Four ways to create a successful distributed company

The technology industry has embraced geographically diverse teams; with easy access to the latest tools, it’s no surprise. But tools aren’t enough to make a distributed company productive. You have to use those tools wisely in order to create a high functioning team that ships the right features efficiently. Along with the tools, you need to get the human elements right.

When I asked about distributed teams on Twitter, the response was overwhelming. The responses were universally thoughtful about providing a conducive and respectful work environment for each team member. All had spent significant time thinking about distributed organizations, a few had written articles or podcasted about it and one is even writing a book on the topic. Many of those I spoke with highly advocated for distributed companies, seeing advantages not just for the team, but for the product itself.

“Having a distributed team means you can go home and know that someone is always online helping people out in the community or looking out for issues. Being distributed also gives you information on how to build your product.” says Guillermo Rauch, CEO of ZEIT. For example, if your team is in Denver, you test there, which may unduly influence the product direction. When your company is located in diverse geographic locations, you’re more likely to avoid locality biases which ultimately improves your product.

Even though it may be counter-intuitive, distributed companies can be incredibly cohesive. "When done right, distributed teams end up being closer together than those working in an office.” says Nickolas Means, VP  of Engineering at Muve Health.

Here are four tips to help you create a high functioning distributed organization. 

1) Start with culture

Just like co-located companies, all cultures of remote companies aren’t alike. There’s a big difference between a remote-friendly and remote-first culture. A remote-friendly team describes a company culture is open to flexible to members being located in another city from the company’s main office. These teams lean more heavily on traditional work environments which tend to favor face time, ad hoc decision making and  less defined use of collaboration tools. Unless you put in conscious effort, remote-friendly companies will actually have to work harder to create an inclusive environment where geographically diverse and co-located team members alike can flourish.

A distributed team or remote-first team consciously creates processes designed around a geographically diverse team. These company cultures are more likely to build structures that support multiple time zones and various work styles rather than assuming all team members act uniformly. At their best, distributed teams master asynchronous work by not only accepting difference, but by making it the norm.

Though some argue that remote-first and distributed are the same term, others advocate for the term distributed.  "Using the distributed team terminology is a useful way to remind people that we’re all on the same team. No one is remote when everyone is distributed. Everyone buying into it is important.” John Wulff, SVP Software Development at CUSO Financial Services. For some, the use of the term distributed  is about fairness to all team members, regardless of location.  

“Once you have one remote member you become a distributed organization. You can’t think about being partially distributed. It’s binary or someone will be left out. If you embrace one or the other you start getting exceptions.You need to be conscious about both. You can’t burden people in office when you think “remote first” or exclude those outside. It’s more about having parity for both.” says Juan Pablo Buriticá, VP of Engineering at Splice.

When it comes to distributed teams, you can't let culture get created by default; you have to take an active role in crafting it.

2) Use tools mindfully

Just because you have a slack channel doesn’t mean you’ve created effective communication channels; you have to create structures and spaces to help people be their most productive. This is where distributed teams have an edge over remote-friendly and co-located teams. Unable to rely on informal ways of working, distributed teams are forced to create processes and use tools mindfully in order to be effective.

"The biggest mistake companies make is not properly managing communication expectations. Where should communication happen and where does information live? Not getting that right could mean that your organization is set up for failure. Every time you add a person the lines of communication grow exponentially and new members may not know who to ask for what.” says Buriticá.

Make sure your people know where the work gets done, where the socializing gets done and where the general business chatter news occurs. At Splice, the team sets clear expectations about where communication happens so there are boundaries, hand-offs are clear and information is easily accessible. For the team at Splice, Slack is for gifs. Team members can miss anything that happens in Slack but email is important. Everything important they need to know will happen in email or Google Docs. Work happens in Bitbucket and Google Docs while bug management is handled in Clubhouse. The task doesn’t exist if there isn’t a ticket. “It’s easier for team members to understand scoping when there is a membrane or a barrier, projects materialize only when they exist in task tracking software.” says Buriticá

Distributed software teams also need to teach the rest of the organization how to interact with them. "Having a dedicated chat channel isn’t enough. You have to set standards for the rest of the company.” says Brandon Dimcheff, engineering manager at Olark.  Dimcheff set standards after other teams frequently jumped into the main development channel to report issues. Even if there was a designated person on call, the team found it distracting, interrupting their focus. To minimize distractions, Dimcheff created a dedicated on-call channel where interruptions are expected and only the engineering manager and the on-call person at the time actively monitor the channel.

Burnout is a big problem in technology. While there are many factors at play, tools can inadvertently play a big role. For example, the expectation to always be available on a chat channel can contribute to burnout and is largely avoidable. "Never make the assumption that people are always online.” says Rauch. This is where asynchronous processes really help. But it’s more than that, it goes back to the work environment you create. “You have to make it culturally ok to turn off Slack or put it in do-not-disturb mode.” says Dimcheff.

3) Build it into the selection process

Being distributed widens the candidate pool considerably so companies don’t have to limit themselves to those in close proximity; they can hire the best from all over the world. Still, distributed work might not be for everyone. “Not everyone is good at it. It’s a skill unto itself. For example, if you’re the kind of person who waits around to be told what to do you’re going to have a hard time with remote.” Says Matt Sherman, Engineering Manager at Stack Overflow. So too, extroverts or those who need a ton of people interaction may not flourish without co-workers steps away.

Simulate the remote environment during the hiring process to suss out whether a candidate might be a good fit for it.. "We don’t meet anyone in person. It’s all done over video and take home assignments. We also make sure to talk about remote throughout the process.” says Katie Womersley of Buffer.

While having worked remotely in the past may be a good indicator, it shouldn’t be a requirement. Instead, look for signals that a candidate might do well in this kind of environment. For example, during the interview process, look for those who tend to be flexible, able to collaborate and have empathy. "You’re going to deal with some inconvenience when working remotely, communication is harder, it takes empathy to do that.” says Means.

Finally, be sure the candidate has a quiet place to work from on a daily basis. This is especially important if this is their first time working at a distributed company. Means has found this can be as simple as asking, “Do you have a good spot in your house to work that has a door you can close?” This question can weed out people who lack a conducive environment and help the candidate to think more deeply about their potential work environment  before taking the job.

4) People skills and technical skills are equally important

Companies that are successful at being distributed recognize that the code isn't everything. While the code is the tangible output, it’s all too easy to miss the people behind it—especially when you can’t see them every day, eating lunch or doing other everyday activities. But missing the people would be a mistake. “Our most important focus has to be on people,” says Matt Stauffer, CTO of Tighten. “The actual code we write is much less important than you might think.” And the people side of things can get a bit uncomfortable at times, especially if your preferred communication style is more indirect. “Direct communication styles serve remote really well,” says Stauffer. "Indirect is much harder to decipher when remote. That means I need to be willing to have healthy conflict. As a leader, it is a discipline I have to practice: to swallow my discomfort in order to allow the other person to grow. If not, I'm harming them for the sake of my comfort.” But when you take care of the people stuff, it makes the code much easier.

Leaders at successful distributed companies spend time leveling up their people skills, rather than focusing on staying up to date on the details of the latest technology. "Prior to becoming a leader, all my time was spent leveling up my tech skills. Since then it’s been about leveling up my emotional intelligence and leadership. Work on your emotional intelligence. As a leader of a distributed team, it will take you further than the latest framework or knowledge.” Michael Eaton, who leads a distributed team at Quicken Loans.