Corporate values should add more value

Where a company professes to revere customer service as a core value and customers are not treated well, it can lose valuable business. When collaboration is a core value but managers engage in rancorous disagreements, large contracts can be lost. If respect is a core value but managers show disrespect to employees, valuable employees may leave for organisations that do treat their employees well.

Competitive advantage

Core values have become increasingly important for competitive advantage. Values help to set a company apart from the competition. Companies today need to differentiate their products and services to win business against lower-cost global competition, especially from larger developing nations such as China, India and Brazil. Government and public service organisations need to live up to core values to deliver on their mandate to citizens and communities.

Many companies put much effort into developing a set of business principles or core values which help to shape effective employee behaviour in support of corporate objectives. However, core values cannot be plucked out of the air by the management team and human resources; they need to support a company's strategic objectives.

Companies should spend time in defining the core values that will change employee behaviour and make the company more effective. Patrick Lencioni, a management consultant, says core values are the deeply ingrained principles that guide all of the company's actions. ("Make your values mean something", Harvard Business Review, July 2002), "They serve as its cultural cornerstones," says Lencioni.

Gap too large

Core values programmes which encourage employees to adopt new behaviours through discussion and dialogue tend to be more successful than those implemented by sending corporate missives to employees exhorting them to live the new values. Employees may see the company's new values such as Teamwork, Quality, Respect, Collaboration, Customer Satisfaction and Innovation as important but become cynical because the values are not practised in their organisation. The gap can be too large between what actually happens in the company and how the company aspires for its employees to behave.

Employees' attitude to change is another form of resistance to adopting core values. People don't like change and find it difficult to modify their behaviour. As authors David Rock and Jeffrey Schwartz, in an article "The neuroscience of leadership" (Strategy + Business published by Booz Allen Hamilton, Issue 43, 2006) note, "Businesses everywhere face this kind of problem: success isn't possible without changing the day-to-day behaviour of people throughout the company." They point out that in studies of patients who have undergone coronary bypass surgery, only about one in nine people adopt healthier lifestyle habits.

This is a challenging statistic for anyone who wishes to change individual behaviour in organisations, let alone change the way a whole organisation behaves.

Ways to implement

Despite the difficulties, there are ways to implement core values programmes that stand a higher probability of success. Companies need to build their core values into everything they do -- reward systems, performance appraisals, customer service and induction programmes. Managers should also use every opportunity to tell employees stories that embody the company's core values, especially in induction programmes.

Imaginative and fun ways to communicate core values are important for engaging employees. But "feel good" programmes through presentations by the CEO, senior managers and HR or only publicising values on T-shirts, coffee mugs and wall posters can be ineffective if they are the sole means to implementing core values.

New approach

A new approach to individual change is for managers to encourage employees to discover their own insights into core values and desired behaviours. Authors Rock and Schwartz believe that leaders can effectively change their own or other people's behaviour by leaving problem behaviours in the past.

Instead, they should focus on identifying and creating new behaviours through painting a broad picture of the desired change and encouraging individuals to identify the changes that they will need to make. Focusing their attention on their own insights, they say, helps individuals to change their mental models. Workshops, for instance, in which employees can discuss and gain insight into core values assists them to understand the reasons for new behaviours and helps them to adopt the values in their work lives.

Implementing a core values programme requires effort and reinforcement by management over the long term. In short, it takes commitment and hard work to encourage employees to act differently. Companies which realise that core values can make a difference to their bottom line will put in the necessary time and effort, and will reap the benefits.