Company Values VS Guiding Principles

Company values: 

Does your company have them? Did you write them? Steal them from another company? Can your employees recite 3 or 4 of them? How about 2? Even one?

Most entrepreneurs, at some point in their company’s lifetime, will carve out some time to hammer out some core values for their company. Sometimes this is because they know it’s something they ‘should do’ or they read about it in a book. They bang them out after their morning coffee, or at a ‘retreat’ somewhere in the woods. 

Often they end up looking a little like this:

Honesty

Integrity

Respect

Then they go up on a wall somewhere. Soon they’re just another piece of furniture, as useless as the beer-stained foosball table in the corner.

Here’s a nice example to demonstrate the ‘usefulness’ of core values...

In its year 2000 annual report to shareholders, Enron listed its core values as follows:

Communication – We have an obligation to communicate.

Respect – We treat others as we would like to be treated.

Integrity – We work with customers and prospects openly, honestly, and sincerely.

Excellence– We are satisfied with nothing less than the very best in everything we do.

How did that work out for Enron and its shareholders?

---

There’s another approach to ‘Core Values’ - I call them Guiding Principles. It’s a subtle distinction but an important one. 

Core Values may, or may not be, actionable. Guiding Principles, on the other hand, are inherently useful and actionable. As the name suggests, they help guide the company (especially through tough times).

They’re also one of the pillars I used in my efforts to almost completely remove myself from my company Sacred Rides. 

I call them Guiding Principles because, unlike lovely wall-framed ‘Core Values’, they serve as a guide to our staff. When done right, Guiding Principles serve as a sort of beacon for the company and they make the decision-making process easier for everyone. 

But in order for your Core Values to become Guiding Principles, they need to stand for something - they need to define your company and your company’s view of the world. 

Your guiding principles should be written in a way that makes them: a) a bit controversial and b) shine a clear light on how staff should make decisions. Let me explain. 

First, controversy. 

Your Guiding Principles should state something about YOUR particular view of the world, in a way that others might take issue - or even offence - with. If they contain wishy-washy language like ‘honesty’ or ‘integrity’, throw them out the window. No one would argue against honesty or integrity in a company, so why even bother? And if your employees need to be told to act with honesty and integrity, you have bigger issues to deal with. 

For example, one of our Guiding Principles is to ‘Make decisions that will make sense 100 years from now’. In a nutshell, I want my staff, when confronted with a significant decision, to favor the decision that will make the most sense for the company, our staff, customers, and shareholders 100 years from now - not this quarter, or this year, but 100 years from now. 

Not everyone agrees with this approach; not every company sees things this way. ‘Why would I make decisions whose results I won’t even be around for?’ would be a perfectly reasonable response to that principle. But that’s not the kind of company *I* want, and if people disagree with it they can find another company to work for - and their decisions had better be in alignment with it.

This Guiding Principle encourages long term thinking and it forms a core aspect of our discussions. When staff come to a fork in the road, this principle - along with our other 7 - helps steer them in the right direction. 

Secondly... decision-making. Like the Vivid Vision framework I touched on recently, Guiding Principles help eliminate tough decisions and discussions that can take up a lot of your and the company's time. When confronted with multiple courses of action, staff know they should choose the option that moves the company towards the Vivid Vision, while staying in accordance with its Guiding Principles. 

Again, this removes you - the owner - from the equation, ensures staff are moving the company in the right direction, and avoids needless delegation of decisions to you and your inbox. 

Take the time to get your Guiding Principles right, then make sure they form a consistent and important part of your conversations with staff. Remind them of the Guiding Principles frequently. Ask them if they were considered when they made decisions. I tell my staff that as long as their decisions are in line with our Guiding Principles, then they can't make mistakes.

I'd love to hear more about your experiences with Core Values or Guiding Principles. Comment below!

---

P.s. I hope you’ve enjoyed this post and found value in it. If you’re interested in exploring topics like this further, there are a few ways I might be able to help you:

1. Join me and your fellow entrepreneurs at one of my upcoming Mastermind Adventures events, where we explore topics such as these and where you can connect with, learn from, and have crazy adventures with your fellow entrepreneurs: https://mastermind-adventures.com

2. I create a bit of space in my schedule to coach overwhelmed entrepreneurs (typically leading companies from $500K to $5M) on how to get out of their team’s way, free up their own time and have self-managing companies that create less stress and more joy in their lives: https://mikebrcic.com/consulting 

3. If you’re in Toronto, join my mailing list and get notified about upcoming events I put on for entrepreneurs, like workshops, dinners and get-togethers: https://mikebrcic.com/toronto-events