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Why Core Values Matter In Business

Jul 12, 2023 | Business and Leadership Skills

Ever wondered what makes successful organisations stand out in the competitive business landscape? It’s their core values business-wise and how they give heart and soul to a company.

These guiding principles shape the culture, drive growth strategies, and set them apart from competitors. When you implement these values, they can profoundly influence every aspect of your business. They can boost employee morale and productivity, simplify decision-making processes, and help build a positive brand perception.

This article is your guide to just how imperative core values are, how to establish and implement them, their impact on business success, and how to communicate them effectively. Let’s explore how you can leverage core values to guide your business towards sustainable growth and profitability.

What are Company Core Values?

Company core values, or organisational values, are the principles that guide all of a company’s actions. They’re the cultural cornerstone of the organisation, reflecting its true values and shaping its culture. These values define the organisation’s beliefs, principles, and the philosophy behind the values.

Often, these values reflect the ethos of the company’s founders. They’re inherent and sacrosanct; they can’t be compromised, either for convenience or short-term economic gain.

Company Core Values vs. Mission, Vision, and Goals

A company’s mission statement indicates what the company actually does, stating the aim and objectives of the company. A vision statement outlines the organisation’s long-term intentions and objectives. It motivates and directs staff members to realise their full potential and work hard to meet the organisation’s goals.

To fulfil its mission and vision, a corporation must define precise, measurable, and time-bound goals.

For example, goals could include obtaining a particular target market share or increasing sales by a specific percentage within a given time frame.

Core values, on the other hand, are the guiding principles that underpin these mission and vision statements, and the goals that stem from them. They guide crucial actions and behaviours, such as how business decisions are made and how successful relationships are formed.

Stock Photo Puzzle Pieces Core Values

Why are Company Values Important?

Company values are critical if you’re looking to create a long-lasting, successful, and motivating place to work. They help explain why a business does what it does and differentiate the brand from competitors.

Core company values give employees purpose and promote cohesion and cooperation among the team. They impact the employee experience you deliver as well as the relationship you develop with your customers, partners, and shareholders.

Your company values make up your business and they help you differentiate your business from the competition. Core values help you clarify the identity of the brand and educate your clients about what the company stands for. They’re extremely important when it comes to talent attraction and retention.

Your marketing and internal communications teams need to have a great understanding of your company values. Your company values should help you support your employees so they can be successful at what they do.

Elements of Company Core Values

Core values need to be integrated into every employee-related process—hiring methods, performance management systems, criteria for promotions and rewards, and even dismissal policies. From the first interview to the last day of work, employees should be constantly reminded that core values form the basis for every decision the company makes.

Core values should be visible every day at your workplace and they should be an integral part of your internal communication strategy. They help you create a purpose, improve team cohesion, and create a sense of commitment in the workplace. With clear company values, you can significantly improve employee communications at your workplace, and help your employees live by those values.

It’s important that you’re willing to employ people of every gender, race, culture, religion, sexual identity, sexuality, ethnicity, age, and/or ability so long as they meet the requirements, experience, and the company culture. Through inclusion, you’re also willing to provide equal opportunities to all your employees based on their experience, not their gender, race, culture, religion, sexual identity, sexuality, ethnicity, age, and/or ability.

All employees of your company will perform as a representative of the company’s brand and therefore will carry out their duties and responsibilities with integrity while taking full ownership. Building trust between employees and clients is a core value. The choice to adopt a transparent communication policy, which in turn can build trust, is a core value.

How to Establish Your Company Core Values

Consult your employees

In the process of defining your company’s core values, it’s crucial to involve a diverse group from various departments and levels within your organisation. Utilising an employee engagement platform like Workvivo can facilitate this process. This tool can reach all levels of your organisation, encouraging discussions about company values and aiding in their integration into the digital culture of your organisation.

The bond your workforce feels to your company’s values and culture significantly influences their engagement and productivity. A significant number of employees are actively seeking new opportunities or keeping an eye on job openings.

Moreover, a substantial percentage view company culture as a critical factor when considering potential employers. Employees who believe their opinions are valued at work are nearly five times more likely to feel motivated to perform their best work.

