002 - Case Study - WeWork - People

Mike: [00:00:07] Hello, and welcome to the BottomUp podcast. This is episode two of the BottomUp podcast. I am your co-host Mike Parsons, and as always, I'm joined by the man with the plan, Mr. Chad Owen himself.

Chad: [00:00:22] Hey Mike, and I just wanted to say thank you, listeners, for continuing to join us here on this journey into decoding and understanding WeWork. We've got part two of a four-part case study here. that comes straight from a case study that we've put up on the BottomUp.IO coursework. And, Mike, I’m curious,

if we couldn't just get right into the second P or people, and break down kind of, WeWork's successes and maybe failures when it comes to, people and their business.

Mike: [00:00:55] Totally well, much like the product side of the business that WeWork, the people side is a big tick. They got it right in a big way. And the interesting thing here is that obviously their employees were really happy up until very, very recent times, but there's a bigger learning in this, Chad, which is, and this is one of our tenants in BottomUp thinking, which is that great teams build great products. And,

if you don't have a great team, we really believe it is impossible to build a great product. And we've heard many great entrepreneurs talk about, the fact that if you want happy customers, then your customer support team need to be happy themselves. How can you imagine? Like calling up a call center.

And if everyone's very, very unhappy, there's no magical thing. that will instantly mean that they give a great customer experience. So, there is a direct, correlation. You may even say causation between great culture, great people, they make great products. And I think the story is what we have here with WeWork that the employees were really happy.

Don't you think Chad?

Chad: [00:02:05] Yeah. They certainly got, all of the benefits of working at a typical startup company. And I would say even beyond, all employees got perks, like insurance, wellness programs, unlimited sick days, which, I don't know many people have. And you know,

their work experiences would culminate in these, annual retreats that were often treated like summer camp.

I think they actually called them WeWork summer camps, but you know, places like Big Sur in California and, the coasts in England. And of course, with every startup comes your stock options and equity plans, that I'm sure you know, padded out to everyone's compensation packages.

Mike: [00:02:47] Yeah. And I think, the truth here is that. You've got to create great underlying wellness and culture in your organization. If you want to do big and ambitious things in the world. I mean culture and wellness are the things that keep everything together when it's tough. Culture and wellness are the things that when you face adversity, those are the things that get you through that stopped people quitting when it's tough times. and I think that the comprehensive nature of what they gave to employees was remarkable. Now, I think the lesson here is that you need great people in order to make great product. I think it's also fair to say that. You could argue with the unlimited cash that WeWork had for several years.

They were in a position to give so many perks. And so, I'm not going to argue that, but I think that the really positive learning here is if you take good care of folks, they will go out and build a great product. And I think we've established; they've got a great product right.

Chad: [00:03:48] Yeah. I think many of these benefits were even offered all the way down to people you know, that were, the community managers and people in charge of, operating and keeping the buildings going. So, this wasn't, things that were just offered to the leadership teams or management.

Mike: [00:04:03] Yeah, and so these benefits and perks. You could say, well, they cost a lot of money. But, if done in a proportional way, you can create really great sense of wellness. and Chad, you and I have just worked on a project with a client, which was all about creating employee wellness through design thinking.

And you can see how much people yearn to work in an environment that not only respects them and takes care of them but gives them. the benefits to have some sort of harmony in their life. And if you provide these things, it creates enormous loyalty, doesn't it?

Chad: [00:04:47] Yeah. And I think, my experience of people that are former employees, current employees, they have their own accord, have kind of created the WeWork family to support one another, both to find new jobs and opportunities within WeWork. But then when someone's ready to leave the company also, be very helpful

in, you know, going through their networks and being sure that they're also landing in a good place once they leave WeWork. And as you're saying, you know, these types of cultures, they don't just kind of happen by accident. It's very intentional and I think it speaks to the types of individuals and hard workers that WeWork has been able to recruit over the years.

Mike: [00:05:25] Yeah. So, one of the great ways that you can measure your company's culture and wellness is, doing some form of NPS, or net promoter score, asking folks how likely they would to recommend. the company to family and friends. And that can be a very good indicator of where you stand with culture.

