et al) and then follow with services — which you can only do if your corporate culture has lead to a good lasting, long-term relationship.

Never Underestimate How Much People Are Willing To Help. People have a wider variety of skills, contacts, and experiences than their resumes show. Create an environment where employees feel encouraged to contribute broadly. Capitalize on their strengths, and leverage their networks of friends, colleagues, and advisors.

Above all, Let Information Flow. Communicate regularly, in meetings, in emails, in hallways, in whatever ways work for your organization.

Matt's view is that new managers, especially, must share the company's culture. This could become ever more challenging as one begins dealing with people coming from different industries, where strategies and values can be radically different. It's particularly pertinent when assessing potential candidates coming from large, bureaucratic organizations — behavior patterns may be at odds with the entrepreneurial spirit. Owing to the relative mix and cultures of people added to a venture's workforce as a result of acquisitions, additional strains can also be put on the organization, requiring careful efforts in attaining cultural integration.

In response to a question related to using a winning corporate culture to encourage venture capital backing, Matt noted that there is "no way to tell" which venture capitalist would bite, so it's necessary to go through the motions with as many as are needed — though he did say that early and rapid initial capital funding would most likely come from Angels — individual investors who take a flyer on a fresh, new startup. In fact, he pointed out that his dentist was one of the earliest and largest backers of the company, and was also one of the wealthiest people he knew.

The panelists agreed that culture grows organically. It can't be controlled, but it can be molded by the founders and executives if they stay true to — and execute — the principles they espouse. In his wrap-up to the session, Mario used the word 'nurture' to describe the process of building a corporate culture. The way to nurture a culture, he said, is through "example and execution, by what you do day in, day out."

So, despite the fact that the average American might not put 'corporate culture' at or near the top of the success requirements list for new high-tech startups, the consensus of those who have been-there-and-done-that is that few aspects of organization-building are as important. WebMethod's Caren DeWitt expressed it this way: "What I've learned over the past six years is that the culture is the most important thing you have. You need a clear understanding from the outset of who you want to be and what your company is going to be like. It affects everything from the people you get involved in your company to the companies that you choose to accept venture capital from."