Do Corporate Values Matter?

Values.

This can be a flighty topic for some businesses. Many business journals and magazines discuss the necessity of strong core values and how they can impact employee performance. But my experience with on-the-ground leaders is that they’re a bit skeptical about how they can make an impact at all; positive or negative. It’s understandable. When you’re worried about taking care of clients, “values” can seem abstract. Getting work done seems more objective. Moreover, a company's stated values seem meaningless; a mere marketing scheme to make the consumer feel good about working with that company. Look at this company's core values for example: Communication. Respect. Integrity. Excellence. Any guesses on which company these values belong to? Enron. One can only surmise that the executives of Enron found these to be meaningless at best and an absolute lie at worst. However, despite bad actors in the marketplace, I would argue that core values drastically enhance overall business operations, employee engagement and most importantly, client satisfaction.??

Two years ago, as a part of our EOS (Entrepreneurial Operating System) adoption, I was locked in a conference room with my companies' executive team. After two hours of work and a lot of back and forth, we narrowed down our initial list of over 100 potential values to 5. The entire time we reviewed and debated this list our team kept asking, “is this how our people actually behave? Or, is it how we want our clients to think we behave?” Patrick Lencioni wrote that since the mid 90’s, “The values fad swept through corporate America like chicken pox through a kindergarten class. Today, 80% of the Fortune 100 tout their values publicly—values that too often stand for nothing but a desire to be au courant or, worse still, politically correct.”1 Our executive team knew this and knew that if these values were going to matter, they had to be genuine. We had to be able to look our people in the eye and say these truly mattered and resist to urge to create something our clients would love. Ultimately, we knew that the values we were going to present had to be non-negotiable. Meaning, we were willing to part ways with employees over them. If our values didn’t meet this standard, then we would end up no better off than Enron. Well, maybe without the illegal activities and the prison time.??

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At the end of our values session, all of us were exhausted. However, we all felt excited about the list we came up with; Humility, Trust, Balance, Compassionately Driven, and Comfortably Unique. We felt these values resonated with us and we were willing to hold ourselves and our team accountable to them. We decided to sit with these values for a month until our next offsite and see how they resonated when we watched our team in action. Over the course of that month, we knew?we?hit the nail on the head. Notably, most of the values we landed on were not the values we wanted. In our initial round of suggestions, we tended toward values that we thought our clients would be on board with and were continually tempted to lean that way. Our team, through their behaviors and actions, showed us?what our company values truly are?and we just named them. We put them on paper. So, when we decided to roll them out to the team, none of it felt difficult or awkward. We even immediately started rating our team on how well they exemplified our values in their annual performance reviews.2?

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What have the results been? Outstanding! For a long time, we struggled to verbalize why some employees may be technically doing their jobs well but were a pain to be around. Or, why some employees were wonderful to be around, but something wasn’t going right with their job. In essence, our values allowed us to differentiate between who our employees were and what skills they possessed and coach them accordingly.?Shockingly, most of our employees who had struggled did not have a “skills” problem but a “values” problem. You know what I’m talking about even if you can’t verbalize it. John may seem to struggle with his work. You train him, you get him coaching, you start micromanaging his work. You show him tips and tricks to do his work more efficiently and he still struggles. Then, one day, you realize that John is just lazy. You’ve seen him produce the necessary work when he has to but failed to see why he’s inconsistent. If you had a value of say, “diligence” you could more easily have a conversation like this. “John, being diligent is important to our team. Here are three examples from this past month where you clearly lacked diligence and turned in your work late and incomplete.” It completely changes the conversation and allows you to help your employee understand that this value is important; to the company and to his performance. Nine times out of ten, we’ve seen that simple conversations like this move these types of employees into a better performance position.?And yes, we have had to have those difficult conversations with employees who would not or could not live up to our values. But, thanks to up-front conversations about expectations those situations were never a surprise and rarely difficult. The employees realized they didn’t want to be on this team and most of the time it felt like a mutual decision to part ways. Fortunately, this situation has been extremely rare for us.?

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This has been our company's experience of using core values and using them well. Thankfully, we didn’t come up with the process or the approach and it’s nothing unique to our company. Books like Traction?by Gino Wickman and The Ideal Team Player by Patrick Lencioni all outline in detail ways you can implement core values. (There are numerous other books as well). If you want a solid game plan of how to do this, read these books. However, no book and no amount of preparation will take away the time and emotional investment needed from your leadership team. The leaders need to be 100% on board or else this effort will stall. If our leaders had not been on board and excited our values would have fallen flat and our employees would have easily seen through our plan and promptly ignored us. As it stands, our culture is stronger than ever so it’s worth the time to get the leaders on board and in line with your values before moving out of that circle. ?