Vacations: Your Secret Business Growth Strategy

As a founder & CEO, I know that I have an elevated level of responsibility to my team. That means I have to think about their well-being and self-care. At the beginning of a company’s lifecycle, oftentimes well-being and self-care are not usually the highest priorities. Things like growing revenue, finding customers, and identifying product-market fit usually take precedence. After you’ve gotten past those, you begin to grow, and hiring great employees is usually part of that growth.

Once your startup has stabilized and you've found your rhythm, many questions that are specific to your team arise like — “What is our vacation policy?” In a fast-growing company, many employees are often all in and work exhaustively to fulfill the needs of the business and satisfy their own ambition. On top of that, these employees often have added responsibilities at home, such as elderly parents, children, and personal growth initiatives.

Burnout is real. In order to combat this burnout, it’s essential to normalize and advocate for employees to take time off. How do leaders adopt policies that work for a fast-growing and ever-changing company?  Oftentimes, they draw upon their past big-company experience… or worse yet, leave it to the newly hired HR person to come up with the answer. Too often, the maturing startup sets policies that bound and limit vacation time.

So what’s the right vacation policy? Don’t focus on your vacation policy. Focus on your management structure instead. Create a great organization filled with strong leaders that are empowered to make decisions. Don’t let the bean counters in to accrue vacation time and put policies in place that determine vacation time by tenure, rank, or title. Instead, let employees have meaningful conversations with their managers that allow them to take the appropriate amount of time off for their personal situation, as each situation is different. As long as the company and the work product are not affected, employees can take all the time they need (or as little as they need).

As leaders, we have to practice what we preach and take time for ourselves as well. Your culture will start with you, so make sure to model the behavior you want to see in your team. Make sure as a leader, you are taking time for yourself — and make sure you downright force your direct reports to take some time for themselves as well. Really great and driven employees will burn the candle at both ends, and sometimes you have to intervene on their behalf.

We put this policy into practice at PeakActivity several years ago. It was an outstanding experiment. From a cost perspective, we had nothing to track on the books — no accrual, no hours owed, no negative vacation balances. From a morale perspective, employees and managers both felt extremely empowered. Oftentimes, employees tended to take less vacation and had to be encouraged to leave their work behind for a few days or weeks.

As it turns out, even the big companies have been catching on. Here are 11 companies that have adopted flexible paid vacation schedules (and what they’ve found).