Developing a Powerful Vision

When researchers look at successful organizations there is one thing they frequently find in common: a compelling vision of the future and a set of organizational values that underpin this.  In this article the author looks at:

• Why vision and values are helpful for organizations particularly in times of change
• A process for creating a company vision
• How to identify company values

Opinions about articulating vision and values fall into two camps. In some people's eyes expressing a vision and values is played out. They point to examples such as Enron, which publicly extolled lofty values and a high-minded vision, but many knew internally that a corrupt and disreputable style was operating, led from the top.

This is an extreme, but relevant, example. Published vision and values are today everywhere in almost every organization, from churches, schools or hospitals to start-up businesses and multi-nationals. At their best, they give people a sense of inspiration and a benchmark of how to carry out their dealings internally and externally. At their worst, they are hypocritical and irrelevant to how the business operates: visions and values representing ideals which are confined to employee and customer manuals and annual reports. Managers say one thing and do another.

The opposing camp, which is where we sit, asserts that having a well thought-out vision and set of values is a key component of the fast-changing 21st century organization. They cite research that shows that organisations with a clear vision and set of values deliver 29% greater returns. Clearly spelt out vision and values seem to help the organisation run more successfully in a more customer-friendly and profitable way.

All major achievements throughout history are, arguably, attributable to people with powerful dreams about the future. Martin Luther King's "I have a dream" or President Kennedy’s "Man on the moon by the end of the decade" are excellent examples of vision. In fact, the pro-lobby compares the vision to a number of vivid metaphors: a magnetic force that draws people to it and aligns them in the same direction; they refer to vision as the "skyhooks for the soul”; the igniting spark that can inspire and energise people to do better.  To quote Tom Peters, "Developing a vision and living it vigorously are essential elements of leadership"

The difference between effective and ineffective vision and values is clear-cut, and is down to far more than opinion. It lies in the quality of implementation. Those organizations which successfully embed vision and values take their time to work and weave them into the fabric of the organization, to update them to ensure relevance, test them out and gain feedback on performance, and make them a part-and-parcel of the organization.

Based on our personal observations of organizations across a range of sectors, here are some principles to make vision and values mean something more than a set of words on a piece of paper or a sign on the wall.

• Make serious efforts to define what you stand for and what you are about. This goes beyond a senior cabal producing platitudes and involves  talking to customers, employees and suppliers, internally and with other stakeholders.
• Figure out how to make a vision something to which people affected can relate and feel is relevant and meaningful to them. Take the time to involve those people and build in their suggestions.
• If you're serious about vision and values then you need to reinforce the message day-in, day-out. Remember people communicate just by carrying out their daily tasks. For example, if you're placing priority on the fact that customers really count, the issue must be on the agenda at every single meeting.
• Reflect the vision and values externally in cultivating your reputation and brand, making your organization credible and distinctive.
• Embed the vision and values into your performance management system so that employees are encouraged to live the values and are measured against this.
• Ensure communication is two-way. Be prepared to listen to bad news when you do not live up to your values and take action accordingly. Reinforce those occasions when you are successful.
• Vision and values are for the long term, but a vision and practices to support values need to be periodically reviewed and renewed in response to changing circumstances.

Mike Newnham vice president of business solutions at telecommunications company Orange, explains: ‘communicating your vision is critical, whether you are leading a small entrepreneurial company or a large corporate.’

Vision and values in their context

There are a number of terms that get bandied around in relation to vision and values. Often organizations say they have a vision, when in fact this is a ‘mission’.  To help clarify terminology, here is our definition of the different words used:

• Vision : A picture of a desired future state that is sufficiently appealing and compelling to drive change forward : The ‘Where we want to be’
• Mission: The purpose of the organization : The ‘What we want to achieve’
• Values: The underlying principles and ethics that drive the organization : The ‘How we want to act to guide us towards our vision’
• Goals: The objectives or targets that the organization is trying to achieve : The ‘What we need to achieve our mission’
• Strategy: The approach that the organization is adopting to achieve the goals  that support the strategy : The ‘How we will achieve our goals’
• Behaviours: The way in which people in the organization act in terms of what they do and say that brings the strategy and desired culture to life : ‘What we will say and do to bring our values to life’

The ‘corporate diamond’ seen in the figure below explains the inter-relationships.

