Solid to the Core - the Core Value

Several years ago, I was in charge of defining a Core Value for my company. This article is simply a small effort to share my learnings, in the hopes that it may be of some help to others – individuals or organisations – facing a similar task.

During the process, became clear to me that defining a company’s – any company’s – Core Value is, and must be, a question of:

a)     Identifying and articulating who we are, as a company; what we stand for

b)    communicating this clearly to the company’s key stakeholders – investors, market, and employees; current and potential – in a way that everyone can grasp and agree with

c)     making this permeate everything the company does – planning, positioning, marketing, product development, value proposition, activities, and so forth – so that the Core Value guides all company operations as well as its internal and external image.

Key to this is understanding what a Core Value is. How does it fit into all the other nice statements that adorn the company’s annual report?

• Where our company’s various Mission, Vision, etc. statements tell us what the company does and what it wants, the Core Value tells us our company’s identity – what we are about.
• Where the business concept answers the questions ”what?”, ”for whom?”, and ”how?”, the company’s Core Value answers the question ”why?”.

There may be a multitude of companies out there with similar, or even identical, business concepts, that on the surface do exactly the same things that we do. But a Core Value defines what it is that makes our company unique – the core that, in a busy world where everybody is trying to penetrate the media noise to get some attention from their stakeholders, is what justifies this particular company’s existence.

A Core Value is thus a matter of differentiation at the most fundamental level; a question of defining the “feeling” or “spirit” in a company; the company’s soul, as it were: What do we offer the world – not as a product, or in our value proposition, but as a company?

In a nutshell: it defines not merely what makes this company unique, but much more importantly, why this company is unique.

In the following, we will ponder what this implies for the task ahead, and we will be using Apple’s Core Value success story as an example to highlight what clearly has been a highly successful approach.

Let us consider what each of those three points might mean:

 a)     Identifying and articulating who we are, as a company; what we stand for

When returning to Apple in 1997, Steve Jobs addressed Apple’s employees on the subject of value-based marketing. This address also marked the launch of Apple’s famous “Think Different” marketing campaign. In his speech, Jobs talks about what it is that differentiates Apple from all other companies, and hence, what it is that they should be focusing on in their marketing. In the end, he boils it down to the following:

“Apple at the core, its core value, is that we believe that people with passion can change the world for the better [...] and that those people who are crazy enough to think they can change the world, are the ones that actually do." 

You’ll find an excerpt from that address here

As it happened however, this value was deeply rooted in Jobs’ own private values, and it lay at the foundations of Apple already when he started it in 1976. In an interview given in 1994, a few years into his absence from Apple, Jobs expresses his philosophy thus:

“When you grow up you tend to get told the world is the way it is and your life is just to live your life inside the world. Try not to bash into the walls too much. Try to have a nice family life, have fun, save a little money. That’s a very limited life.

“Life can be much broader once you discover one simple fact, and that is: everything around you that you call life, was made up by people that were no smarter than you. And you can change it, you can influence it, you can build your own things that other people can use.

“The minute that you understand that you can poke life and actually something will, you know if you push in, something will pop out the other side, that you can change it, you can mould it. That’s maybe the most important thing. It’s to shake off this erroneous notion that life is there and you’re just gonna live in it, versus embrace it, change it, improve it, make your mark upon it.

“I think that’s very important and however you learn that, once you learn it, you’ll want to change life and make it better, cause it’s kind of messed up, in a lot of ways. Once you learn that, you’ll never be the same again.”

The “Think Different” campaign coupled the brand with a couple of dozen famous passionate, crazy people, such as Picasso, Einstein, Amelia Earhart, Jim Henson, Gandhi, Chaplin, Dylan... – people who have all been regarded as oddballs, but who have all left an indelible mark on the world.

Immediately afterwards, the now expressly formulated and thereby revitalised Core Value became apparent in Apple’s product strategy, with the launch of the first iMac. Only shortly afterwards, the first iPod would see the light of day, and forever redefine how the human race consumes music.

