In Brief
- Over a year, I interviewed 19 Australian founders across 15 industries for my PhD research.
- I was trying to understand what made some workplaces hold people while others kept leaking them.
- The findings broke down into seven specific patterns.
- None of them involved perks, salaries, or HR programmes.
- They came down to purpose, team, structure, and how the business learned.
Between May 2018 and May 2019, I sat in 19 conversations across the kitchens, garages, sheds, offices, and cafes of Australian founders. The youngest was in his twenties. The oldest was past 60. They worked in 15 different industries — agriculture, aerospace, construction, computing, energy, food, healthcare, manufacturing, mining, telecommunications. Four were women. Fifteen were men. All of them were running small or medium businesses in Australia.
I was a PhD candidate at the time. The question driving the research was specific. What did some workplaces have that others didn’t — what made certain businesses hold their people through years of stress and growth, while others kept leaking talent no matter what they paid?
I expected to find answers in incentive design, HR systems, leadership styles. I found something different.
What separated the workplaces people stayed in from the ones they left came down to seven patterns. None of them were programmes. All of them were practices.
This post is what I learned. I’ll link to deeper material on each idea — the frameworks and concepts that came out of the research — for anyone who wants to go further.
1. They built around a real problem, not a revenue target
The first thing that came up, in nearly every conversation, was the problem the founder was trying to solve. Not the business model. Not the market opportunity. The actual problem affecting actual people that the business existed to address.
One founder, working in agriculture and food, put it as plainly as anyone in the research: “the thing that really matters is not so much the idea, it’s whether or not that idea is, once again, solving a real-world problem.”
In the workplaces where people stayed, this real-world problem was the gravity. Every team member knew it. Every team member could connect their work to it. The work had a why that didn’t require a slide deck to explain.
In the workplaces where people left, the original purpose had usually drifted into “hit the targets.” The team was still working hard. They just weren’t sure what for.
I called this pattern the Holistic Collective — the team gathered around a problem worth solving. When it was present, people endured the hard parts. When it wasn’t, they couldn’t see why they should.
Explored in more depth in Why your team doesn’t take initiative.
2. They hired for difference, not fit
The second pattern surprised me. The founders who built lasting teams didn’t hire for “culture fit” in the way most people use the phrase. They hired for difference.
What they wanted wasn’t agreement. It was challenge. One CEO put it this way: “you get answers from divergent mindset.” Another founder, when describing his team, said they were all from the same industry but “we all have slightly different skills and attributes and experiences.” Shared problem. Different angles.
The founders who got hiring wrong did the opposite. They hired people who felt comfortable. Two years in, they had a room full of agreement and nobody seeing the things they themselves were missing.
The strongest teams in the study had visible diversity in background, skill, and thinking — and absolute alignment on the problem being solved. This combination is part of what I’d later describe as the eight conditions for a workplace people stay in.
The phrase “culture fit” is one of the most expensive misnomers in hiring. It usually means “similar to me.” What you actually want is “shares the purpose, brings what I can’t.”
Explored in more depth in What Founders Get Wrong About Hiring for Culture Fit.
3. They stayed small for as long as they could
Almost without exception, the founders who built workplaces people stayed in were obsessive about keeping the team small in the early years. Not because of cost. Because of relationships.
One founder told me he interviewed people in his shed. Another worked out of his garage with his founding team. Several described being able to walk to anyone on their team in under thirty seconds. “The speed that you have is real when you are smaller,” one explained.
Small wasn’t a strategy. It was a structural choice that produced the kind of culture they wanted. When people sit in the same room, they ask each other things. They overhear context. They build trust through proximity, not through processes.
Founders who scaled too quickly described losing this. They described moving to bigger offices and immediately feeling the team fragment into silos. Some never recovered.
This isn’t a romantic argument against growth. It’s a practical observation that the texture of a small team produces something that’s hard to manufacture later — and most founders should fight to keep it longer than instinct tells them to.
Explored in more depth in Why your best people stop bringing ideas.
4. They paired structure with consideration
The leadership pattern that came up most often was something the leadership research from the 1950s had already named — structure and consideration.
Consideration was the warmth — caring about people’s lives, being flexible, respecting that work isn’t everything. Structure was the clarity — defining what the work was, what was owed, when it was due, what good looked like.
The founders in my research who built lasting teams did both. Not one or the other. Both, at the same time, often in the same sentence.
The ones who failed at retention almost always failed at one half of the pair. Some were warm but unclear — they ended up doing their team’s work because expectations were vague. One founder told me bluntly that his lead programmer had pulled him aside one day and said: “you had a chance at making a good company, but the place is filled with dead wood, you’ve been too nice.” That was the moment he realised consideration without structure isn’t kindness.
Others were clear but cold — their teams hit targets but quietly hated the place. Eventually they left.
This pair sits at the heart of the Model I vs Model II distinction Chris Argyris drew. The leaders who held both halves were operating in Model II — direct and warm. The ones who slid toward Model I — control without honesty, or warmth without truth — produced workplaces people couldn’t stay in.
Explored in more depth in The hidden cost of being a ‘nice’ boss.
