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CORE VALUES: LIVE ‘EM OR LEAVE ‘EM

CORE VALUES: LIVE ‘EM OR LEAVE ‘EM

CORE VALUES: LIVE ‘EM OR LEAVE ‘EM
September 06
10:08 2019

Management by Coaching

By Kimberly Paterson, CEC

CORE VALUES: LIVE ‘EM OR LEAVE ‘EM

Making your core values mean something

The agency’s leadership team was gathered around the table at an off-site strategic planning retreat. The agenda item was competitive advantage. I was facilitating the meeting. In pursuit of the agency’s “special sauce” and how that differentiates it from thousands of others, I turned to the group and asked, “So what is it that you really stand for?”

My question was met with a lot of blank stares, throat clearing and paper shuffling. When the silence became unbearable, the CEO said, “We have high standards of professionalism and integrity.” Then I explored, “Does the agency have core values?” Heads nodded yes and several people smiled with relief. “So what are those values?” I queried. One person responded, “I think professionalism and integrity are on the list.”

“Connor, isn’t there something about customers?” added the CFO. Laptops were opened, others reached for cell phones in search of an answer to the question. When the official values list finally surfaced, it included concepts like professionalism, integrity, teamwork, relationships, trust, and commitment—ideas that are identical to thousands of companies’ values statement.

Without day-to-day commitment, values are empty statements that destroy management’s credibility and inspire eye rolls and cynicism from employees.

Turns out that the agency developed its core values three years earlier as part of a rebranding effort. They formed a task force—including the management team and selected employees from different departments—to take part in the project. Six months of work later, the values, plus a new agency slogan, were rolled out to the staff. Brightly colored promotional items were designed and distributed. The new values were published on the website and displayed in an attractively framed poster in the
reception area. The project was marked “complete” and crossed off the goal list.

All too often, companies invest valuable professional time, mental energy and financial resources in creating values but the real pay-off, which can be significant, never comes.

Six traps

Why do companies’ values programs miss the mark and what can you do about it? Whether it’s driven by a conviction that the process is important or it’s on someone’s list of “shoulds,” companies typically tackle the process with the best of intentions. Despite those good intentions, agencies commonly fall into six traps that tend to derail their values program.

View core values as a list of qualities rather than a code of conduct. For core values to have meaning, they need to be the guiding principles by which the company navigates—even when adhering to those principles may be inconvenient or result in a loss of money, people, relationships or opportunity. Without day-to-day commitment, values are empty statements that destroy management’s credibility and inspire eye rolls and cynicism from employees.

Rely on consensus. All too often, values become a popularity contest with all employees being asked to weigh in. When it comes to defining core values, all opinions are not equal. New employees with little knowledge of the founding principles, traditions, successes and failures that have shaped the company, as well as employees who don’t actually embody the values, simply can’t contribute at a meaningful level. Values are best defined by the CEO and a small team of key people who know the organization better than anyone else.

Never get to the core. Values fall into three categories: table stakes, aspirational, and essential and differentiated. When developing your values it’s important to distinguish between the three. Table stakes are the minimum behavioral and social standards required of an organization and its people in order to be considered a viable organization. They tend not to vary much across companies, particularly those working in the same region or industry, which means that they don’t help distinguish a company from its competitors. Aspirational values are those that a company needs to succeed in the future but currently lacks. If you choose to have values that are aspirational, they need to be managed carefully so they do not dilute the core and it needs to be clear they are something the organization is working to develop. Essential and differentiated are your core values. These represent the essence of who you are, what you stand for and how these qualities combine to make your organization unique. A way to test a value is to ask, “Could another company claim this value as its own and live it the same way we do?”

Where companies get into trouble is that they settle for table stakes and end up with cliché values like excellence, authenticity, teamwork, professionalism and fun—it makes them sound like every other business. The other trap leaders fall into is choosing aspirational values that reflect what they want the organization to be but don’t reflect the current reality. This can be confusing and dispiriting when the values are not positioned as aspirational.

