What Are Core Values and Why Do They Matter?
Core Values are more than just words; they are the foundation of your organization and those who work within it. For as important as they are, many companies fail to realize the value in establishing Core Values and inspiring their teams to live by them.
What are Core Values?
Generally speaking, the Core Values of a business are a set of principles or philosophies that guide or shape the organization’s culture and identity. They are meant to reflect the reason a business exists and provide a vision for how to conduct that business.
Most people have their own personal Core Values that guide them through life. Those values might have come from their parents, religion, politics, school––all of which influence a person’s values.
You might think of Core Values as a sort of moral code that helps you make important decisions. This is just as true for a business who wants to establish a core philosophy of how they treat their customers, their clients, their communities, their internal team and even their competitors. Organizations who have good Core Values and use them well, often find that making important and strategic decisions becomes far easier and streamlined. Studies have also shown that “9 of 10 workers would trade money for meaning,” further emphasizing the importance of building a foundation based on Core Values and integrity.
Why do Core Values matter?
An organization’s Core Values are really the heart and soul of the business––it touches every aspect of the organization’s operations.
As the Right Management and Globoforce’s Workforce Mood Tracker study reported in 2012, “65% of workers who could name their values say they had a strong grasp on company objectives versus only 23% of respondents who say they didn’t know any of their company values.”
Perhaps the most obvious impact of core values on an organization is the people who are part of the team. From leadership to janitorial staff, the Core Values help to shape the decisions that are made on a daily basis.
Let’s take a look at an example of a core value you might see in a manufacturing organization.
A common one is ‘Be Environmentally Conscious.’ In other words, to protect the environment by practicing eco-friendly manufacturing practices. If the organization truly lives to this core value, it would impact a whole host of decisions made by the team such as: How should we manufacture this product? Where do we source the components? How should old products be disposed of?
All of these may seem obvious, but if the organization is truly dedicated to their core value of being environmentally conscious, there are additional strategic decisions that will be impacted: how do we power our manufacturing plant? How do we transport the product to market? What sort of cleaning products do we use in our offices and facilities? How much paper do we consume? The list can go on and on.
According to Harvard Business School Professor Emeritus James L. Heskett, “effective culture can account for a full 20-30 percent of the difference in corporate performance between a successful company and its “culturally unremarkable” competitors.”
This is why establishing thoughtful and impactful Core Values are so important. If you intend to live by values as an organization, you also need to consider how they will influence your strategic vision, planning, and decision making.
How do you create Core Values?
There is no magic formula for creating Core Values for your business––just a quick Google search will have your head spinning with 1,000 different ways and methods to come up with them.
One of the biggest mistakes many teams make when creating their Core Values, is to simply copy them from another organization or a competitor or to pick a very successful big company and emulate their core values. Why that seems like a logical way to accomplish your goals––and understandably so––your Core Values need to come from a place of authenticity and passion. They’re your team’s Core Values––not someone else’s.
The best way to approach creating Core Values, is to start with your team itself. Typically, workshopping is one of the best ways to establish your organization’s Core Values because it involves bringing together a cross-functional team who will all have different opinions, objectives, motivations, and moral interests––and, of course, different perspectives from a range of personal and professional experiences.
When core values are right and the team reflects them, it creates synchronization and alignment while reducing conflict. As you define Core Values, think about traits and skills that every team member should exemplify on a daily basis, no matter what situation or decision needs to be made.
There are many ways to do this––organizations with a healthy budget often hire a firm to come in and facilitate several workshops to help establish the Core Values. You can also find do-it-yourself books, PDFs, presentations and even YouTube videos to go at it on your own.
Frictionless can help.
Frictionless was developed specifically to help teams create their Core Values in addition to a whole host of other related strategic components.
The platform guides users through a series of exercises to help identify Core Values that are unique to the organization. It was designed with collaboration in mind, to allow teams to share ideas and opinions so that everyone’s voice is heard. Crucially, Frictionless makes it easy to share what you’ve workshopped with your entire organization so that you can align everyone at the same time.