Brought to you by Jeff Thoren, DVM  

The complexities of work-life are increasing every year while pressure mounts to increase profits and accomplish more.  What too often gets squeezed out are the needs of the very human beings who are responsible for making a business profitable.  So it shouldn’t be particularly surprising when we as leaders notice that productivity is down and turnover is up. 

“It puzzles me how little attention we give to developing this thing called values in our organizations.  We expend a lot of energy “doing” things - building and executing programs, raising money, and developing systems and structures.  Yet, we spend so little time developing the heart and soul of our organizations.”  - J. David Schmidt

Here’s this month’s feature ...

Hidden Value by Charles A. O’Reilly III and Jeffrey Pfeffer

From -- HBS Working Knowledge -- October 16, 2000

Highlights from the article:

• A handful of companies in different industries have discovered the key to fully using their talent and unlocking the motivation of the people they already have in their organizations.  How?  By starting with a set of clear, well articulated, widely shared values that provide a basis for competitive success.  These values come first, even before the “bottom line.”
    

• A value is typically defined as "a belief about what is worthwhile or important ... principles or standards that are seen as important by a person or group."  In this sense, all organizations define what is important for people to pay attention to (e.g., cost control, profit, customers).  Organizations have values, whether formally articulated or not.  For a person to succeed in any organization, he or she has to understand what is really important to that firm -- its values.  People do this by looking carefully at what's actually rewarded, observing how people get ahead and who gets promoted, and watching and listening to what senior managers do and where they spend their time.  The policies and practices of the company signal clearly what is valued and important.
    

• Unfortunately, too often what managers say and what they do are ambiguous at best and contradictory at worst.  The underlying values of the company will invariably become clear, even if managers aren't explicit about them or deny that "values" are important.  Too often these implicit values take the form of "follow orders," "please your boss," "don't take risks," "don't fail," "results count, people don't," and "act in your own best interest because the organization won't."  Of course, these aren't the values that are printed on the three-by-five-inch laminated cards, but they are often the unspoken but widely shared values that people understand.  Thus, regardless of what the mission statement or management says, employees will inevitably come to understand how the company operates and what the real values are.  All organizations have values; the only question is how explicit they are about them.
    

• What happens when we compare an average business like this with a values-driven one?  What is not different is the importance placed on performance and excellence.  What is different in values-driven organizations is the emphasis they place on two dimensions frequently absent from their competitors: a sense of purpose -- why what they are doing is important -- and the importance and dignity of people.
    

• Unlike companies that follow the conventional strategic management model, values-driven companies do not begin with an intellectually-driven exercise to define their strategy and then align the organization to reflect this choice, with management policies decided as an afterthought.  Instead, they begin with a set of clearly articulated values that are reflected in how employees are to be treated.  These values and philosophy drive the management practices of the firm and help define its strategy -- almost the exact opposite of what conventional wisdom teaches.

For the full text article, go to ...
http://workingknowledge.hbs.edu/archive/1734.html

The Value of Values

Starting with values makes sense from a human as well as a business standpoint:

The human piece.  Everyone wants meaning in their work.  Everyone wants to be part of something excellent, where they’re making a contribution to something that’s important to them.  This can only occur when there is a values “match” between the individual and the organization or team.  If we can tap into people’s values, we unlock an amazing reservoir of energy and creativity.

The business piece.  Values alignment leads to increased productivity and business performance.  Shared values act as a gyroscope for an organization, keeping it focused on its core capabilities, providing a framework for making difficult decisions, and keeping the organization pointed in the right direction.  In high performance team experiences, values are being honored.  And finally, values provide a cornerstone for the design of a selection process that helps attract the right types of people.

Here are some of additional benefits of a values-driven approach to business:

• Values-based organizations are often more sustainable than those oriented purely or primarily for profits.  In fact, values-based organizations are often more profitable.  Studies of companies and organizations achieving long-term success show how pivotal a set of clear common values are to organizational health and performance.
    

• Organizations that align their corporate values with the values of employees, and vice versa, are more satisfying to work in, are more successful, and are more focused on the needs of their employees and customers.  Organizations that don’t have this alignment tend to be more inward looking, bureaucratic, and stressful.
    

• The right values will mean commitment, balance, and the ability to accept change.  The wrong values will mean instability and resistance to needed change.  Organizations can’t afford to overlook or underestimate the importance and influence of values.
    

• Leadership is all about connecting, at a fundamental level, with the hearts and minds of the people in the organization in order to move faster, innovate easier, and ultimately be more productive.
    

• The practice of leading from values produces behavior that advances the well-being of all and prevents harm to both the individual and the organization.  In the end, it is the substance of healthy working relationships and builds a sense of community within the organization.

“By living and teaching values that tap into the most human of employee’s own values, values-driven leaders encourage the heart.  Core values compatibility energizes an organization.  People at work don’t just have a job; they have a cause.”  - Leonard L. Berry

Next Month

How can a people-centered strategy lead to business transformation?  Learn how Best Buy’s leadership development and employee engagement efforts are paying off.

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