Company Values: Do They Matter?

Most organizations have a set of values they have on posters and websites. Some are truly committed to their values, while others pay lip service. You may have seen both of these examples in your career. The question at hand is "what is the impact of each of those realities to the organization and its customers?"

The Promise.

I was conducting a leadership workshop many years ago and one of the discussions was around company values. My question to the group was "why do company values matter?" The best answer I've ever heard from this question was from one of the participants. Her answer was, "Values are a set of promises." That caught my attention and my response was, "tell me more." She said, "When a company has integrity as a value, that is a promise to their employees and customers about how they will conduct business. It's the same thing with respect, innovation, or any other stated value." I love that perspective.

Back in the day when I was in graduate school, the great case study of the day was Johnson & Johnson from the early 1980s. One of their leading brands, Tylenol, was injected with cyanide by some malevolent people in the Chicago area and then put back on the shelves of the stores. Seven consumers died from the tainted product. The investigation proved that this was an isolated incident. Nevertheless, J & J CEO James Burke ordered the recall of some 30 million bottles of Tylenol that were in hospitals and retail stores, to the tune of about $100 million dollars. J & J then reinvented safe packaging (that we see today) before they restarted manufacturing Tylenol. One of their core values was consumer safety and they stepped up and remedied the problem. They kept their promise of consumer safety and the brand was enhanced and market share increased.

The Other Side of the Coin.

In another workshop with a software company, we had the same discussion. When we broke for lunch, I stayed in the meeting room to handle emails and return a couple of calls. One of the participants came back from lunch early and brought back with him a very attractive pyramid that was 6 or so inches tall. It had the company values inscribed on it. He showed it to me and asked what I thought of it. I asked, "Who gets the pyramid?" He told me everyone in the company gets it and the expectation is that we have it on our desks. Again he asked what I thought of it. I told him I thought it was an impressive looking piece, and a creative way to keep the company values in front of everyone. He didn't look impressed with my response, so I asked, "What do you think of it?" The immediate answer was, "It's BS!."

I was taken aback by the answer, so I responded with, "Tell me more about that." He went on to say that while it was a nice pyramid and the values are ones to aspire to, the big problem was that the senior leadership doesn't practice them and everyone knows it. The pyramid has become a joke around the company. "What is the impact around the company?" I asked. His answer was "Cynicism and distrust of the company." I can't help but wonder how much this company's brand has been tarnished from the level of distrust within the ranks.

Three Levers.

Consider these three levers as ways to ensure your values are promises kept rather than a joke around the organization.

1. Walk-the-Talk. There is no substitute for senior leadership leading by example, as demonstrated by J & J. On one of my podcasts, Real Business in Real Time, a company CEO told me that their number one practice for building a healthy, trusting culture was that the senior leadership team was expected to walk-the-talk AND hold each other accountable, including the CEO. That is uncommon in my experience - and powerful!
2. Recognition and Accountability. In a previous life I worked in a safety-sensitive industry, so safety first was the number one value. One of the effective practices was to recognize people who demonstrated the "safety first" value in a meaningful way. An example that comes to mind was taking quick action to protect the safety of teammates or customers in a potential risky situation. That kind of recognition was effective in reinforcing the value of safety throughout the company. The other side of recognition is accountability. One of my former colleagues was the COO of the company. The quickest way for one of his leaders to be on the receiving end of some straight talk was to "look the other way" with safety infractions.
3. Have a listening strategy. It's easy to sit in the executive offices and think all is well, insulated from reality. Have a plan for listening to your employees and customers. This can be regular one-on-one meetings, focus groups, or anonymous, short and sweet pulse survey that ask simple, straight-forward, real-time questions. "How would you rate the leadership of the company in practicing our core values?" An open ended question might be "How can we do better in living our core values?" The old maxim, "What gets measure get done" applies to getting this kind of feedback.

Several years ago I had a radio show called, Lessons in Leadership. It was a one-hour interview format where I talked with leaders from many industries. One of these leaders said something I will always remember. "Forget about what companies put on their websites and posters. If you want to understand the values of any organization, just watch how their leaders behave." Simple, profound wisdom that has stayed with me.

What one step can you take to make sure your company/team values are a set of promises that are consistently kept? It's only the brand at stake.

Dr. Mark Hinderliter is a Veteran-Owned Business Owner who works with companies to develop their twin superpowers: leadership and culture.

Godspeed in your leadership journey.