The "Values" Trap: Four Things Values Might do for your Company...and Four Things They Won't

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  • Originally published on Linkedin Pulse.

    Along with the popular chorus that “Culture beats strategy,” we’ve seen a resurgence in interest in corporate values, based on the observation that values and culture go hand in hand. So in the triune of Corporate Mission, Vision and Values, it seems that values have become of paramount importance.

    A good set of values covers what is important…all of what is important. Usually that means the interests of customers and employees at all levels, as well as shareholders, and might extend to the responsibility toward the local community or the broader world. Clarifying and capturing values has many benefits.

    What values will do for you:

    Values can be inspirational.
    They call everyone to the higher purpose of the organization. Values can be grounding. They remind employees and managers alike of the guiding principles to apply in the day-to-day work and interactions. The values reinforce the cultural norms you want practiced.

    Values can also identify who may be a good fit as an employee or a manager.
    Preserving and building a culture means that shared values are critical to that end. Making your values clear and public will attract people of like mind.

    Values may also be powerful a guide to decision making when faced with a dilemma.
    Values tell you what is more important than everything else. Nordstrom’s values put customers first, so they have a no-questions-asked policy when an item of clothing is returned. It’s more important to risk a few scammers getting away with wearing and returning a dress, than it is to alienate the vast majority of good customers.

    When values-as-professed are aligned with the actions and focus of the company, they embody the culture.
    But the enthusiasm behind values can be abused as well.

    What won’t values do for you?

    Values won’t overcome a bad strategy, or one that is a poor fit for particular markets.
    You still need strategy, and you still need to understand the different markets for your products and design your offerings, product mix and approach to the needs and receptivity of that market. Just having your employees apply the values that work in one market will not make up for bad positioning in another. That’s especially true as companies expand into the international space, using the same marketing, product mix and advertising across vastly different cultures in Europe, Asia, Africa and the Middle East.

    Values won’t (by themselves) change the behavior of people who are a bad fit for the organization, although it might disguise their behavior for a time. It will let people know what they must appear to value. Someone once said “Sincerity is the most important thing. Once you can fake that, you’ve got it made.

    Values won’t override the effects of misaligned policies and practice.
    If you say “Customer satisfaction is everything,”but you punish workers who accept customer returns of your product, you’ve just proven that you don’t mean what you say. Customers will notice. And employees know what is really important: the immediate bottom line, not the customers who are the lifeblood of the company. They’ll act accordingly.

    One manufacturing organization I studied professed to empower its technical employees to bring quality problems to the attention of management and the customer so they could be addressed. That value was expressed as: “You hold the key to our success.” But managers were being held accountable to not report bad news to superiors and customers alike. So in the end, “holding the key” really meant that the technical staff had the responsibility for fixing things they had no authority or ability to fix. If they persisted in pushing up the chain of command for attention, their careers would suffer. The cynical restatement of that value became, “You hold the bag,” because the employees were between a rock and a hard place—exhorted to do things that would hurt them personally in the end.

    Finally there is one last serious pitfall of focusing only on values.

    If you use “values” exhortations instead of addressing the real sources of problems, it will backfire. Not only will it not fix the problem, it may drive people to cynicism and cause customers and employees alike to question the trustworthiness of the entire operation.

    A large auto manufacturer declared that “Quality is Job #1”before they accomplished their quality transformation. Implicit in that mantra was the message that workers should be more careful and not make mistakes. The real problems were in the design and manufacturing process itself, which designed in opportunities for error and defects. The response of their workforce (as expressed on the bathroom walls of the plant) was not only cynical and negative, it was unprintable. It took years before the changes were made in design and production that improved the quality of the product. When the quality battle was won, the values statement about “quality as job #1”was simply unnecessary. The problems with quality were not problems that could be solved with attention to “values.”They had to be solved with engineering.

    Take aways: Values are important, and can be the inspirational focus for a business. They can support a consistent, powerful culture focused and agile enough to take on the competition. The real key is using them as a touchstone for all the decisions, policies and behaviors, to make sure that the values professed are the lived values in action; and not using them in place of fixing what isn’t working.

    (This post was also published on the Vision & Execution Blog)

  • Kevin Kreitman
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