Think about how decisions are made in your organisation. Are they made on a whim? In line with the strategic vision? On the basis of fluctuating market trends?
And think about who makes those decisions. Is it just you, as the business owner? You and a select few others? Or are all employees allowed to make decisions because they are trusted to make decisions that are right for the company?
These are good questions to ask yourself when thinking about the importance of corporate values for your organisation.
Decisions based on values
If you operate a values-driven organisation, those values inform how decisions are made, both in the long term and in the short term. They inform the top level strategic decisions that determine the direction the company is going in, how and why. And they also inform the more mundane everyday decisions, made at every level throughout your company. Whoever is making the decisions, they are made in tune with the company’s values, rather than randomly or reactively.
When you are your employees are cognisant of your organisational values, it makes decision making and problem solving a lot easier and quicker. It also leads to greater consistency and strategic focus.
Clarity and purpose
Why’s that? Because values are the bedrock of your organisation, underpinning every aspect of how and why you do business. They are a framework everyone can adhere to. When those values are clearly defined and communicated to all, there is clarity of purpose and message. People can refer to those values and use them as their benchmark.
Values determine company culture and we all know how important company culture is. It’s vital. To use a popular expression, values and culture are a case of ‘how we do business around here’.
Values as your guide
In today’s VUCA world (volatility, uncertainty, complexity and ambiguity), it really helps organisations to stay on track when they have a solid statement of values. Being values-driven enables you to make incisive decisions that will help you move forward and innovate through times of uncertainty and huge change. It helps you to stay true to your purpose, even if your business model has taken a huge knock because of external forces.
Being values-driven doesn’t mean staying rigidly fixed to one course of action, but it does mean making decisions for the right reasons, according to the values your organisation thinks are important.
Take sustainability, for example. Say one of your values as an organisation is sustainability and you are looking to reduce costs by switching to a new supplier. Part of your decision-making process will involve making decisions based on how sustainable the potential supplier is and how you would develop the relationship in a way that aligns with your values. Would this move fit with your sustainability values or are there some grey areas that need to be investigated first?
A really important benefit of being a values-driven organisation is that it empowers employees. They understand the values of the organisation and how they translate to day-to-day operations. This fosters autonomy, enabling them to make the decisions that are best for the company, without having to constantly check in with the senior team or refer every decision upwards for sign off. This frees you, as the business owner, to get on with running the business, because you can trust your team to make value-driven decisions.