30
May
2011

Your Values Statement: A Business Strategy Building Block

Few people understand the importance of defining your company’s values, i.e., being explicit about the principles and behaviors that describe who you are as a company and how you want employees to interact with each other, customers, suppliers and vendors.

 A company’s values define “how” it does business.  A statement of values is important because it helps you select people who are likely to be high performers in your culture and pass on those who won’t be because they don’t match your values.  It helps clarify the kinds of customers you want to do business with, and why it becomes necessary, from time to time, to cut loose certain employees, customers, vendors and suppliers.

 In 2002 I co-authored a book, Building the Awesome Organization http://www.amazon.com/Building-Awesome-Organization-Components-Entrepreneurial/dp/076455400X/ref=sr_1_6?s=books&ie=UTF8&qid=1306093944&sr=1-6,. My co-author and I wrote that the core of a company is its culture. In the the lead paragraph to the chapter on culture, we quoted the CEO of a growth company:

“In the early days of our company, we didn’t understand how to set up the culture at all.  We tried hard to be nice to everyone, but weren’t really being honest with each other.  There were conflicts under the surface, and no one was happy.  Rumors were everywhere.  Backstabbing and insults flew around.  The culture really sucked.  Then we learned to define and write down our values.  We learned what it really meant to use honesty and candor as we tried to resolve conflicts.  We learned how to identify and solve problems.  We were then able to create the culture we really wanted.  In fact, I now see culture as my main priority as CEO.”

Another CEO wrote:

“Before we developed our values statement, when I sensed a misalignment in decisions or behaviors, I couldn’t pinpoint the problem.  But now that the values are written down, we’re recognizing people for living by them.  Now when people go off track, it’s much easier to discuss the behavior we expect and to keep everyone aligned with the values.”

So, you might ask, what are some values that successful companies have identified?

“Our values are simple, but getting them down on paper and sharing them with everyone had had a big impact.  Unwavering accountability to these guidelines and their definitions has really helped in making decisions, providing feedback to employees, and initiating actions.

  • Customer focused – to help our customers succeed and win
  • Flexible – to be nimble and agile in responding to positive and negative feedback
  • Honorable – to act with integrity and do what is right
  • Innovative – to create new, useful, easy-to-use, cool products and processes
  • Open – to be open and honest, to be approachable by others on difficult matters, professionally and personally
  • Passionate – to work hard, play hard, and live hard; to care enough to give yourself to your tasks
  • Persistent – to not give up; to treat feedback as an opportunity to get better
  • Results-oriented – to be driven by achieving concrete results; to measure success by external variables
  • Team-oriented – to work and think well in groups; to respect, listen and value the opinions of others as a critical means for the organization to succeed and function well
  • Winning – to create win-win-win situations.”

SO – What are your company’s values? Defining the values is the second building block of a business strategy that supports growth.  And creating a culture based on those values is one of the primary responsibilities of the CEO.

 In my next post I’ll talk about the third building block, developing a 3 – 5 year vision.