Core Values: Wall Posters or Culture Builders?
Do we really have to tell people how to behave at work?
Posted August 17, 2010
Several months ago, I wrote a blog about the difference between a Vision and a Mission statement, both core components of any good strategic plan. In this blog, I will focus on Core Values, another key component that is often defined by an organization's highest level of leadership.
Once a Mission, Vision, and Core Values are defined, it is critical that senior leaders consistently communicate them: the "why we exist," (Mission), the "where we are heading in the future," (Vision), and "what behavioral norms are expected to be upheld by all when interacting to accomplish work together" (Core Values).
Why should your organization define Core Values?
Most people in professional roles have an average IQ of 110, so do we really have to tell people how they are expected to behave at work? Yes, because in a workplace without clearly defined Core Values, people naturally rely on their own values to guide them in how they interact with colleagues, direct reports, supervisors, customers, etc. It is normal for people to use their personal value system to guide their decisions in prioritizing, working with teams, managing conflict and dealing with challenging situations.
Core Values that are embedded into an organization's culture can help to:
- Clarify the behaviors that everyone is expected to uphold at work;
- Provide a framework for decision-making and agreements about how people are expected to interact with each other;
- Raise people's awareness about individual behaviors and how collective interactions influence perceptions by others and customers; and
- Manage performance expectations of all employees, including new staff who may become acquainted with Core Values as part of their orientation process.
Core Values do not add value if the behavior of those who typically have the most power in organizations do not demonstrate them at work. One executive who appears to be a Core Values convert is Tony Hsieh, CEO of Zappos.com, Inc. In his first book, "Delivering Happiness: A Path to Profits, Passion, and Purpose," he explains how defining Core Values for the company positively impacted its growth to over $1 billion in 10 years. The following is an excerpt from his book, released June 2010:
"Even though our Core Values guide us in everything we do today, we didn't actually have any formal Core Values for the first six or seven years of the company's history. It's my fault that we didn't do it in the early years, because it was something I'd always thought of as a very "corporate" thing to do. I resisted doing it for as long as possible. I'm just glad that an employee finally convinced me that it was necessary to come up with Core Values - essentially, a formalized definition of our culture - in order for us to continue to scale and grow. I only wish we had done it sooner."
Tony credits Core Values as important guidelines that Zappos.com managers use in making hiring decisions. In his book, he states: "I wanted a list of committable Core Values that employees were willing to hire and fire on, because if they were not willing to do that, I did not consider them Core Values. In my 20 years assisting organization in developing Core Values, the average number appear to be 3-7, but Zappos.com has 10. The following is the final list of 10 core values that Zappos.com still uses today:
- Deliver WOW Through Service
- Embrace and Drive Change
- Create Fun and A Little Weirdness
- Be Adventurous, Creative, and Open-Minded
- Pursue Growth and Learning
- Build Open and Honest Relationships With Communication
- Build a Positive Team and Family Spirit
- Do More With Less
- Be Passionate and Determined
- Be Humble
Core Values Influence Your Organization's Culture
Zappos.com's Core Values continue to be consistently imbedded into the operational norms and culture today. New employees are required to sign a document stating that they have read the Core Values document and understand that living up to the Core Values is part of their job expectation.
Your organization's culture is either created purposely or it evolves over time, based on what Core Values individuals bring to the workplace. Your organization's culture can either attract or repel potential employees and customers, and it can also help retain and engage current employees.
Accenture, a global management consulting, technology services and outsourcing company, credits Core Values with shaping the culture, defining the character of their company, guiding how they behave and make decisions. According to , Accenture, "Through the years these simple, yet powerful values have continually guided our decision-making as well as our interactions with our clients and each other." Accenture's Core Values, which appear similar to some other large corporations, are identified below:
- Best People
- Client Value Creation
- One Global Network
- Respect for the Individual
Accenture's Core Values are succinct and easy to remember. Core Values should be something that all employees can easily recall and keep top of mind. Details about each Core Value can be found on Accenture's website.
Whole Foods, the world's leader in natural and organic foods, created Core Values that are longer than a lot of company's, and they also feature them on their website's home page. Whole Foods identifies the following Core Values as "the soul of our company" and the underpinning of their culture:
- Selling the Highest Quality Natural and Organic Products Available
- Satisfying and Delighting Our Customers
- Supporting Team Member Happiness and Excellence
- Creating Wealth Through Profits & Growth
- Caring about our Communities & Our Environment
- Creating ongoing win-win partnerships with our suppliers
- Promoting the health of our stakeholders through healthy eating education
A thorough description of each Core Value can be found on Whole Food's website. Whole Foods credits their Core Values with creating a feeling that they are an exciting and special place to work. The Core Values are impressive and wordier than most. The next time I go to Whole Foods (a favorite of mine) I think I will ask several store employees if they can repeat them. Core Values have the potential to shape an organization's culture; however, to maximize their potential impact, employees should be able to easily remember them and give examples of how they demonstrate them at work.
Beyond Identifying Core Values
Identifying succinct and memorable Core Values is just the first part towards creating effective Core Values. The second part, and what makes them "come alive" and embedded in a culture, is defining them in behavioral terms. People need to know how they are expected to behave at work, or they will interpret the organization's Core Values based on their own. Cynicism about Core Values can grow quickly if people do not understand them, or if they don't think they will be held accountable to demonstrate them, or if those with the most control and power ignore them.
NetFlix - A Model Example of Core Values with Behavioral Expectations
NetFlix has developed one of the best examples of Core Values that I have seen. Netflix's Core Values are so well defined in behavioral terms that it would be difficult for an employee to not understand exactly what each one means. Netflix's Core Values are:
You can see all of these Core Values with clearly defined behavioral bullets and skills on Netflix's website. Positioning their Core Values on their website where prospective employees will find them is an indicator that they are looking for people who embody the "Values" that they "Value."
Making Core Values Valuable to Your Organization
To have impact, Values cannot just be words on a plaque or wall poster - they must be modeled in people's everyday work behaviors, decision-making, contributions and interpersonal interactions. Enron had Core Values, (Integrity, Communication, Respect, and Excellence), but one might assume there was a lack of accountability at the top to demonstrate them.
In addition to identifying Core Values in behavioral terms, they are optimized when organizations focus on:
(1) Accountability. Core Values address how we use our emotional intelligence to accomplish work, versus our intelligence and/or technical expertise, in what we are trying to achieve. In organizations that uphold Core Values, regular and consistent feedback helps everyone remember to "walk the walk," and be accountable for their behaviors. How someone demonstrates Core Values at work should be part of his or her performance review.
(2) A Systems Approach. Core Values have to be aligned with an organization's processes and structure. For example, Core Values should be imbedded in recruiting efforts, talent management initiatives, and performance management system with a "living the Core Values" component.
(3) Rewards/Recognition Strategy. To motivate and reinforce the desired behaviors and skills articulated by a set of Core Values, organizations should recognize and reward those who consistently demonstrate "walking the walk." Public recognition allows others to see how important living the Core Values is to an organization, and provides good role models for others.
(4) Communication Strategy. Core Values should not be a secret - not to employees, customers, potential hires, partners, etc. Sharing Core Values internally (intranet/artwork) and externally (website/marketing and recruiting materials/proposals) manages expectations of everyone in how work will be accomplished.
So, how valuable are your Core Values? Are they a wall poster or a framework for building a great culture? Please share how Core Values have impacted your organization.