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Using Culture as a Growth Strategy at Mercado Libre

 Using Culture as a Growth Strategy at Mercado Libre

Employee Experience Leadership & Management

When you think of wildly successful companies that started in a garage you might think of Apple, Google or Amazon. But talk to anyone in Latin America and they would add Mercado Libre to that illustrious list.  

Mercado Libre is notable for many reasons: in just under 20 years, they’ve become the largest e-commerce company in Latin America, with more than 44 million active users in 18 countries. But what makes Mercado Libre worthy of admiration is how their Founder and CEO, Marcos Galperin, used culture as a strategy to grow the business.  

Many leaders agree that if they nail culture and create conditions for their employees to thrive, success will follow. But few organizations are as successful as Mercado Libre in creating a great workplace for all. In fact, they are recognized as a Best Company to Work for in every country where they have employees. And, this year, the company is also #7 on the World’s Best Workplaces list.

The secret to Mercado Libre’s culture success isn’t sexy. The company succeeds because of old-fashioned discipline. There is an unrelenting focus on ensuring that employees live the culture and values every day through intentionally designed processes and practices.

At our 2019 Summit, Mercado Libre’s SVP of People, Sebastian Fernandez Silva, and Natalia Mileo, Culture & Experience Director, talked about how they fuel business performance through their culture. Like many, I was struck by how methodical their approach is. Listening to them was like reading a textbook on how to create a high-performing culture. They described principles like:

  • Being clear on who you are and intentionally and consistently living your culture and values in everything you do and every decision you make.
  • Being clear about what great leadership looks like, ensuring accountability at all levels to both the ‘what’ (results) and the ‘how’ (behavior).
  • Engaging your people around a compelling and inspiring vision and higher purpose in a way that involves them and recognizes their contributions.

Mercado Libre believes that culture is created through behaviors, symbols and systems and executives have gone to great lengths to intentionally design business processes and practices through this lens. Sebastian shared that the company honors its culture with every decision it makes.

This discipline separates this company from those who do a great job talking about their culture and values, but don’t go deeper to deliberately design and align decisions, practices and processes to drive actions and behaviors that advance culture. The fact is that when misalignment exists, it erodes credibility. Trust is lost when, for example, employees see a leader allowed to behave inconsistently with company values or in organizations that espouse the importance of innovation, but don’t actually involve employees in decisions or ask them for their ideas.

To better understand how Mercado Libre aligns business process and practices to embed behaviors, symbols and systems, let’s look at the company’s hiring practice. Applicants may have all the right skills for a job at Mercado Libre, but it is culture fit that will get someone hired. During interviews, team members probe for culture fit. If a team member doesn’t feel the candidate is a fit, the interview process stops right there. The candidate’s experience during the interview process is just as important. Candidates aren’t left to wonder for weeks whether they will move on in the process. Rather, team members enter interview feedback into a mobile app, right after the interview, so the hiring manager has the input needed to make and communicate a decision. Time to enter feedback is even measured. 72% of interview feedback is captured in just 120 minutes! 

Leadership is another critical area where discipline around process and practices is strong. Mercado Libre recognizes that a high-trust, high-performance culture isn’t possible without effective leadership at every level. All leaders are developed and accountable to very clear leadership behaviors and competencies. Leaders are evaluated and talent calibrations are conducted based on both results (what is accomplished) and cultural principles (how it’s accomplished).

And this too is carefully measured. They not only look at employee engagement, but also measure factors that directly impact this such as the frequency of meaningful conversations and frequency of recognition by leaders.

Ask any employee to recite the values of Mercado Libre and they can tell you not only what they are but how they are lived. These aren’t just words on paper tucked away in a policy manual, they are the foundation that drive hiring decisions, promotions, performance reviews, recognition and every human capital decision the company makes.

Putting Ideas into Action: If you are inspired by this story, pull out your organizational values and engage employees and leaders in evaluating areas where policies, processes and decisions are aligned with your values and where they may be working against them. Start small – pick one area to start. The act of visibly auditing alignment of your practices to your values will by itself send a strong, clear message of how critical culture is to your business success and involving others in this process will build shared engagement, commitment and credibility.


Ed Frauenheim