Don’t clarify what a value means and how it relates to the work. All too often values are subject to interpretation and not sufficiently connected to the work. Take a value like “excellence in customer service.” To one person it means delivering a policy on time, to another it means putting customer-related tasks ahead of every other project on their to-do list. Someone else may see it as always taking the customer’s side even when it may be unfair to the insurance company. Zappos sends a much clearer signal in its core value “deliver wow through service.” Wow conveys the organization’s personality and attitude. Employees know to deliver—and customers expect to receive—service that is above and beyond the norm. Once you’ve chosen your values, be sure to consider and articulate:

  • What the value means to the business
  • What it looks like in action
  • How it might be misinterpreted
  • How you will evaluate if individuals and the organization as a whole are upholding the value
  • How it will change your relationships or interactions

Choose too many. Organizations often have long lists of core values. If your list is too long, you’re likely confusing core values with operating practices, business strategies or cultural norms (all of which are subject to change). For example a value like “committed to education” (e.g., requiring staff to attend courses and earn professional designations) or “best people” (e.g., we hire the best people and provide our employees with the tools and training to do their jobs) are operating practices. A value like “diversity and inclusion” has become a cultural norm.

Companies that use core values effectively tend to keep them at three to five because they recognize that only a few values can be truly core and so deeply held that they will seldom, if ever, change.

Fail to operationalize. For core values to take root, they need to be integrated into every aspect of the organization, from determining strategy to selecting employees and business partners. For example, include behavior-based core values in your employment interview process, incorporate them in training and use them in performance reviews and promotion decisions. Be prepared to stand by the values even when it is extremely difficult. Keeping an employee whose actions are inconsistent with the company’s core values—even when they’re a top performer—sends the signal that the company doesn’t take its values seriously.

A game changer

Living your values takes focus, commitment and discipline, and the pressure on leaders to lead by example is never-ending. But when core values become embedded in the organization, they help address some of the toughest challenges businesses face.

Getting employees to understand and meet expectations. In today’s leanly staffed organizations, managers are increasingly reliant on employees to understand and do the right thing. Values are far more effective than rules at eliciting desired outcomes and behaviors and can cover an endless variety of situations. When values become cultural norms, enforcement comes from all employees.

Help employees manage change. Core values are the glue that holds people together, especially during times of change or difficulty. They provide a sense of stability and a fixed set of principles with which to navigate in a world that is constantly changing.

Aid in recruiting and retention. Current research points to “culture and values” as the number one factor in choosing a place to work. When entire organizations are clear about their culture and values and share compelling stories about what they look like in practice, it’s easy for employers and potential employees to see if the fit is right. Values are a significant predictor of employee satisfaction. A study conducted by Spencer Stuart indicated that when employees know and understand their companies’ values they are 51% more likely to be fully engaged at work.

Differentiation in a crowded marketplace. In a competitive business like insurance, values can set a company apart by clarifying its identity. Companies that have strong, clearly articulated values project a level of authenticity that is both appealing and missing in so many professional services firms. Insurance programs and pricing can be matched easily but a strong distinctive culture cannot be copied.

Living your values is hard work. But for those who do, the pay-off can be huge.

Just ask Zappos’ CEO Tony Hsieh, who sold his business to Amazon for $1.2 billion. Hsieh credits the company’s core values as key to its ability to grow and scale the business. When asked what one thing he would do differently if he started the company all over again, he answered, “I would actually have come up with the values from day one.”

The author

Kimberly Paterson, Certified Executive Coach and Master Energy Leadership Coach, is President of CIM (www.cim-co.com). CIM works with organizations and individuals to maximize performance through positive lasting behavioral change. Her clients are property & casualty insurance companies, agencies, and brokers. She can be reached at kpaterson@cim-co.com.

Follow Kimberly on www.linkedin.com/in/kimberly-paterson andtwitter.com/CIMChangeMinds.


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