5. They were honest about how hard it was
This is the lesson that surprised me most. The founders who endured weren’t the ones who pretended the work was fine. They were the ones who named, out loud, how brutal it was.
One founder, running an energy business, told me: “so it’s a lonely existence, it’s not an existence that’s glamorous. It’s pretty f***ing depressing actually.”
Another described the financial pressure: “how do you beg, borrow and steal the money that keeps you through the next couple of months.”
A third said he didn’t take a single holiday for his first five years.
The founders who endured did so not by being tougher, but by being more connected — to a clear purpose, to a team that depended on them and supported them, to a peer or coach they could be honest with. This is what Deming called Joy at Work. Not happiness, but the conditions that let people sustain the effort. Seeing how you contribute, having the structure to do good work, and being able to keep learning.
When those conditions held, people stayed. When they didn’t, no salary kept them.
The brutal honesty of the work was the thing — and the willingness to name it.
Explored in more depth in The real reason small business owners burn out.
6. Mistakes were studied, not punished
In the workplaces people stayed in, mistakes were treated as data.
One founder told me, “a fixable problem is not a problem. As long as it’s fixable, it’s cool.” Another publicly told his entire team that he had made the most expensive mistakes in the company by a long way — naming them, not as a performance, but as a statement of fact. The effect was immediate. People who had been protecting themselves started bringing forward concerns they’d been holding.
This is Deming’s PDSA cycle at the level of culture — Plan, Do, Study, Act. Every action is an experiment. Every outcome is information. At a broader level, the same pattern shows up in Argyris’ Discover-Invent-Produce-Generalise cycle, which describes how groups of people develop new knowledge over time. Both rest on the same insight — learning requires that mistakes be studied, not buried.
In the workplaces people left, mistakes were events. Someone got blamed. The system didn’t update. Six months later, the same kind of mistake happened to someone else, and the cycle repeated. People learned that being wrong was punishable. They stopped trying.
This is also the difference between single-loop and double-loop learning. Workplaces that only run single-loop — fix the symptom, apply the rule, move on — keep dealing with the same problems. Workplaces that can run double-loop — question whether the rule or the assumption produced the problem — actually fix things.
Underneath both is something Deming called Profound Knowledge — the realisation that behaviour is mostly produced by the system, not by the people inside it. Workplaces that fixate on the person never fix the system. Workplaces that see the system can change everything.
Explored in more depth in How to know if you’re solving the right problem at work.
7. They built environments where the truth could be said
The seventh pattern is the one that sits underneath everything else. The workplaces people stayed in had something most workplaces lack — the conditions for honest conversation.
This isn’t about being blunt. It’s about whether the system rewards or punishes telling the truth. In the workplaces people stayed in, truth-telling was structural. Regular meetings invited honest feedback. Mistakes were named, not hidden. Disagreement was sought, not managed.
In the workplaces people left, defensive routines had set in. People had learned what was safe to say and what wasn’t. Hard conversations had been delayed for so long that they couldn’t happen at all without an explosion. The team had developed a smooth, professional, polite skill at avoiding everything that mattered.
There’s a related pattern Argyris described — the gap between espoused theory and theory in use. The gap between what we say we value and what we actually do. In the workplaces people stayed in, this gap was small. People could see that the leader walked the talk. In the workplaces people left, the gap was enormous, and the team had learned to navigate it cynically.
Truth-telling, in the end, isn’t a personality trait. It’s a system property. You can build it. You can also crush it.
Explored in more depth in Why hard conversations at work go wrong.
What this means for you
If you’re running a small or medium business in Australia, the patterns above are reachable. None of them are programmes you have to install. All of them are practices you can start this week.
You can clarify the problem your business is solving and make sure every member of your team knows it.
You can audit your last five hires for difference, not just for fit.
You can fight to keep the team small a little longer than feels comfortable.
You can pair the next hard conversation with both structure and care, in the same five minutes.
You can be honest about how brutal the work has been, with someone who isn’t on your payroll, this week.
You can pick one recurring mistake and study it rather than blame it.
You can ask one trusted person on your team what they think you might be wrong about, and listen without defending.
These are not heroic moves. They’re small, repeatable behaviours that, across the 19 founders I studied, compounded into workplaces people actually wanted to stay in.
If you’d like a structured way to see where your business sits across these patterns, the workplace diagnostic walks you through it.
Twenty years of management research, distilled through 19 conversations with people running real businesses in Australia, comes to roughly this — workplaces that hold people are built on purpose, on the right kind of difference, on small teams that talk, on structure paired with care, on honesty about the work, on mistakes that are studied, and on the safety to say what’s true.
That’s the list. The hard part is doing it.
Who were the 19 founders in this study?
Why focus on Australian founders specifically?
Do these patterns apply to businesses outside of technology?
How can I tell if my workplace has these patterns?
Which pattern is most important to start with?
More from this series
- Quiet quitting isn’t laziness — it’s a workplace signal
- How to tell if your workplace culture is broken
- The hidden cost of being a ‘nice’ boss
- Why hard conversations at work go wrong
- Why your best people stop bringing ideas
- The real reason small business owners burn out
- What founders get wrong about hiring for culture fit
- Why your team doesn’t take initiative
- How to know if you’re solving the right problem at work
