Lessons on Corporate Growth and Culture from the American Civil War

In the early years of the war (1861-1863), all soldiers were volunteers. They were paid a salary to serve, but they were there because they had chosen to join. By the later years (1864-1865), drafts and bounties had to be introduced. Bounties in the Union states went as high as a thousand dollars. Draftees also had an option to pay a commutation fee to avoid serving. All of this meant that the type of solider serving changed considerably in the later years.

In the beginning, privates and officers from the same hometowns served together. They knew each other, and leadership was informal. Officers handled decision-making, but authority only existed by informal mutual agreement. Discipline was rare, but likely also rarely needed. Those who were serving were driven to support a cause. They were able and motivated to serve.

Those who joined later were much more likely to be poorer (the bounty being the main draw), unmotivated (especially those were drafted), or criminals (who would take the bounty under a false name, desert at the first change, and then re-enlist for another bounty). Draft officers, desperate to meet the growing army’s need for recruits, would snare new immigrants at the waterfront or pull whoever they could find from city slums. These soldiers were often drunk, disabled, unable to speak English, or malnourished.

This change was taking place as the three-year term was ending for the veterans who had enlisted at the start of the war. About a half re-enlisted, their decision aided by a furlough and bounty.

The changing makeup of the army meant that management had to change. There was an increase in the severity of the training drills. Discipline had to be enforced, often with publicly brutal measures. The new recruits responded to brutal drills and discipline, so those became the tone of the army overall. No longer was there an unspoken communication and understanding between leader and soldiers; communication had to be explicit, harsh, unrelenting, public, and equanimous.

Leadership style developed as well. Ulysses S. Grant took charge of the Army of the Potomac as a relentless and mathematical leader. Grant may have been dispassionate about his troops compared to prior commanding generals; others had dwelled on preparations and planning in the expectation that more time would reduce the risk to the men who were their neighbors. Ironically, this caused delays that allowed the Confederates to dig in and create strongholds that ultimately caused more casualties and prolonged the war. In Grant’s hands, the pace of the war quickened.

You could make the argument that in the early days of the war, the army deeply depended on the individual qualities and relationships of its troops. As it grew, it needed to become more of an engine capable of taking in anyone and absorbing them into standard practices, processes, and an explicit culture. The benefits of the early days were that layers of management, communication, and discipline were not needed to orient and motivate the troops. More investment in this was needed in the later years to build the strength of the army up with greater numbers. Ultimately, even then, the power that it had was still deeply indebted to the passion and experience of its veteran soldiers.

This is a similar path that startups go through. Processes and explicit culture may not be needed in the early days, but those who set the example for future hires are just as critical later on as building in the layers of management to enforce them.

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All books and other resources referenced in this article