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Values are enduring, passionate, and distinctive core beliefs. They’re guiding principles that never change. Values are why you do what you do and what you stand for. Values are deeply held convictions, priorities, and underlying assumptions that influence your attitudes and behaviors. They have intrinsic value and importance to those inside the organization. Your core values are part of your strategic foundation.

More and more companies are articulating the core beliefs and values underlying their business activities. Strong values account for why some companies gain a reputation for such strategic traits as leadership, product innovation, dedication to superior craftsmanship, being a good company to work for, and total customer satisfaction. A company’s values can dominate the kind of strategic moves it considers or rejects. When values and beliefs are deeply ingrained and widely shared by managers and employees, they become a way of life within the company, and they mold company strategy.
They’re also called guiding principles.

Herb Kelleher, former CEO of Southwest Airlines, speaks about core values:
“We always felt that people should be treated right as a matter of morality.Then, incidentally, that turned out to be good business, too. But it didn’t really start as a strategy. It began with us thinking about what is the right thing to do in a business context. We said we want to really take care of these people, we want to honor them, and we love them as individuals. Now that induces the kind of reciprocal trust and diligent effort that made us successful. But the motivation wasn’t strategy, it was core values.”


Elements of effective organizational values

Developing core values can be tricky because you’re transferring something that’s very personal into a group and business setting. As you’re working toward developing a values statement for your organization, beware of the personal and emotional connection most of your team members have with creating the values statement. Here are some guidelines:

- One word isn’t enough to convey the real meaning of a value. Create phrases, but not paragraphs.

- Make these values specific, not generic. More than one word is needed to make each value specific.

- Some values-driven language may be part of your mission statement. That’s fine, but consider not repeating what you’ve covered elsewhere.

- Values need to be shared. While you don’t need consensus from everyone in your organization, you do need agreement from senior management.

- Keep the list of values between five and seven. They need to be memorable to your staff, so having a few statements is better than having so many that nobody remembers any.

To illustrate these guidelines in action, look at Herman Miller, an innovative furniture company.

- Rather than using the word excellence, Herman Miller chose the word performance, and explained what that means this way: “It isn’t a choice, it’s about everyone performing at his or her own best; we measure it; it enriches our lives and brings value.”

- Rather than using the word teamwork, Herman Miller uses the word inclusiveness, and describes it this way: “To succeed as a company, we must include all the expressions of human talent and potential . . . when we are truly inclusive, we go beyond toleration to understanding all the qualities that make people who they are, that make us unique, and most important, that unite us.”



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Developing or updating your organizational values

You don’t set or establish core values. You discover them. The exercise in this section helps you focus on discovering shared values within your organization by starting with individual’s values and moving up to the organization.

You can use this exercise to update your current values statement or develop a new one. Focus this exercise on answering three questions:

•  What are the core values and beliefs of our company?
•  What values and beliefs guide our daily interactions?
•  What are we really committed to?

Evaluate your values using (Figure 1) below. Because your values are a key foundational element to your company and strategic plan, you want to be doubly sure they’re the right ones.

Figure 1: Evaluating your values statement.

Identifying Authentic core values Yes No
If you were to start a new company, would this core value be part of its foundation?    
Will you continue to stand by and hold this value no matter what happens in the competitive environment?    
Are you willing to stand by this value no matter what the cost - for example, lost clients or lost revenue?    
Do you believe that employees who do not share this value should continue to be part of your company ?    
Do you demonstrate this core value in your leadership?    
Would you sell your company before giving up this core value?    
Do you apply this core value in your personal activities?    
If you could do anything in the world, would you continue to apply this core value to your productive activities ?    


Here are the steps to developing your organizational values statement:

1. Solicit a list of five to seven core values from each of your key staff members and senior management team.
Ask each person to provide the list of values to you individually through a survey or e-mail by answering the questions above. Unlike with the mission and vision exercises, values are best solicited individually instead of in a group to begin with. Request that they explain each value they provide.

2. Merge the lists provided by combining values that are listed more than once.
The purpose here is to develop a draft list of values. You may have more than five to seven at this time.

3. Bring the group together to discuss the list of values.
Ask people to comment on what is listed. Revise and modify until you have generated a final values statement.

4. After you have your list of organizational values, use Figure 6-2 to evaluate each value for effectiveness. You can do this as a group or individually.

5. Put the finishing touches on the values statement and communicate it across the company.

If you need some ideas to get started on discovering your organizational values? See (Figure 2) below for a bunch of words that you can use to stimulate those gray cells. Give a copy to your values team to help them generate their individual list. Acting on your organizational values Developing a set of values is one thing, living by them is something completely different. Having a values statement that’s all talk and no commitment undermines your leadership and the management team’s credibility. Here are some ways to bring your organizational values to life:

- Communication: Send a letter to every employee; develop a brochure; visit every office to personally explain the values; post the values in a public area.

- Training: Develop short training sessions about the different value topics. If that sounds like a lot of work, consider holding a brown bag lunch focused on one of the values. Allow an open discussion about what it means to act on and live by each value.

- Reinforcement: Engrain your values through performance reviews, in your goal statements, and in your everyday language.

- Rewards/Recognition: Host contests to give employees a fun reason to discover and integrate the values.

- Hiring: Use your values statement as a guide in your hiring process. Structure interview questions around each one of your values to ensure that you’re bringing people into your company who align with your corporate culture.

- Alignment: Look at your values and figure out specific ways to align daily activities with the values. For example, if one of your values is innovation, then install a system to reward innovation. If customer satisfaction is a value, then set a policy of 100 percent money back guarantee.

Figure 2: Ideas, words, and phrases for your values statement.

customer service
100% effort
personal growth
company growth
community responsibility
continuous improvement
embracing change
personal responsibility
customer care
customer expectations
rewarding work
employee participation
maximum value
stand behind
long-term relationships
the right thing
referrals and
high expectations
high performance
customer satisfaction

From the Book " Strategic Planning for dummies - By Erica Olsen" This is an excellent book and is highly recommended if you wish to learn more about strategic planning.

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