The Impact of Our Core Values: Good and Bad

Now that we have an outline in place for basing our organization’s foundation on core values - the simple practices we’ll need to provide for acting on those values, the consistent example we’ll need to be in living them out, and the sustainable expectation for how our values are part of everything each team member does daily - let’s look at how much impact doing each of these things can have. I’ll start by sharing an example of what can happen when core values aren’t clearly communicated internally, or even worse, anything remotely resembling stated values ends up being empty words that are routinely violated by the organization’s executive team. After that, I’ll provide several examples of companies that Cindy and I have watched firsthand as they’ve built strong cultures around their core values. Then, before tying this all together with a simple framework for building a great culture around YOUR core company values, I’ll challenge you with something you should consider every single day you carry the responsibility of leading a team.

Make no mistake though, I’m certainly not suggesting that any of this will ever be easy. Regardless of how big (or small) your organization is today, building specific values into everything you do will require a tremendous focus - constantly! Depending on where you are and how much you’ve ever talked about your values with your existing team, this may initially be an uphill battle. That said, the juice will definitely be worth the squeeze. I mean, what’s the alternative? Forever struggling in every aspect of our business simply because we weren’t willing to develop the self discipline to identify and live out a set of values…? That sounds miserable to me, and I’m guessing it does to you as well.

For anything we’ve worked through to this point or the simple framework we’ll close with to have any lasting impact, there are a few things that must happen. We’ll need to develop a realistic picture of exactly where we are currently. This isn’t always fun and will require getting the feedback we need to hear rather than just the input that feels good. We’ll also need to accept the responsibility for driving any changes that need to be made; no one is coming to our rescue. And we’ll need to fight the urge to justify not taking action. There are just as many excuses for a large company to stick with the status quo as there are for a small one. Don’t fall into that trap! Large organizations tend to have more resources available - personnel and finances, specifically - but that generally means there are a lot more team members we’d need to reach with our message and help change their behaviors. Smaller companies are often more nimble, but often have every team member spinning multiple plates even before attempting even the smallest change.

I’ve often heard the adage that the best time to plant a shade tree was twenty years ago and the second best time is right now. We can’t change anything we’ve done to build a foundation on our core values leading up to this point. If you’re happy with where you are today, great! Let’s build on that. If you already see opportunities for improvement, there’s no better time than now to start the process. With all that in mind, let’s look at a bit of a cautionary tale…

In contrast, the company I alluded to earlier has experienced turnover in almost all of their critical roles in less than a decade - and some of those positions have been filled multiple times. While two of these were planned retirements, the rest were not. Of those who didn’t retire, at least six new small businesses now exist within the same area - all serving the same customer base. On top of that, I’m aware of at least a dozen highly skilled and highly motivated employees who now get their W2 from a competitor. There were a few other retirements in the mix, but at least one of those was almost a decade early and largely because he no longer felt like he had something to strive for; what he valued and what the company he had served for so long valued were no longer aligned.

Interestingly enough, nothing in that organization changed overnight. If anything, change took far too long and rarely had the teeth to make a positive impact or be sustained over time. And since the company had developed a solid reputation (and balance sheet) over many decades leading up to this, the folks who had the final say on critical decisions seemed to be more tuned in with how great things had been than where they were at present. With that in mind, let’s look at how quickly that slope became slippery.

The People Involved Will Change, The Values Can’t

Make no mistake, turnover is always going to happen. Part of our responsibility as leaders is to plan for that. And in planning for each type of turnover we’re sure to experience at one point or another - be that a retirement, a termination due to unacceptable performance, or someone leaving for a competitor or to become our competitor - our core company values can’t change. While the organization I’m referencing didn’t abruptly abandon a set of longstanding values that had been in place and discussed openly for generations, small changes (that every business faces) were occurring routinely and had a compounding effect over time.

I remember being awestruck when I got a firsthand glimpse of the caliber of people heading up each part of this small-to-midsize business; I had seen organizations four and five times their size with just a fraction of the talent and expertise in each business unit. And the most interesting part was that none of those folks were near the end of their careers, even though they had each been with the company, or at least in that specific industry, for at least a decade. The boss was relatively soft spoken and was an absolute master of the craft the organization had been built on. But like many of the more reserved folks in leadership roles, he didn’t enjoy conflict and he cared a lot about his long tenured team so he rarely addressed performance that didn’t quite live up to the values he and the most senior employees held dear. Since the majority of the team was so good at what they did, reasons for him to initiate tough conversations were rare; the few folks who were willing to toe the line were essentially policed by the rest of the team, but even those few were extremely skilled in their roles.

Like all companies though, a succession plan was necessary and was being implemented. In even the best scenarios, the new boss won’t have the same expertise right away and will have to earn buy-in from the team they’ll soon be leading. Both require time and an incredible amount of intentional effort; neither happen automatically. If the person taking the reins isn’t willing to develop strong relationships with the key players on the team around them, they often end up getting only the feedback they want to hear rather than what they absolutely need to hear in order to grow into their role and earn the respect necessary to truly lead. And if relationships are never built, top performers will not stick around. The best people in any industry can make a great living just about anywhere they want, the core values of the organization are often exactly why they stay or go…

Albeit not all at once, a few of the long tenured and highly skilled team members did move on. Replacing their talent was difficult enough, but replacing it with people who would be as loyal as the folks who left once were just wasn’t possible. This led to an almost immediate drop in how the employees who occasionally chose to drop the ball on upholding the company’s values were held accountable. Since several of the team members who had done this previously had moved on, the bosses were the only ones left to do it. The one who had earned respect over the years was a bit reluctant to and the one who hadn’t earned respect was far too willing to, and you can guess how well that was received.

With the slope becoming more and more slippery, a few other key players left. Of those who had left, one started a small business in direct competition. As the more established company’s culture drifted away from the values that were once held so close, several highly skilled team members moved to the new company - largely because the owner had earned their respect around his core values.

You can look in any direction today and find an article detailing the woes of finding top talent in any field. As this issue has become more prevalent and as those with the most in demand skills have become able to write their own price tag, a major separator between the company that throws bags of money just to attract a candidate and one that has great team members asking to join the team will be how the organization’s foundation has been built on core values, how expectations for modeling those values have been communicated internally and externally, and how everyone involved is held accountable to those values - by the leadership team initially, and eventually by each other. With this example in mind, let’s consider a few with cultures built on strong values have attracted top talent (and great clients) instead of creating their own competition - stay tuned!