It is thus possible to trace how Apple’s Core Value lay as a foundation for everything the company did after 1997 and for some time after Jobs’s death: how they formulated their principles and statements, their goals and visions, their strategies and operational plans, their activities, road maps, products, market communications… The key lesson is: everything at Apple, from the business concept out, was solidly founded in their Core Value.

The challenge for us going through the same process is to try to articulate something equally profound for our company.

b)    communicating this clearly to the company’s key stakeholders – investors, market, and employees; current and potential – in a way that everyone can grasp and agree with

A company’s Core Value should make:

• investors/owners feel that this is something they want to be associated with and engage in, and therefore want to invest their money in for the long run.
• market/customers/suppliers feel that this is something they can identify with and trust, and therefore want to be seen doing business with.
• employees/labour market feel that this is something they want to be part of and be consumed by, and therefore perceive the company to be an attractive employer for whom it is satisfying and enjoyable to work.

Apple was highly successful in its communications with all of the above: the company’s stock value has been astronomical, its brand one of the highest valued – if not the highest valued – in the world, chaos used to ensue every time they open a new brand store or launch a new product, literally everybody wanted to be a supplier to Apple, and irrespective of the situation on the labour market, there would at any given time be a queue a mile long outside their doors of people wanting to start working for them.

And indeed, this was what Steve Jobs created on his return to Apple: during his absence, the company had been increasingly struggling with their market position. They had started losing focus, and with no real sense of what the company really was about, it had started disintegrating. With the return of Jobs, and the “Think Different” campaign, the company was brought back into letting itself be guided by its Core Value and the rest was, as they say, history.

After Jobs passed away, it seems that clarity of vision may have started fogging over. This however comes down to a question of management culture. If the Core Value is well articulated and the company’s management truly lives by it, there is no need for this to slip.

For many of us, our company’s “core value” as seen from our investors/owners’ perspective is often literally no more inspiring than a prosaic “$XXX M”.

Hopefully however, we will be able to come up with something that broadens this somewhat.

The market makes rational decisions. Whether or not a company gets to deliver to a customer, or to represent a supplier on a given market is, at least nominally, decided by a host of strictly rational factors, often with numbers in them.

But in the end, the actual decisions are made by people, and people can be strongly influenced by the type of meta-values that a Core Value communicates. Even in a world of exclusively rational ruling parameters and KPI’s, when the scales are evenly balanced, the “right” Core Value can make them tip over in our favour, and sway a decision maker to call us instead of the other fellow, to give us that extra little respite, that second chance.

As for employees/ labour market, it is important for any company to be able to keep and attract good people in general, and the type of good people that excel at whatever it is the company needs from its workforce the most, whether it be skills or attitudes, in particular.

The Core Value also defines what people the company attracts: those who find a particular Core Value attractive, will also be attracted to the company. Those who do not find the Core Value as attractive aren’t as likely to seek positions at the company either – and most likely, that’s as we would prefer it to be.

c)     making this permeate everything the company does – planning, positioning, marketing, product development, value proposition, activities, and so forth – so that the Core Value guides all company operations as well as its internal and external image.

This pertains to the Core Value, as we have already discussed, defining the core of what the company is. Therefore, it needs to be discernible in the company’s business concept, and form the base for the company’s vision, intent, strategy, operational planning, and execution.

For a Core Value to achieve its intended effect, it needs to be the immovable base for everything the company does, internally or externally. Starting from what internal policies the company establishes and which customers it chooses to focus on, all the way to what give-aways the company procures, how the workplace is furnished, what its employees are equipped with, how its advertising or presentations are designed – if it is to live up to, and deliver upon, its full potential the Core Value must run through everything.

Exhibitions, staff policies, supplier activities, the company’s graphic profile and how it is used, the company’s marketing messages – everything should mirror its Core Value.

As an end note, it is very interesting to highlight one specific, very important thing in Steve Jobs’ 1997 address that is highly prominent in its absence.

