Our colleague in leadership, Harvey Kaufman, edited down one of his longer pieces on alignment so that we might share some of his wisdom and insight here.
A few years ago, I attended a Corporate Social Responsibility conference. As you might expect (although I didn’t) a major focus of the conference was how to market social responsibility efforts to attract business. The case for simply “doing good” as a reflection of an organization’s core values was absent from our discussions. This made me think about the role of values in organizations and why it is important for companies to practice their values in day-to-day interactions with employees and customers.
While there were companies who employed them effectively earlier, core values emerged as an organizational mainstay in the 1970s. They followed the social protests of the 60s, Watergate, the discovery of illegal campaign contributions, widespread bribing of foreign officials by American corporations trying to secure defense contracts, and allegations that multinational corporations were selling sub-standard products in the third world. As a response to what was viewed as a lack of ethics in American business, values gained in prominence. Unfortunately, while the popularity of having core values has increased, their relevance in organizational life seems to have diminished. Too few organizations see their values as an integral part of their success, either in day-to-day operations or longer-term strategy.
Consider some of the areas in which values play a key role:
- Hiring—Companies bemoan the cost of turnover, but few interview for “goodness of fit” during the recruiting and hiring process. In addition to screening for the proper skill set, determining whether or not a candidate is a “values fit” will reduce the likelihood of friction, turnover, and time consuming and costly employee relations work later on.
- Setting Direction—In conjunction with mission and vision, values form an organization’s culture. Leadership must align around a set of behaviors by which they will conduct their business, communicate them and demonstrate them. Effective leaders are conscious of this role and regularly look for opportunities to reinforce the values in interactions. These behaviors, on display for everyone to see, become normative models for all others to emulate.
- Decision Making—Using values as a screen through which to filter difficult decisions sends a message about core beliefs to the whole organization. It also serves as a decision-making model to mid-level leaders. Any decision maker—at any level—who makes decisions that align with the values will be able to justify his/her decision to other stakeholders (and will also derive the fringe benefit of being able to sleep better). While alignment does not guarantee a decision will be implemented, it does provide a defense against criticism and second-guessing.
- Strategy-As leadership teams conduct strategic planning, they rightfully focus on what they need to do to achieve long term goals. They may be interested in what the competition is doing, political ramifications, profitability and expedience. Less often they ask, “How can we build for the future in a way that is consistent with our core values?” Leaders asking this question are setting their organizations up for long-term health and sustainability.
While values are a true reflection of the best leadership has to offer, and can last a very long time, they are not immutable. Industries and societies evolve and organizations may need to re-evaluate their values. Whatever changes are made to the values at these transition points, they must still accurately reflect the actual explicit behaviors favored by the organization to achieve success ethically. In my experience, when leadership teams embark on such a course of honest self-exploration, it is their behaviors, and not the core values, that are most likely to change.
Harvey Kaufman is the founder of Fishbowl Consulting; OD consultants focusing on Management, Leadership, Executive and Team development.