Why you should define organizational values
Values are an integral part of any organization, regardless of whether leaders and workers are aware of them. In one sentence, we can describe organizational values as the minimum standard of acceptable behavior. They represent how individuals and the organization will walk the path toward its purpose and goals, ensuring that everyone is on the same page.
Values are the building blocks of organizational culture, they are the ingredients found in positive workplace relationships and, if implemented well, they improve employee engagement. Clear communication of values can help in attracting the right employees and clients, those who share similar values, and creating emotional connections with them that extend outside solely transactional relationships.
Signals Of A Need To Address Values
When an organization fails to establish organizational values, it can experience a range of challenges, from confusion in decision-making to inconsistency and superficial connections, both internally and externally with employees, clients, and partners. Hiring the right talent becomes a challenge, as leaders often overlook the importance of cultural fit over the respective competencies and skills. High turnover is fueled by employees who see the job only as a job and not as a place with a shared identity, where they can align their values to those of the organization.
Without defined values, an organization can face many different organizational cultures across the whole company, with each department or region portraying its own behaviors and standards. As values stand for the minimal work and collaboration standards in the organization, not having defined and aligned organizational values leads to a fluctuation of borders, of what is accepted and what is not.
The Power of Values in the Workplace
Establishing organizational values is essential for any organization looking to build a strong, cohesive culture. They are directive in terms of “this is how we do things” and, at the same time, offer a common playground for like-minded individuals.
With set values, hiring new employees is easier, as potential new hires will be able to assess whether this is the organization for them and whether the values inspire them to become part of the team. On the organization’s side, people responsible for hiring can review candidates through the lens of values and better assess whether they are compatible with the established organizational culture. They can check whether they will be able to align their personal values with the values of the organization and embody the behaviors connected to each value.
Once established and implemented, values offer a common language through which different situations can be addressed. They offer another lens through which the organization and the employees within it can make collaboration and behavioral decisions that will be in alignment with what the organization stands for.
"If people have compatible values with the organization – and the organization’s culture succeeds in expressing those values – less time and energy will be spent on conflicts; there will be fewer disagreements and frictions. Instead, there will be a greater focus on common goals, cooperation, and other activities."
Values can be a source of personal development and growth for employees. Leaders can increase engagement by introducing various values-based initiatives, from incorporating them into team-building events to introducing value champions and rewarding the most exemplary employees. The emotional connections between employees and customers alike become deeper and more meaningful as they can connect through the shared internal compasses they already possess.
Having an established and integrated set of values allows more people to contribute to building a strong organizational culture which, on some levels, provides a feeling of safety to everyone in the organization, because values also serve as guides on behavior, connection, and communication. This makes the playing field and the rules of the game clear, known, and applicable to everyone.
Values Are a Lever For Employee Engagement
Employee engagement represents the level of voluntary emotional and intellectual involvement in an organization. It directly affects overall enthusiasm at work and the level of commitment to conclude projects.
Non-commitment of employees is known as cultural entropy. It is measured by the energy used on non-essential, non-productive activities such as conflicts, disagreements, frustrations regarding relationships, or established processes. When the level of cultural entropy is high, individuals are focusing on their own needs rather than the needs of others (colleagues, leaders, other employees and clients). Systemic implementation of values can lower levels of entropy.
"Values hold the team together, provide stability for the team to grow upon, measure the team’s performance, give direction and guidance and attract like-minded people."
Who Defines Organizational Values?
Establishing values in an organization is a grand, long-term responsibility. It’s a constantly evolving process that should be approached with care, patience, and stamina. People with the highest expression of these traits are usually found in senior management. That’s why values should be set up by the founders or leaders of the organization, but they can also be created collaboratively with the input of employees.
Regardless of their position, those responsible for setting up the values must have a deep understanding of the organization, its culture, and its goals. They are able to identify the values that will help the team members achieve their objectives, and that align with the organization's purpose.
Values create the baseline so that work can happen. If values don’t sync with employees and the nature of the business, the misalignment disturbs everyone’s creative process. When values sync within the team and throughout the organization, they become almost unnoticeably essential, like the air we breathe.
When setting up the values in a democratic, all-employee survey manner, caution is necessary to avoid selecting values that don’t resonate with the top management. The CEO, owners, and executives must be able to embody the selected values and serve as role models for them. They can only be role models in practice if they truly believe in the organizational values and can align them with their personal values.
Clarifying Different Types of Values
The primary focus of the organizational values is a framework of how we work together (our minimally acceptable standards of behavior). Brand values, on the other hand, describe the unique and differentiating qualities found in product development, client service, or approach to market that makes the brand recognizable. Lastly, customer values focus primarily on customer needs and the benefits they receive from the products or services. All of these types of values can be set up using the same process, with the main focus of each being at the forefront of discussion.
A similar mix-up often occurs between organizational values and “guiding principles”, two different concepts, each with their respective origin, use, and benefit. While values describe the behaviors within an organization, principles represent rules and guideposts. Principles look and sound like statements that are objective and hold for the entire organization, making them a tool that helps diverse individuals and teams approach problems and make decisions consistently and predictably, no matter the situation.
The choice to define organizational values, guiding principles, or both, is up to the needs of the specific organization. However, a key to remember is that unlike principles, which don’t exist by default and aren’t put to practice unless they are defined and enforced, organizational values are always present and actively influence behavior between co-workers, always have been and will be, regardless of whether they are defined or not.