So that's called NPS. I've done that several times in my own organizations or with clients. Very, very good. And in the case of WeWork, you can actually go to Glassdoor and there are hundreds and hundreds of reviews. Have been done by employees themselves of WeWork. And this gives you a really good, insight into actually what's going on in a company.

So, if you want to know how things are going inside of your company, this is a really good tool to use. The other thing you can do is, you know, for those of our listeners that are considering going to a new company, I would strongly recommend that you check out things like Glassdoor to see what people are actually saying.

The more informed you are about the environment, then I think it's all about your own empowerment there. And you can see here the recommendation rate. You can see an evaluation of the leadership, not only for, WeWork for thousands and thousands of, companies. I think this is an invaluable tool, don't you, Chad?

Chad: [00:06:49] I do, and one thing that we've maybe overlooked up to this point. But it would be remiss if we didn't talk about is the importance of the founding team and, or the founder, and leadership of the company. And I don't think anyone would argue, that there have been some issues with Adam Newman, one of the cofounders of WeWork.

And, so maybe lapses in judgment and good businesses stewardship, that has probably, likely led to, you know, some of the reasons why their IPO, was met with such resistance and skepticism when it was announced in August of 2019.

Mike: [00:07:28] Yeah. I think the founders bring so much to an organization, but the best teams that they put around themselves will be teams that not only do the things they ask but who will challenge them. And, I think there is perhaps too little challenge of Adam Newman too late. He's no longer with the company, but Chad, this time you've brought a great little goodie, a great little download, for our listeners.

Tell us a little bit about this very famous letter.

Chad: [00:08:02] Well it's been hard to find, things to bring, to share with y'all. Cause there's so much amazing coverage about, WeWork and what's been going on inside and outside of the company. But there were two pieces, both from the New York Times that I thought were fantastic to read, kind of in opposition to one another.

The first is, a profile done of Adam Newman by a reporter at the times, Amy Chozick and

It kind of lets you into maybe how he was left to his own devices. And as you said, Mike, not held accountable to and not challenged enough. Certainly, having a 15-minute meeting with, Masayoshi's son, you know, in charge of the vision fund, that led to an investment of almost, you know, four or $5 billion.

Like. That's going to bolster your confidence a lot. Just like, huh, I just have a 15-minute conversation with someone in charge of billions of dollars in, you know, they just decided to write me a check. and you know, with much power comes much responsibility, but there's also a story in the times.

About a group of, WeWork employees called the WeWorker’s Coalition, that wrote a letter to the management, really putting themselves, are distancing themselves from Adam. Even going as far as to say, we are not the Adam Newman's of this world. And so, I think, if we want to learn about how maybe people can go a bit wrong inside of an organization.

Reading these two stories. You really understand how disconnected, specifically Adam Newman, but other members of the leadership team, how disconnected they became from their people and not, you know, listening to, the will and the wishes of their people. And, you know, now they're trying to, kind of organize and save.

The great culture that they had inside of WeWork despite this, mismanagement at the top.

Mike: [00:09:54] So there you got it. You got two great goodies to follow up on this. If you're interested in that more cultural and team side. I want to, say though that I think the biggest learning here is that we do confirm that great teams do in fact build great product. But I do want to put a little caveat on this.

A great product is not necessarily mean a great business. So, there we got it Chad. that's the people side of WeWork before we run away. Yeah. What are the next two shows?

Chad: [00:10:27] So we're going to talk about the promotion side of, WeWork, and then cap it all off with, I'm sure, what all of your most interested to hear and learn about. And that's the profit side, AKA the business model side, AKA the vacuum that has imploded here in the past few months.

But yeah, you have those two shows to look forward to as we, continue that. We were a case study and. We'll have many more shows beyond that, including, shows, all from our design thinking masterclass, which is live now on BottomUp.IO where you can go and sign up for yourself to get that design thinking course.

This WeWork, case study and video form, and many, many other, materials for you to apply in your day-to-day.

Mike: [00:11:11] Well done, Chad. I think that's a great wrap. Thank you, everyone. That's another episode of the BottomUp podcast.