While money and perks provide motivation, values provide meaning.

Higher corporate purpose and core values may sound too far ‘out there,’ but the benefits are clear — improved staff motivation and engagement, with a 10-fold performance improvement for those companies with a higher purpose. Consumers are willing to pay more for products and services from companies with a positive influence. In essence — target your values, don’t value your targets.

On my leadership journey in the private, public and nonprofit sectors, the differentiator between thriving or merely surviving has been the ability to identify, operationalize and measure values. Values create a sense of employee engagement, belonging and psychological safety, where people at all levels can become creative leaders and the speed of trust ensures innovation and success.

Employee engagement is a key indicator of a successfully sustainable organization. Yet shockingly, over three decades in 150 countries, Gallup research has shown that employee engagement averages 15%, with 18% actually sabotaging their own organization!

What are values?

Values are more than broad principles like ‘customer focused.’ Values are not concepts, but specific human behaviors. In my experience, a value is not a value unless it has nine key elements.

  1. It must be chosen.
  2. There must be alternatives.
  3. You must know the consequences of your choice.
  4. Once chosen, you prize and cherish it.
  5. You are willing to publicly proclaim it.
  6. You act on it consistently and repeatedly.
  7. You act when this value is broken.
  8. You act to deal with any dilution or disregard to it.
  9. You constantly measure it.

“Organizations need to operationalize their values in terms of expected observable behavior. The ability and willingness to show up behaviorally in alignment with those values is measured no different from your performance outcomes.”   Brene Brown

There are three important steps to being a truly values-based organization.

  1. Wholly Owned

For values to be embedded, they should be created and owned by the whole organization. Their measurement MUST be as important as the business indices. What gets measured gets managed. If you only continually measure money — your morals will be lost. Organizations that fail to involve employees in the creation of their values will fail. Employee engagement from the outset enables behaviors to be understood and measured, peer-to-peer and not hierarchically to dispense with power and control. It needs to be the team that controls the team. Ownership will enable organizationally aligned values that will be the key differentiator to improve employee engagement and business performance. It’s your organizational DNA.

  1. Constant Measurement

Values should be operationalized into behaviors and used to measure the behaviors of all colleagues, by their peers, starting with the CEO. They should be so intrinsically fundamental to the organization that they are used to advertise, interview, appoint, promote, reward, celebrate and continually enhance staff engagement. This is the character (EQ) versus competence (IQ) differential (see table below).

If you are not regularly measuring your values you simply don’t have organizational values. They should be your organization’s universal fingerprint, no matter where you are in the organization. Without this organizational DNA, you cannot ‘thrive,’ never mind simply survive and work here.

“We ended up ditching 70% of the frustrating and time-consuming rules. Those joining must sit the core values test. CVs do not matter; personalities do.” Anja Van der Horst – Hollands Kroon municipality

  1. Exemplified

Leaders must exemplify the values. Organizations fail when they don’t lead with their values. Values should drive an organization’s mission and vision. How can an organization create its mission and vision, if the leaders are not clear about who they are and what their values are? As co-founder of The Walt Disney Company, Roy Disney once said, “It’s not hard to make decisions when you know what your values are.”

Spotify’s motto is, “Hire for culture and train for skills.” The human resources director at Spotify, Katarina Berg, says, “First, we did it the other way around. That made it difficult to not hire someone who had excellent skills but did not match our core values. So, now we do the cultural interview first. This little change really helped strengthen us.”

The ‘leader’ must always be the custodian and exemplar of the values. If they deviate, everyone else will do what is easiest for them — at the cost to the organization. Remember Enron, Parmalat, Lehman Brothers and Worldcom?

Organizational values

The difference between a values-based organization and one where the values are covert (words on a wall) can be summed up below.

When I became chairman of the COVEY Befriending charity in 2009, the first thing we did with the board and all staff was create our values, operationalize the behaviors and then agree to annually appraise on the chosen behaviors for each of the five values. This values based appraisal (VBA) was on a five-point scale for each behavior in each value:

  • 1-never
  • 2-seldom
  • 3-often
  • 4-regularly
  • 5-always

It was scored by everyone who worked closely with each employee, crucially with a comment explaining the rationale for the score to provide constructive feedback and real ownership for giving that score. It was challenging moving from anonymous scores and no comments, but this was crucial to enable discussion, learning and development by leaning into the honest discomfort. Since then, we have quadrupled our staff, tripled our funders and now have five times the funds to help disadvantaged young people. You can view COVEY’s values booklet here.

“I can work with someone who needs more coaching or training, but when it comes to core values, I have to be intolerant.” — Jean Kovacs, CEO Comergent Technologies, Inc.

In today’s instantly changing, internet, COVID-19 world, where more and more people are working remotely, with less and less control, values and emancipated employees will mean the difference between thriving and simply surviving.

Learn more about Morgan and how to connect at www.qfour.net.