Last week I ran a half-day interactive session for high-potentials at NIS, the Siberian National Oil Company in Belgrade, Serbia. They wanted to hear how corporate values can drive culture and result-oriented performance management.

My case studies were three companies and corporate values introductions, with which I was myself involved.

Shell Chemicals went ‘global’ in 1997-2003, when I was one of their Global HR Managers. In addition to reorganization and new processes, the set of values known as the ‘WABs’ was integral to major reorganization after major reorganization and the change in culture and mindset required for a much improved performance.

At Fonterra, New Zealand’s biggest company, an international dairy co-operative owned by 10.000 farmers, the values were introduced based on 200 years of heritage and history, but with a view to future performance. ‘They shape what we do and why we do what we do’. Our ‘moral compass’.

For the last two years in TNK-BP in Russia, we introduced values as a check whether the current culture really supported the business strategy and to correct areas where the culture was a hurdle to achieving a better performance.

Teaching something sometimes means you have to learn even more than the students. So it was instructive to research whether values really drive performance and impact the bottom line (in a positive financial manner!)

Intuitively it makes sense that core values help define corporate culture which drives actions and performance that management believe are required for success. But of course it is difficult to measure. Nevertheless there is both direct and indirect support. Studies have shown that values positively affect the workplace. Staff trust and support management and the people for whom they work, have pride and ownership in what they do, and enjoy working with their colleagues and share knowledge. And similar studies show that companies with great workplaces are more financially successful than their peers. There are also studies showing positive effects on employee loyalty and retention and organizational reputation with customers & shareholders. And in the other direction, companies with imbedded values reduce costs compared to those without.

Of course you can do it without values or culture. But a culture will always develop even if you do nothing. So ‘a wise organization does not leave the evolution if culture to chance’.

As Starbuck’s CEO is quoted: ‘The value of your company is driven by your company’s values’.

There are many best practices and practical ways to drive performance through values. Many companies use values explicitly in performance appraisal of both individuals and businesses. They are built into recruitment & selection. Then they are used throughout onboarding of new staff. Obviously they can be linked to compensation, through performance appraisal, but they can also be used specifically in other recognition & reward schemes. Potential and the identification, selection & development of future leaders is another major area for values application. Feedback can be given in leadership & team meetings about displays of values behaviour. I have even used a full values yearly implementation plan.  Including articles, newsletters and themed events. Storytelling, especially by senior management, is a powerful tool.

It does however require repetition & consistency, discipline & diligence. Core values have to be instilled in everything you do, every day in every way.

And the Number One Reason that core values are not ingrained and fail is that senior leaders do not live up to them.

As one of the course participants said after one of the exercises, it is easier to be cynical about values than a believer. It takes effort!

We finished with work on their own company values and their own responsibility as leaders to work with values and drive performance in their company.

The successful conclusion was that everyone individually & spontaneously said they had learned a fascinating new leadership tool of addressing values with their staff to drive performance and would be putting their learning into practice when they returned to the workplace.

There are lots of examples of company values helping to define the corporate culture which drives actions and performance that management believe are required for success. But it requires the leaders (and future leaders) show how important they believe them to be.

Feel free to contact me for more information.

5 Comments

  1. Stacie

    Pretty! This was a really wonderul post. Thanks forr supplying these details.

    Reply
  2. Tom hardy workout

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  3. Sergei Polianski

    Hi Gary, a very insightful block, and plenty of good advice! – thanks so much for sharing. Greetings from Geneva, Sergei

    Reply
  4. Amy Suhl

    Sounds like it was an interesting workshop – one, I would have liked attending

    Reply
  5. Edna Travers

    Nice blog Gary, thanks for sharing!

    Reply

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