How to Change Direction -- But Stay Together

By: Cheryl DahleWed Dec 19, 2007 at 8:37 AM

When WebTV was acquired by Microsoft, the company's founders worried that they'd lose their close-knit team in the process. Four years later, more than half the original employees are still with the company. Here are the secrets to keeping your best people on board despite choppy water.

Honor Your Roots

To help maintain a unique WebTV culture after being swallowed by Microsoft, Bucher and Goldman made it a point to share the company's startup history with every employee. Both men believe that it takes more than stamping a mission statement on the back of a name badge to get people to understand and revere a company culture.

Each new WebTV employee attends a new-hire orientation where Goldman, Bucher, or another member of the executive team shares stories. Those tales might recount the early days in the garage, the first product release, or even the company's debate over whether to try for an IPO. The session contributes to a shared legend and history -- an idea reinforced by artifacts like the framed original project-management chart outside Bucher's office or the case for the souped-up old computer that held the original prototype for the product, which Bucher carries around by a brass handle screwed to the top.

"We make a constant effort to touch people personally with the story of the company and how it faced certain challenges," Bucher says. "Our history is present in day-to-day conversations here. You really know what you've gotten through when you hear new people repeating stories about events that took place before they joined. That's when you've reached the point of collective history."

Make Trade-Offs for the Right Reason

Many of WebTV's employees were understandably anxious at the prospect of being acquired in 1997. Instead of dismissing those fears, leaders tackled them head-on and acknowledged some of the downsides of becoming part of a big company. But they also were able to describe compelling advantages that helped people understand that the trade-offs were made for good reasons.

"We had great concerns about joining Microsoft," Goldman says. "It seems that the media always casts Microsoft as the evil empire when it's doing things well and as inept and malicious when it makes mistakes. The scrutiny associated with that is overwhelming.

"But we believed that Microsoft was the only company in the world that could acquire WebTV and improve it. We knew Microsoft was committed to the consumer-TV market and would build its internal business division around WebTV. The company delivered on everything it promised -- and more. It's funny. At the time, we were so worried. And now we've been part of Microsoft for longer than we were a startup."