Authenticity and engagement: 10 ways to make values a competitive advantage8 years, 4 months ago
Meaningful values that are authentic, specific, easily understood and communicated appropriately help companies stand out in their marketplace. By Valerie Di Maria.
A company’s values should be worth much more than the laminated card they are often printed on. They play an important role in helping a company build authentic and long-lasting relationships with employees and in turn, customers. Values also create a foundation that enables a company to survive change or crisis.
Yet many companies do not spend enough time thinking about what their values are—and how those values can truly differentiate them in the marketplace. Rather, they create clichés that may sound good, but wind up being just phrases on a poster. These values sometimes even conflict with a company’s true corporate goals.
The most successful and long lasting companies, such as IBM, GE and Disney, ensure that core values, reflecting what the company truly stands for, are integrated into every aspect of what they do. Values are a particularly dramatic example of the need for actions to speak louder than words. Companies where decision-making is based on strong values, rather than simply the bottom line, have a better corporate culture and more satisfied employees. And more satisfied, engaged employees definitely have a positive impact. In a study of 50 multinational companies, Towers Perrin found that those with high employee engagement had a 19 percent increase in operating income and almost a 28 percent growth in earnings per share over 12 months.
Look what happens when companies forget their values. Starbucks, a company whose values have resulted in a cult-like following, provides a cautionary tale. This popular coffee purveyor was originally built around a set of clearly-defined and communicated values that included high standards, satisfied customers, a commitment to the environment, and having a “soul.” However, after the founder of Starbucks, Howard Schulz, allowed a new CEO to takeover, Starbucks began to stray from its principles.
The company expanded too quickly. It began to resemble a fast food take-out place and became too focused on efficiency. They forgot that they were supposed to make a “human connection” with customers and have a sense of “humanity.” As profit margins began to slip, Schulz took back the CEO position and once again realigned the company with its values. With a renewed commitment to values over profit, Starbucks began to regain sales. Now, it is back on track.
If your company has values that are not truly lived by each and every employee or have been developed just to check the box; if those values are often pushed aside for the sake of revenue, or are constantly changing, then you may as well not have them.
Here are 10 ways to ensure values have meaning for your company:
1. Make Them Unique. Businesses need to analyze the foundation of their organizations in order to create an authentic list of core values. This list should help tell the story of the company and explain what the company stands for. Values should differentiate you from the competition the same way a good brand positioning does. Do you think Starbucks and Dunkin’ Donuts have the same values?
2. Be Authentic. Only sincere and actionable values will make an impact. If a company can’t deliver on the values it has established, the values become meaningless. Disney employees go through a training course to learn the value—and how to’s—of making people happy.
3. Create from the Bottom-up. One way to ensure an authentic foundation is to develop core values with input from all levels of employees, not just senior executives. Employee satisfaction depends on employees feeling they matter to the company. If they are given a chance to help define the company’s values, the results will be stronger, both in terms of the values and the unity of the company. Having a small group of top leaders dictate the company values is not the best approach. IBM is famous for using an all-employee “web jam” to help develop values that really mean something to the entire organization.
4. Be Succinct. What the company stands for, as expressed through its values, must be clearly and succinctly explained. A laundry list of a dozen or so values is too long and not focused. Values should be in language employees can relate to—not corporate-speak. At the 10 company, we plainly state four values: commitment, collaboration, responsiveness, and passion. They form the backbone of our company and are integral to the way our agency works. Employees, clients, customers and other stakeholders should be able to easily identify a company’s values.
5. Have an Internal and External Focus. Values should be meaningful to your clients/customers as well as to your employees. Values that run through a company and create a positive corporate culture will lead to greater internal effectiveness, a stronger performance, and a better experience for the customer. Zappos, which is consistently praised for its customer service, believes that if its employees live by its values, the rest will fall into place. Employees are encouraged to unlock potential by challenging themselves and putting forth new ideas, which translates into benefits for the customer.
6. Be Consistent. All customers should have a common experience which transcends regional, national, and global boundaries. Core values can help establish consistent standards of quality. Apple’s commitment to simple, not complex products, excellence, and innovation, is apparent in everything it produces. Likewise, Nordstrom’s primary value focused on unparalleled customer service is consistent in all of 225 stores. Companies with changing or ignored values leave employees and customers confused or distrustful.
7. Make Them Realistic but Aspirational. A commitment to long-term improvement through values that can inspire is crucial. Successful companies should remain faithful to their values, but look for innovative and new ways to engage those values. IBM’s values: dedication to every client’s success; innovation that matters, and trust and personal responsibility, remain relevant as the company makes transitions in the face of new technological developments and new markets.
8. Commitment is a Non-negotiable. A company-wide commitment is required, which permeates all work products, behaviors, and communication with customers and employees. Senior level executives must also walk the talk to ensure that the company’s values are truly at the heart of all decisions. At GE, if performance is lacking but an employee adheres to the company’s values, they will work with that employee to improve performance. If you are a star performer, but don’t have the company values, you are out.
9. Meaningfully Link to Reviews. Performance reviews and employee recognition programs should be connected to the company’s values to ensure that employees are acting on them. Zappos will terminate employees who do not adhere to the company values.
10. Communicate Through Storytelling. Employees must become emotionally connected to the values of a company. Words on a page like “integrity” and “performance” will quickly be forgotten. Storytelling is a key way to show employees what the values look like in practice. At Women’s Initiative, a non-profit organization where high-potential, low-income women receive training to start and grow their own businesses, “fostering leadership and shared ownership” is an important value. Members know to share specific examples of this and other values such as “create joy in our work” to the leadership where these stories are discussed at regular executive meetings and then communicated throughout the organization.
Companies that create unique and authentic values—and live by them—differentiate themselves from their competition. They are much more likely to attract and retain desirable employees and have sustainable success. If each and every employee fully understands and consistently make decisions based on those values, the commitment will translate to the customer; in turn, into customer loyalty; and ultimately, to the bottom line.
Thought Leader Profile
Valerie Di Maria has earned recognition as a communications and marketing leader in both the corporate and agency worlds. She has held CMO/CCO roles at Fortune 100 companies and has worked closely with prominent CEOs. She is a Trustee of the Arthur W. Page Society and co-led the task force that produced “The Authentic Enterprise,” Page’s report on the evolving role of communications and its strategic importance to CEOs and reputation. She is principal of the 10 company, a new strategic consultancy, based in New York, dedicated to helping C-Suite executives transform their businesses through authentic, results-driven marketing and communications. The 10 brand is backed by the 10 Tenets of Client Relationships, 10% Performance Pricing and a 10% Reinvestment Promise. For more information, visit www.the10company.com.
Valerie Di Maria has earned recognition as a communications and marketing leader in both the corporate and agency worlds. She has held CMO/CCO roles at Fortune 100 companies and has worked closely with prominent CEOs.mail the author
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