Stock Photo Core Values Shown By Cubes With Hand

Ask Your Customers

Customer feedback is a vital resource for business development. It provides insights about your customers’ experiences with your company, product, or services. This feedback can identify the areas that are performing well, those that require enhancement, and strategies to increase customer loyalty.

Public perception of a company has been significantly influenced by the company’s response to recent global events such as the COVID-19 pandemic and racial injustice. A large majority of respondents prefer to shop from/support companies that treated their employees well during the pandemic.

Additionally, a significant percentage said they’d boycott or support a brand based on its response to the current protests.

Look Back on Key Events

Reflecting on significant events can aid in defining your company’s core values. Your company’s stance on social justice issues is becoming increasingly important to both employees and consumers. Numerous studies show that companies that uphold their stated values and promote diversity enjoy greater financial success.

Map it Out and Whittle it Down

After gathering input from your employees and customers, and reflecting on significant events, it’s time to map out and refine your core values. Your team should consider the company’s purpose and mission. They should identify beneficial existing behaviours, practices, and attitudes, and brainstorm important values. These values should then be evaluated, defined, and ranked.

The proposed values should be tested against real-life scenarios and decisions within your company. They should then be shared with all employees and stakeholders. Your company’s reputation and sustainability are heavily influenced by its core values. These values not only attract customers and partners but also motivate and retain employees.

This contributes to reduced turnover costs. They guide decision-making for consistency with long-term goals. They foster a cohesive culture, encourage creativity and risk-taking, and build trust among customers, employees, and stakeholders.

Remember, a value-driven company is more likely to achieve sustainable growth and profitability. This is achieved through customer loyalty, employee commitment, and positive brand perception.

How to Implement Core Values

The journey of instilling core values within your business is an ongoing process. It involves understanding the various types of values, being genuine, taking responsibility, and incorporating them into every process involving your employees.

Check-in with Your Team

The initial step in this journey is to engage with your team. As a leader, your actions are a reflection of your values. These values should be a fundamental part of your decision-making process and should also influence the way you convey those decisions.

Utilise regular staff meetings and chat channels to understand team members’ experiences and beliefs. Make sure your core values statements are prominently displayed within your organisation. Consider creating a playbook for each of your core values, showcasing examples of that value in action.

Solicit Feedback

Feedback is vital for any organisation aiming to improve its performance, customer satisfaction, and innovation. There are various methods to solicit feedback, such as surveys, interviews, focus groups, reviews, ratings, testimonials, or social media, depending on your audience, purpose, and budget.

Implement Feedback

Once you’ve gathered your feedback, it’s time to analyse and prioritise it. The final step is to communicate and act on your feedback. Share your findings and recommendations with your customers, stakeholders, and team members. Always remember to express gratitude for their feedback and show them how much you value and use it. Then, promptly and effectively put your feedback into action.

Make Your Core Values Unique to Your Brand

Your core values should be distinctive to your brand and accurately mirror your mission, vision, beliefs, and objectives. They should guide how employees should act and behave in their daily work. As your business evolves, regularly seek feedback from employees and other stakeholders. Re-evaluate your core values when necessary.

Your company values should provide employees with a clear idea of what to expect and effectively communicate what’s important to the organisation. Keep them concise, making them easier to remember, and more likely to be internalised and adopted as part of your company culture.

Having succinct and memorable values can help create a distinctive brand identity, giving your company a competitive edge.

Stock Photo Showing Core Values As A Game Piece

The Impact of Core Values on Business Success

Enhance Performance

Core values are more than just words on a mission statement; they shape your company’s culture and business strategy.

When employees resonate with these values, they’re more likely to remain loyal, even in challenging times. This alignment not only elevates morale but also boosts productivity and maintains team unity. Studies indicate that a significant number of employees believe that company culture significantly influences productivity, creativity, profitability, firm value, and growth rates.

Streamline Decision-Making

Consider your core values as a navigational tool for business decisions. They ensure your business trajectory aligns with your long-term objectives. Adherence to your core values demonstrates integrity, simplifying decision-making processes.

These values can foster a unified culture, promoting better collaboration and teamwork. They also stimulate creativity and risk-taking, potentially leading to the development of innovative products and services.

Secure a Competitive Advantage

Your core values can provide a competitive advantage, setting you apart from your competitors. They can also enhance the customer experience and foster customer loyalty. Companies with robust cultures and clear business objectives are often perceived as the blueprint for business success.

