Why values matter (and bad things happen when they disappear)
If you’ve been around any business you’ve seem them - mission, vision and values. Sometimes they’re prominent, even on the first page of a website, other times they’re in the About us page. Sometimes they don’t show up anywhere. And yet, our values are what determines how we live our lives and how we conduct business. Supposedly, they’re the place we turn to when we have a difficult decision to make. We’re supposed to stick to our values, do the right thing and do right by others as well.
But for most businesses - sadly - vision, mission and values are things that you look at every now and then, reveal with a fanfare and then they disappear into the background as we focus on our daily tasks.
Here’s the problem: if you don’t consciously live by your values and conduct your business by your values, you will start seeing decisions and actions driven not by honesty, and integrity, and transparency - but by fear and self-interest. And that’s when things go wrong.
Where do values fit into the grand scheme of things?
Most business owners understand instinctively that mission, vision and values are the most fundamental driving forces behind a business. But I’ve very seldom seen a clear and simple explanation for how they work together, and how they help you run a business.
Here’s my take:
We embark on building a business to make money. But the reason the business works is because we’re creating a better world - we’re solving a problem or helping our clients achieve something. That’s our vision - a vision of a better world where that particular problem is solved.
Our mission then, is to get us to that better world, and our values determine what we will - and won’t - do in the process of getting there.
For my business, my vision is of a world where more solopreneurs and small business owners have a successful business and have a life they love. My mission is to develop the tools they need to do that, and help them build a successful business without giving up their lives. My values include caring about people first and never lying about what my products and services can do for my clients (otherwise known as hype).
What happens when we lose sight of our values?
Most organisations make a valiant effort at defining their values - and they mean it. Honesty, integrity and transparency are values that most companies uphold - and they’re good values to have. People first is a value that I hold dear to my heart and my most successful clients do as well.
But values can easily get lost when we’re too busy, when the pressure mounts and we can’t make the time to think about why we’re doing something the way we do. And that’s when other factors determine how we make decisions - and that’s when things go wrong.
When we lose sight of our values, we make decisions based on our instinct for survival.
At the heart of it, values determine an organisation’s culture. If you work in an organisation where a mistake is rewarded with punishment, you will make decisions based not on your values, but on whether you’re going to lose your job, or lose out on a promotion or a bonus. If your income is based only on meeting your quota, you will make decisions based on whether that will help you meet your quota or not. You will - out of necessity - do things that help you survive, even if it means that other people get hurt in the process.
When that happens, the organisation’s true values emerge. The true values are not honesty, and integrity, and transparency. The true values are hitting the numbers.
That’s why we see organisations like Wells Fargo adopt and encourage dubious sales tactics to boost their sales figures. That’s why we see financial meltdowns like the 2008 subprime mortgage crisis. Those organisations lost sight of their true values and put profit above everything. The true values of the people leading the organisation were not building a sustainable, profitable business that helped others - the true values were greed and fear and preservation of self regardless of the cost to others.
True values trickle down
Every person has values, but in a business the organisation’s values are determined by the person at the top. Regardless of what the organisation defines as its values, the true values originate with the leader and trickle down from there. The extent to which the leader reinforces those values determines how well the values are lived by the people working in the business.
I’ve seen the impact of this first-hand in one of my clients. The owner of the business truly believes in - and lives - their motto of people first. New employees in the business have a tough time getting used to this - some of them come from environments where any mistake was punished with repeated threats of losing their job. But when they start to understand how people first actually works, and that everyone makes mistakes and what really matters is what you do about it - magic happens.
These new employees no longer live in fear of losing their jobs, or being put down, or snide remarks from managers or colleagues. They start working together with the rest of the team, they understand that their manager (and ultimately, the business owner) has their back and that, together, they can deliver a better service to their clients.
The result? Their business is booming because people love doing business with them even when their prices are consistently higher than the competition. Clients know that they’ll get a friendly voice on the phone, the company will bend over backwards to help and service is on time with superb quality product.
How do we lose sight of our values?
I truly believe that every organisation means it when they originally set out their values. I also believe that no one comes to work to do a bad job, or to make other people’s lives a misery.
But we can easily lose sight of our core values - and start making decisions based on other factors - when the values are not lived, breathed and reinforced every day from the top down. That does not mean that it’s only up to the owner or CEO of the business to hold the values up - it also has to be how his or her direct reports live their lives. And the people working for them, and so on down.
We lose sight of our values for two reasons:
the values are not reinforced from the top down; and
when fear rules our lives.
If you’re almost always afraid of losing your job, you will (mostly) do what you need to do in order to preserve your livelihood. If you’re afraid of being ridiculed or pointed at because you’re not meeting your numbers, you will instinctively do whatever it takes to boost those numbers.
Take away the fear, and see the values lived every day from the top on down, and magic truly happens.
Running a business based on values
Running a business (and living your life, for that matter) based on your values shouldn’t be difficult. Our values should be intrinsic drivers for how we make decisions and we should naturally make decisions without consciously having to consider them.
But not everyone is fortunate enough to understand how this works. They may come from an environment where they were living in fear of making a mistake, or they just don’t know how values translate into good decision making.
I see this most often in new managers. Many managers are appointed to their role because they performed well in a previous position and showed some leadership traits. Most are then elevated to a management position with little relevant training, and now they have to lead a team and make decisions that affect not just themselves. These new managers will use whatever tools and knowledge they’ve learnt so far, but the true values of the organisation is what really drives their decisions and leadership style.
This is where the new manager’s boss - and ultimately the business owner - can make all the difference between having a great manager or someone who creates more trouble than they’re worth. Invest in showing those people how to act from a place of caring, from your values, and you have a winner. Not everyone will respond as well as you would like them to, but those that do are a true asset to you and your business.
Do I need to formalise my values?
If there are more than a handful of people in your business, you need to.
When you’re on your own, your values are instinctive. You know what they are and you mostly conduct yourself according to those values (all of us make mistakes).
But when there are two people in a business, there are two sets of values. Every person you add brings in a new set of values. And beyond about five people a new set of values emerge - that of the group, or the business. Don’t leave your values to chance, hoping that everyone understands and places the same importance on values as you do - get the group together and write them down.
It’s just like a business culture:
A business culture is like a garden - you can weed and feed it and end up with something beautiful. But leave it to grow wild and it will do exactly that - grow wild.
So formalise your values. Write them down. Then show others how to live those values by example. And when they do something questionable, use your values to show them how to do it better.
With thanks to CL, who is building one of the most amazing businesses in the world because he cares.