Jeff Toister — The Service Culture Guide

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Five Mistakes Companies Make with Corporate Values

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Please excuse my language. I want to write this plainly.

Most corporate values are bullshit. 

In the majority of companies I observe, values are created via a meaningless corporate exercise. Employees are unaware of them, or if they are, the values do absolutely nothing to guide behavior.

The problem is values are misunderstood and misused. They are not just a set of fancy words to dream up and slap on your website. 

Listing "integrity" as a corporate value doesn't mean your employees will magically act with integrity. Enron, a company made famous for a massive accounting scandal that sent executives to prison, listed integrity among its core values

Here are five common mistakes companies make with corporate values, and how you can fix them.

Mistake #1: Executives write them

"We just wrote our values at a retreat," said the executive. "We're really excited about them, but I'm having trouble getting employees to buy-in."

Many leaders have shared this challenge with me.

Employees tend to have a pretty good bullshit meter. The values that leaders dream up while sequestered in a conference room at an executive retreat are frequently boilerplate corporate nonsense.

A 2004 study by Booz Allen and the Aspen Institute found the same themes in almost every company's list of values:

  • 90 percent included integrity

  • 88 percent included customer focus

  • 78 percent included employee focus

The fix is simple. Make value writing a more inclusive process to get a broad range of perspectives in the room. Ask employees at all levels to help write values that actually have meaning.

You can use the same process I use to help companies write their customer service vision statement.

Mistake #2: They're not authentic

A friend lamented her company's new values over lunch one day. She and the rest of her executive team had just written them at an executive retreat, but something didn't feel right.

I asked her to tell me more about communication, which was one of the new values. "Oh, we suck at communication," she said. She explained “communication” had been added simply because it sounded good.

Employees can spot inauthentic values a mile away. 

Values should codify how people really act. Perhaps not all the time, but certainly when things are going well. They should describe actual behaviors, not wistful thinking about how people might act in some distant future.

When writing your corporate values, ask yourself, "Do we regularly do this now?" If the answer is no, then it's not really one of your organization's values.

Mistake #3: Nobody knows them

Let's try a test. 

Try to list your organization's values without looking them up. Now ask your boss, your employees, and your colleagues to do the same thing. See if people can consistently list all of the values.

Values can't guide behavior if they're unknown.

You can fix this by communicating the values repeatedly, using a wide variety of methods. One company I worked with went to great lengths to make sure everyone knew the corporate values:

  • The values helped guide the recruiting process.

  • They were introduced in new hire training.

  • Leaders used the values as a guide when giving feedback.

  • Values were part of the performance evaluation process.

  • The CEO spoke about the values at quarterly all-hands meetings.

Mistake #4: They're undefined

A client once hired me to evaluate how its new corporate values were working. I conducted my study and then presented both good and bad news to the executive team.

The good news was 95 percent of employees could correctly identify all five corporate values. The remaining five percent got at least three out of five correct.

The bad news is nobody had any idea what the values actually meant. Even the executive team disagreed on their meaning.

One value was integrity.

  • The CFO felt integrity meant you don't steal. 

  • The CMO felt integrity meant you did the right thing for customers. 

  • The CEO felt integrity meant you were a good member of the community.

None of these definitions were inherently bad. They were just different. Values can't consistently guide behavior if they don't have consistent definitions.

This problem can be fixed by attaching clear definitions to each value. 

When I work with companies on defining their culture, I ask leaders to tell stories about everyday behavior that aligns with the values. These stories help leaders communicate these values more effectively.

Mistake #5: They're not prioritized

Your employees will encounter tricky situations where one value comes into conflict with another. They could find themselves at an impasse if the values aren't prioritized.

Disney theme parks provide a great example. Here's how Disney's four values for theme park cast members are prioritized:

  1. Safety

  2. Courtesy

  3. Show

  4. Efficiency

I've seen a first-hand example of these prioritized values. Here's an excerpt from Getting Service Right, recounting an experience riding the Twilight Zone Tower of Terror ride:

Everyone had just belted into their seats when a young boy started crying and protesting that he didn't want to go on the scary ride. The cast member playing the "demented elevator operator" immediately broke out of his character and invited the boy to step off the ride. He assured the boy's concerned mother that he'd keep a close eye on her son while she enjoyed the ride. When we returned and the elevator doors opened, the cast member was waiting with the now-smiling boy standing next to him.

Disney's priorities clearly guided the cast member's actions. Safety is the first priority, and this was evident when he delayed the ride and made sure the boy exited safely. The second priority is courtesy, so the cast member momentarily paused his scripted routine to politely address the young boy and assure the mother her son would be safe. The show is Disney's third priority, so the cast member quickly resumed his act once the first two priorities were addressed.

Take Action

Corporate values don't have to be empty words.

They can become useful guides for hiring, training, and coaching employees. And when employees encounter an expected situation, strong values can help point them in the right direction.