Employees are more likely to decline job offers or leave their jobs if they perceive the company culture as incompatible. Conversely, employees who feel their voices are heard at work are more likely to feel motivated to excel in their roles.

Enhance Your Reputation

Your core values extend beyond your employees; they also resonate with your external stakeholders. Companies with strong values contribute to society by supporting social and environmental causes, which can bolster their reputation.

Your company’s efforts in Corporate Social Responsibility (CSR) can significantly influence your reputation. Consumers tend to favour sustainable goods and companies that treat their employees well, particularly during crises like the COVID-19 pandemic.

To show you some examples, think of companies like Google, Apple, Patagonia, and Unilever. They all have specific core values that guide their operations. Google emphasises respect for the user, the opportunity, and each other.

Apple focuses on accessibility, education, environment, inclusion and diversity, privacy, and supplier responsibility.

Patagonia is committed to building the best product, causing no unnecessary harm, using business to protect nature, and not being bound by convention.

Unilever prioritises integrity, respect, responsibility, pioneering, and positive societal impact.

These companies have built their reputation on their core values, demonstrating the power of living by your stated corporate values.

Stock Photo Showing 5 Star Company Rating

Communicating Your Company’s Core Values

The Importance of Expressing Core Values

The essence of your organisation lies in its core values. They are the guiding light that influences your company culture and drives productivity and growth. Companies like Adidas and Coca-Cola have unique sets of core values that govern their actions.

To ensure these values are deeply ingrained in your company culture, they should be a regular topic of discussion in staff meetings or regular meetings. They should be evident in daily interactions, job descriptions, interviewing processes, training, and company messaging, materials, and software.

Onboarding and Core Values

During the onboarding process, aligning new hires with your core values is crucial. New employees should have the opportunity to interact with executives who can share the stories behind your company’s beliefs. They should also meet with the organisation’s leaders, C-suite, and founders. An assigned trainer and a buddy can help in integrating the company’s culture into their interactions.

Integrating Core Values into Daily Operations

Your company’s core values should be easily accessible and understandable. They should be brief and clear for effective display. They should guide the behaviour of everyone in the organisation. Consistent communication is key.

As a leader, your actions are a powerful way to communicate your values. Highlighting specific and positive examples of employees demonstrating core values can have a significant impact.

Employer Branding and Core Values

Your employer brand is your image to future and current employees. In a competitive labour market, top passive candidates are bombarded daily with messages from recruiters. Investing in your employer brand could help retain your top talent and lower your cost per hire.

Your core values should be front and centre.

The more places where employees can see or hear the company’s values, the better. This could be on your corporate website, through an employee recognition program, or through a microsite that shares one principle a week over six weeks with new hires.

Your values should foster teamwork, help employees collaborate, communicate principles to clients and customers, hire employees with the right attitude, align the team, and boost motivation.

Companies with clear, meaningful values develop a positive reputation in their industry, which can help improve retention and attract top talent.

Company Showing Core Values With Puzzle Pieces

Embedding Business Core Values for Lasting Success

In essence, core values are the lifeblood of a business. They influence company culture, guide decision-making, enhance performance, streamline operations, and leave a lasting positive impact on both employees and stakeholders.

As such, it is paramount for businesses to not only define their core values, but to weave these principles into the very fabric of their organisational operations, both internally and externally.

Integrating core values into daily operations, with a genuine commitment, rather than just displaying them on a mission statement or website, can lead to measurable success. It ensures that actions taken by the company remain consistent with the principles it espouses, leading to a healthy, credible, and sustainable work culture.

To ensure core values are perpetuated, it’s important to continually engage with your teams, encourage feedback, and foster a work environment that resonates with these values. Whether it is decision-making, customer service, talent attraction and retention, or reputation management, core values provide a navigational compass that can steer any company towards success.

Ultimately, there is no one-size-fits-all approach to defining and embedding core values. Each organisation should diligently identify its own set of principles that align with its mission and vision. But with persistence, authenticity, and intention, a company can effectively establish and live by a core set of values that will differentiate it from its competitors, foster a loyal workforce, and resonate with customers, ultimately driving long-term success.

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