The importance of defining core values for your business
“It is not until you change your identity to match your life blueprint that you will understand why everything in the past never worked.” ― Shannon L. Alder
Our life blueprint is defined by our core values. They define who we are and serve as an internal lighthouse and make sure we are on the right path with respect to the actions we take, decisions we make, and the people we surround ourselves with. Without these core values, we are left to stray.
The same holds true for your business. Without a set of core values to act as your compass, there is no direction and your business is left to stray.
Why you need to define your core values first
The process in building a truly great company starts with vision. While the typical entrepreneur can clearly “see” this vision, in order to drive your company forward it has to get out of their heads, written down, and shared with everybody in the organization so that they can get on the same page and determine if they want to take this journey with you. Patrick Lencioni, in The Five Dysfunctions of a Team, credits a friend who built a billion-dollar company with stating “If you could get all the people in an organization rowing in the same direction, you could dominate any industry, in any market, against any competition, at any time.”
The very first step in clarifying your vision is to answer the question “What are your core values?” You should have a short list, ideally between three and seven, that define your culture. These should not be “reach” goals, but rather the values exhibited by each of your top employees. As Jim Collins and Jerry Porras write in Built to Last, “You do not ‘create’ or ‘set’ your core ideology. You discover your core ideology”.
Core values should be specific and be exhibited by all of your top players. They are guiding principles, and can be as simple as a single word or a short phrase. Here are just a few examples:
Passion: Passion is at the heart of our company. We are continuously moving forward, innovating, and improving (Adidas)
Collaboration: Leverage collective genius (Coca-Cola)
Focus on impact (Facebook)
Humbleness and willpower (Ikea)
It is our nature to innovate (Nike)
Fanatical Support in all we do (Rackspace)
What are the benefits of having core values?
They define your company culture. Core values will set the tone as to who you are as people and how you act on a regular basis towards each other, your customers, and your vendors. They provide a solid foundation to your company.
They attract the right people to your organization. You will find that it is easier to recognize potential employees that fit your culture. This is helpful in recruiting the right people or even determining the success of a potential merger or acquisition.
They will help you weed out people who don’t fit. Those who don’t fit your clearly defined values will stand out like a sore thumb. Whether you help them exit the company or they leave on their own, it will give you the chance to replace them with the right person.
They set the framework for how you hire, fire, reward, and recognize your team. There is a much clearer expectation of what is required of your employees and a measurable standard in place to evaluate them.