Setting up for success; why company values are so important when creating a good working environment
Building a great team is only half the battle. Developing a culture that creates a working environment which allows your team to flourish — often defined and driven by your company values — will help you win the war.
Sometimes it’s difficult to stop and take a step back from your business. To find the time to think about your company’s journey and mission, as well as future goals and how you plan to achieve them. There’s always so much going on, and so much to do. Wouldn’t the little time you do have be better spent elsewhere?
If this sounds like you, you may need to change your current way of thinking to help improve and grow your business.
Stepping back and taking time out to think about your business’s personality is something that all business owners should do, continuously. A key part of this should be reviewing company values and assessing whether or not the business truly lives by these.
Why are company values important?
Company values are more important than you’d think. They can and should be the beating heart of your business. Providing clear direction and a consistency that underpins everything your business does.
They explicitly state what you stand for and you should work to ensure these values resonate in everything you do. Your values are the foundations for your culture, which is what your employees live and breathe day-to-day.
As a business owner, it’s important that you believe in the values you set. If you fail to live by them in the workplace, you’re likely to find that your team will follow suit. For this reason, it’s important that company values aren’t just thrown together in a quick one hour session; with a group of buzzwords that you think people will like the sound of. “Lip-service” values are likely to have an adverse effect on a business.
Enron, a company now famed for its institutionalised and systemic (not to mention creatively planned) fraud, had company values centred on Respect, Integrity, Communication and Excellence. These were the core pillars on which their ‘Code of Ethics’ was released in July 2000.
As it turned out, it was precisely the leaders in whom the values should have been ingrained the deepest, where behaviours were deviating the furthest. It didn’t take long for these “lip-service” values to become laughable, as the company was exposed on an unimaginable scale. Just 15 short months after the Code of Ethics was published, Enron announced $638m third-quarter losses, followed by a $1.2bn reduction in shareholder equity! Enron — Respect, Integrity, Communication and Excellence Enron — was bankrupt before the end of 2001.
Who are company values for?
Company values play a big part in two key areas; hiring and team communications. However, they also serve additional purposes for multiple audiences:
- They support the management decision-making and communication process: company values can help create alignment behind a single decision, providing a rationale and removing ambiguity.
- They educate clients and potential customers about your business: having an identity that customers can connect with may provide that competitive edge, core values should be at the centre of that.
- They become a primary recruitment and retention tool: candidates are looking for and then go on to flourish in a company they share values with.
Being clear about your company values and vision helps candidates select you, as well as helping you to select the right candidates. It’s an easy win and will save you a lot of valuable time.
Having shared beliefs can hugely benefit the team. Team values contextualise your messages, helping you to structure your communications and make sure you’re driving at the right points. It’s always good to refer back to your values whilst drafting communications. This helps with consistency of message, which can be hugely important for staff. Continuous shifting, disjointed and “change of direction” messaging can be demotivating, often leading to a disengaged workforce. Clear values help safeguard against this.
When should I create my company values?
Many companies wait too long before formally establishing company values. Small business owners will often argue that all their employees will share core beliefs regarding what the business is striving to achieve. This is great, but it isn’t enough. It opens the door to ambiguity. In fact, if you ask many small business owners, who have a written set of company values in place, you’ll often hear that they wish they’d put them in place earlier than they did.
Some argue company values should be set up around the time you’re hiring your first employee. Whether or not you want to do this before your first hire will really depend on how effectively you can hire someone who will share values similar to those you have planned for the company, without formally having them in place.
The main benefit of creating your values before you hire anyone, is that your first employee — who will generally be key in shaping the future of your business — will be on-board with what you’re trying to achieve. The primary drawback is that you’ll be creating your values on your own. As an owner, you might think this is great. However having a second opinion, an opinion of someone who also has skin in the game, can be crucial.
Of course, the opposite is true if you decide to create your values after your first hire. It’s great that you have someone to bounce ideas back and forth with, however you do run the increased risk of hiring someone that doesn’t fit with the general ideals you want to work by.
So, there’s no real “right” time to create your company values. But it’s good to be mindful that if you keep kicking the can down the road, you could find yourself wishing that you didn’t have the benefit of hindsight.
What do great company values look like?
Again there’s no right answer for this; as long as these values feel right for you and are aligned with your company. Remember you’re not the first person to go through this. So why not take inspiration from other companies that are doing it well. Here are some of our favourites:
- Be a host
- Champion the mission
- Be a cereal entrepreneur
- Embrace the adventure
- Be your own customer
- Empower individuals
- Design is not a luxury
- Good work takes time
- Optimise toward ideals
- Simplify and go
- Be a sponge
- Evolve immediately
- Master the fundamentals
- We are on the offense — always
Take comfort in knowing that it’s never too late. In fact, there’s even an upside to developing your company values at a later stage. You have the opportunity to take a highly collaborative approach. Giving you access to more experience and more ideas.