Company core values define the firm’s business beliefs and the guiding principles that form the basis for the direction, and manner of its functioning. Company core values define its DNA and help in differentiating it from the competition. The core values, through their determining influence on the organization’s business direction, influence its strategy formulation and decision-making.
There are several examples of organizations with clearly enunciated core values. One of Google’s core values is being ‘employee-centric’. Google, therefore, promotes a creative and flexible work environment. Amazon emphasizes as its core value the relentless pursuit of customer satisfaction and operational efficiency.
It would not be an exaggeration to say that the company core values, in effect, define the company. The core values determine the firm’s mission statement, influence the character of the current and future employees, influence how the organization interacts with its customers, and determine its relationships with stakeholders and business partners.
An organization needs to clearly define the core values that it believes will guide its every action. These core values should then be communicated clearly and transparently to all the employees, customers and stakeholders. Then on, every person in the organization and every action of the organization should be aligned to these core values. The company’s work culture should accurately reflect these values, and all its employees, customers and stakeholders should be able to see strict adherence, in all the organization’s activities, to the company core values.
Work Culture and Core Values
In broad terms, the work culture in an organization is a key determinant of its success. Fostering a work culture that reflects the company core values is the starting point for building a strong business. If the work culture imbues the employees with positivity and helps them in being productive in their work — the employees are engaged and their productivity increases —customers and other stakeholders will actively seek out the organization and the business will grow and earn profits.
Although it is relatively easy to state what products the organization manufactures, or the services it delivers, it is very difficult to define a company’s work culture. Culture is intangible and permeates the entire organization. The company core values help determine its work culture, define the company’s mission, and become the reason for its existence beyond its tangible offerings of products manufactured and services delivered.
What are Core Values?
The company core values are operating principles that are deeply ingrained in all its actions. The core values are the company’s basic principles, beliefs and guiding philosophies that power all the business decisions in the company. These principles act as its cultural guideposts. Since the company core values define its reason(s) for being, they should be sacrosanct and should never be compromised. No consideration of convenience, short-term expediency or monetary gain can be a reason for compromise on the core values. Quite often, the company’s founders help establish its core values; Hewlett-Packard’s ‘The HP Way’ is a succinct way of conveying its core values — its emphasis on quality and on delivering world-leading products and services.
However, does this mean that the company core values are static? No. A company may need to define a new core value to account for a changed strategy to address the demands of a changing market or a changing industry. When defining new values to address changed realities, it is important to ensure that there is no dilution of the guiding core values. Any dilution or contradiction would confuse employees and bring into doubt the organization’s commitment to its stated intent and mission.
In essence, the company core values are the beliefs, philosophies, and principles that drive your business.
Importance of Company Core Values
Company core values, also sometimes referred to as corporate values, enable people in the workplace to work together as a team towards a common goal, guided by a set of unifying principles and beliefs. The influence of corporate values is felt everywhere in the organization:
- The values help marketers build the brand and plan their marketing strategies.
- Corporate values provide clarity to the sales team to communicate effectively and present convincingly the products and services of the organization.
- They determine the organization’s quality of customer service.
- Corporate values align employees’ efforts, provide motivation, enhance engagement and boost productivity.
- Core values encourage product/service innovation and business growth.
- They ease the flow of internal and external communication.
- The core values act as beacons, guiding strategy and decision-making by the leadership.
- Shared corporate values help attract like-minded customers and employees. This boosts customer loyalty.
- Values guide the HR team in building company culture and attracting top talent.
- A well-defined set of core values constitutes a source of competitive advantage.
Clearly, there are good reasons and sufficient motivation for organizations to invest time and effort in defining their identity, their beliefs, and their core values. In fact, in a study conducted by the US-based HR consulting firm Robert Half International Inc, it was found that 35% of the workers surveyed said that they would forego an otherwise perfect job if the company culture did not match their expectations, underscoring the importance of core values and work culture.
Defining Company Core Values
It would be clear from the discussion thus far, that the very meaning of core values implies that these values, once defined, become binding as a set of fundamental, strategically important, guiding beliefs for a broad group of people across the entire organization. Arriving at business core values might not be feasible through a process of consensus-building. It will necessarily need to be arrived at after thorough deliberations by a team comprising the top leadership and a select, representative group of employees and founders (if applicable). The discussions and deliberations need to be extensive, and the exercise of deciding the guiding values should not be undertaken with any constraints of time imposed on it. For the business core values to be effective, they should be unique to the company and aligned with its individual experience. The values should be relatable, easy to understand, and provide a sense of purpose. The employees should be able to connect to the core values, and the values should support the employees’ professional aspirations. The connectedness of the core values improves engagement, increases retention and creates employee advocacy and influencing for the values.
The most preferred way of communicating an organization’s core values is through the leadership team living the core values. The core values should be seen to be lived by the leaders after they have been communicated to the firm through the usual means. Communicating and instilling the values should also form an intrinsic part of the hiring and induction process. Visible recognition of employees for their contributions to furthering the company’s core values also helps reinforce the values and encourages and enhances commitment to the values.
Finally, once the business core values have been defined and communicated, they should then be woven into every aspect of the organization’s operations, to make them truly meaningful and effective. The organization should, however, remain open to feedback and revision of the values, if required, due to changed circumstances.
Examples of Core Values
Some examples of core values are:
- Continuous Learning
- Task Ownership
- Constant Improvement, etc.
Google provides a good example of a company that has articulated the meaning of core values clearly, in language best-suited for its mission – “Ten things we know to be true”. These values guide every aspect of Google’s business operations:
- Focus on the user and all else will follow.
- It’s best to do one thing really well.
- Fast is better than slow.
- Democracy on the web works.
- You don’t need to be at your desk to need an answer.
- You can make money without doing evil.
- There’s always more information out there.
- The need for information crosses all borders.
- You can be serious without a suit.
- Great just isn’t good enough.
Nike communicates its business core value using a simple message – “Bring Inspiration and Innovation To Every Athlete”. Nike also has a simple list of values:
- We dare to design the future of sport
- A team that’s empowered, diverse and inclusive
- The world is our community
- A fair sustainable future for every athlete
The unprecedented global Covid-19 pandemic tested people and organizations alike on their commitment to their stated values. The pandemic exposed those organizations and employees whose stated core values were not real, and were just an exercise in polished communications and hollow posturing.
Periods of business uncertainty and stress truly test the trustworthiness and commitment of organizations, and of the people who man the firms, to their core values. The pandemic has provided organizations with a good opportunity to assess their company core values, reflect on, and devise ways in which they can regain any lost trust of their employees and customers.
Harappa, through its ‘Building Presence‘ series of courses, conducts training for individuals and enterprises on the significance of company core values. The course on company core values at Harappa, helps organizations to first understand what are core values, and then be able to identify their specific core values, which are aligned to their unique circumstances and business needs. Harappa’s course on core values is recognized for instilling, in the workforce—strong core values that promote a shared sense of commitment among employees. The shared commitment allows employees to work for a united cause, enhancing organizational effectiveness.
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