In all that he says, there is not a single mention of “business”, “revenue”, “profit”, “sales”... And the only time products are referred to, is in the part that specifies what Apple isn’t about:

“And what we’re about isn’t making boxes for people to get their jobs done — although we do that well. We do that better than almost anybody, in some cases.

“But Apple is about something more than that.”

Instead, what he exclusively talks about, is people.

It is also very clear in the Think Different ad – the one designed to, for the first time ever, really define what Apple’s brand really stands for: not a single computer is shown, but instead all the images are of people, and all the speaker talks about is human qualities.

The conclusion would thus seem to be that a successful Core Value shouldn’t really talk about the company itself, or its value proposition. Instead, it should talk about the people that the company wants to address, and that make up the company.

The very last thing a Core Value can be is another set of lines of “corporate bullshit.”

Object Lessons

If Apple is a – the – prime example of a company that has done their Core Value homework right, by contrast, let us have a look at an equally shining example of a company that did it wrong. In this article, I choose to call it [Company x].

[Company x], too, defined a set of Core Values – called “The [Company x] Way” – in 1997, the same year as Apple did.

Their format was one that we often see today: a handful of bullet points with key words or phrases, each with lengthy definitions to explain what the bullet points actually mean:

• Customer Satisfaction
• Respect for the Individual
• Achievement
• Continuous Learning

(Wordy definitions omitted for brevity)

The process [Company x] followed to articulate these values employed a “bottom-up” approach very similar to what I used when I did it. As a result, in the company’s workforce, it was felt at the time that these captured the company’s “spirit” very well.

Some years later however, changes were made in [Company x]’s management, and these Core Values were modified to:

• Customer Satisfaction
• Respect
• Achievement
• Renewal

And eventually, in 2007, these were completely rewritten as:

• Engaging You
• Achieving Together
• Passion for Innovation
• Very Human

Of particular interest, and a point keenly felt by [Company x] employees at the time, is how “respect for the individual” was changed to just “respect”, and finally dissolved partly into “achieving together” and partly into “very human”. In other words, in a ten-year period, [Company x]’s philosophy morphed from a recognition of their individual employees as their key success factor, into one of regarding their collective workforce merely as a capital asset.

Herein lies also one key lesson about what a Core Value is, and is not: as has been mentioned earlier in this text, a Core Value is intrinsic to the company culture, and it guides how the company and its people go about their work every day. It is not, and can never be made, a management tool – and this is unfortunately how [Company x] tried to use it.

The other fatal error in [Company x]’s handling of their Core Value was in failing to recognise that a Core Value should be constant, immutable, reliable. Introducing three versions of Core Values within a ten-year span clearly indicates that (a) while the company’s employees did fully embrace the initial Core Value, the management did not; nor did the Core Value permeate the company’s culture deeply enough to envelop the new management, and consequently, (b) their definitions clearly failed to articulate the values that define [Company x]’s actual core very well.

And in the end, how did it go?

Apple clawed their way up from the pit of brand mismanagement that they had been sinking into for much of the past decade, and after the iMac went on to introduce a succession of game changing, iconic products such as OS X, the iPod, iTunes Store, iPhone, iPad, Apple Watch... Today, in every field that they are present, Apple is still pretty much the brand that everybody else is trying to follow, even emulate, and the core value encapsulated in the slogan “Think Different” can still be discerned as their guiding star.

[Company x] by contrast, was at the turn of the millennium the undisputed world leader in mobile handsets. In failing to recognise what, exactly, it was that had gained them that status, they subsequently gradually lost their position on the market. And in 2007 – the same year [Company x] revamped their core value the second time – Apple made their move onto [Company x]’s market with the first iPhone. This left [Company x] reeling; they lost what little grip on the market they still had, and their subsequent attempts to regain a hold never met with any success. They later sold off that part of their operation, and years later re-launched the brand on a branded platform.

These two companies form schoolbook examples of how a well-defined Core Value that is accepted and religiously adhered to by all stakeholders – owners, management, employees – can guide a company to all but unlimited success, and conversely, how a Core Value that isn’t deeply founded at all levels of the company will be of no use whatsoever.