What are Core Values?
For the past few months, I’ve focused on providing you with useful information about core values and their importance to your organization. I’ve created a visual tool that enables you to easily assess your organization’s core values, reviewed how core values might be used to build and reinforce a culture of trust, and mapped out a four-step framework to use when holding values-centered conversations with your team. Yet there’s a fundamental question that continually pops up for small- to medium-sized organizations looking to delve deeper into this subject: What are core values precisely?
I’ll explain that in this article and also examine the relationship between core values and strategic planning. Let’s begin by briefly exploring the modern history of strategic planning and why the development of core values is often an afterthought for many organizations.
A (Very) Brief History of Strategic Planning & Its Relationship with Core Values
The idea of strategic planning for businesses has been gaining steam for about 100 years, and you’d be hard-pressed to find a leader who doesn’t at least pay lip service to the idea. The development of the Harvard Policy Model in the 1920s, the Ansoff Matrix in the 1950s, and Peter Drucker’s “classic” definition of strategic planning have all pushed the ball forward in significant ways. Yet none of these models, with the possible exception of Drucker’s relationship to Sun Tzu’s The Art of War, even acknowledges core values. (Sun Tzu’s Principle regarding “Character” nods to values as does its relationship with his concept of “The Moral Law.” Still, these concepts are fundamentally distinct from the idea of core values.)
Fast forward to the late 20th and early 21st century, and the conversation has finally begun to change with thought leaders like Jim Collins highlighting the importance of core values. Furthermore, the ongoing discussion regarding stakeholder capitalism is gathering steam (See my article, Why Should I Give a $#&! About Values, Purpose, Culture and All That Other Stuff?) and beginning to heighten awareness about the primacy of core values. Unfortunately, most strategic planning still treats core values as a brief stepping stone or checklist-type item that must be accomplished before tackling the “exciting” mission, vision, and other shiny planning process outcomes and objects.
The movement toward purpose statements and heightened awareness of core values is another positive step forward. However, all too often, the necessary detective work involved to uncover (and codify) an organization’s core values is rushed and compressed. In short, core values are often sacrificed upon the high altar of Strategic Planning and Purpose Statements for three primary reasons:
- Difficulty – The work required to surface core values is hard.
- Time – The time required to surface core values properly is more than many organizations are willing to spend.
- ROI – Many leaders do not understand the long-term value and return on investment that properly developed core values provide.
I’ll write future articles to continue exploring the importance of core values, how their proper development strengthens the strategic planning process, your final plan, and the return on investment that DOES exist. For the moment, though, let’s turn our attention to what core values are and what they are not.
What are (Our) Core Values?
Core values are the fundamental compact by which your organization lives and dies. Phrased another way, core values are a statement of principles that clearly and concisely communicate to ALL stakeholders what your organization believes in and stands for. Core values are:
- Often infused into the DNA of an organization by the owner/founder
- Discoverable through a deliberate process
- An idea that must be reinforced and lived daily
- An operational code that governs internal and external relationships
- Something that is both consistent yet has a slightly different meaning for internal and external stakeholders
- Simultaneously fragile and resilient
These high-minded concepts can be challenging to wrap your head around. A different way of defining good core values is by asking the following questions:
- How do our employees expect us to treat them?
- How do we expect our employees to treat each other?
- How do we expect our employees to treat our external stakeholders?
- What differentiates us from our competitors?
- Upon what foundation are our processes based?
- What matters when we make decisions?
- What do we all agree upon that serves as an operational “code”?
Questions like these will begin to define and make real for you the meaning of “core values.” They will also shed light upon what core values currently exist within your organization— because they are there. Now, let’s tackle the inverse and discuss what core values are not.
What Core Values Are Not
Core values are not the same as statements of mission, vision, purpose, or your organization’s strategy. Core values will inform and influence each of these statements (and your strategic plan), but they are different from those constructs. Core values are not:
- Culture – Your values will undergird and inform culture, but the two are not synonymous.
- Universal – You cannot borrow (or steal) another organization’s core values.
- Imposable – Your organization already has core values—whether you know what they are or not. You cannot arbitrarily decree or impose a set of core values.
- Aspirational – Just as core values cannot be imposed, they cannot be solely aspirational. An organization may work toward a future value (or set of values) if they do so deliberately, but this is a lengthy process that requires time, patience, and a plan.
- Assumed – This is where leadership assumes that everyone knows and understands the organization’s core values despite their lack of codification. (“Understood” is the second level up on the core values pyramid and is essentially the same as “assumed.”)
- Changeable or Compromisable – This often happens when market conditions fluctuate, or an “exception” needs to be made for some reason. If you’re changing or excepting what you think matters, then whatever you’re adjusting is not a core value.
The above list summarizes some of the most common misconceptions (and traps) that organizations fall into regarding core values. Sometimes it’s easier to understand what something is by considering what it is not.
Need Help Identifying and Defining Core Values that Will Strengthen Your Organization?
To recap, core values are most often intertwined with strategic planning. They are frequently misunderstood, misapplied, and not properly surfaced by many organizations. It’s hard work to mine core values, and it’s even more difficult to ensure that your organization lives by them. Yet they can ultimately provide you with the key ingredients for that elusive “secret sauce” that sets you apart. If discovering that recipe appeals to you, give me a call. Let’s cook up some core values up together.