Figure 1: Corporate diamond

Developing a vision of the future

A vision sits at the pinnacle of the ‘Corporate Diamond’. It sets the direction for the organization, where the business wants to be.  Having a vision for your company means you stretch the organization beyond its current grasp. For example, for many years Bill Gate’s vision for Microsoft was of a computer in every home. Now this is in sight, he has set another stretching vision, to empower people through great software – any time, any place, and on any device.

Powerful visions are compelling and memorable. They endure over time. The Carphone Warehouse, Europe’s leading independent mobile communications retailer, prides itself on offering customers impartial and expert advice, the widest choice of the latest product and unbeatable service. To quote the company literature, “We have always operated on the basic premise that if we provide a good service for our customers, they are more likely to reward us with their loyalty”. Carphone Warehouse’s vision and core values, first introduced by its founder Charles Dunstone, have remained unchanged since its foundation. The company continues to be driven by a dedication to customer satisfaction that has remained unswerving in spite of the many changes the organization has seen.

The criteria for a good vision are that it is memorable, meaningful and inspirational. Here are some examples of organizational visions.  They may not be as meaningful to you because you are not employed by the organization and familiar with the context. However, which do you find memorable?

• Healthcare organization: ‘Taking care of the life in our hands’
• Up market hotel chain: ‘Discovery’
• Entertainment group: ‘Dream, Believe, Dare, Do’
• Financial services organization: ‘To be the first choice for customers and colleagues’
• Card manufacturer and retailer: “To enrich people’s lives, help them express their feelings, celebrate occasions and enhance their relationships”
• Logistics company: ‘People, Customers, Profits’

A vision allows people a focal point during change and gives some context for why the changes are happening. Change itself is a means of helping the organization get to its future state.

Developing a vision

Rather than leaving the vision to the senior team, our recommendation is that all levels of the organization have an opportunity to contribute to this. This creates greater buy-in and a sense of ownership.  This process was recently used successfully with one retailer we worked with in helping them to define their vision – “Making a Difference”.

We ran a series of brainstorm meetings for all levels of the organization, taking a slice of the whole organization. This is important as it gains buy-in from all levels at an early point.  The brainstorming sessions focused on what sort of organization customers, employees and other stakeholders wanted to create for the future. We recorded the outputs, and together with input from the focus groups, participants created a short, inspirational and memorable phrase that captured the essence of the responses.

A short period of testing then followed to validate the vision throughout the organization to ensure that it was relevant to all those involved. It was important that people responsible for testing the proposed vision with their colleagues received feedback on the proposed vision so that it could be amended to reflect everyone’s views.

The next stage was to communicate the vision to all of the organization. Businesses often communicate their vision and values together so that they become more meaningful.  Rather than just presenting the vision and values in written format, it is essential that they are communicated during change in as participative a method as possible. In this way the vision and values come to life and people better understand the need for change in their own terms.

Organizational Values

Values are the guiding principles of the organization. If values are embedded in the organization, they allow all other systems, processes and behaviours to fit together.  An example of this is the people management process.

Figure 2: Vision, values and people management

If you have a clear set of values it can help inform your competencies, which in turn will inform the five key drivers of people development in organizations:

• Recruitment and selection
• Performance management and coaching
• Succession planning and talent management
• Training and development
• Reward and recognition

One organization with whom we worked had a vision of ‘inspiring customers’.  Its values were customer service, teamwork, integrity, and learning.  It developed a competency framework that embedded these four values into the desired skills and behaviours for all levels of employees. The values and competencies in turn drove the recruitment and selection process. They were the criteria against which people were performance managed, promotion decisions were made and development offered. The values were also reinforced through a recognition scheme that gave credit to people who had delivered inspirational service.

Aligning reward to the new culture is equally important. When a change programme was initiated at Defence Aviation Repair Agency, Dara, once part of the MoD, change agents identified that the culture was hierarchical and risk-averse.  It was clear that such a culture would not survive in a commercial environment.  A new reward system, based on broad banding with an upfront pay rise in return for commitment to accepting the new culture replaced the inflexible pay and grading structure that Dara had inherited from the MoD.  This helped to encourage change whilst still retaining employee’s pride in the quality of their work and the importance they paced on the customer.

Having established values and aligned processes, this will make change more manageable and effective as the foundations of the organization are steady as things above it move.

Identifying values

Organizational values show customers, employees and other stakeholders how the business intends to operate on a daily basis. Values are a set of expectations we have of ourselves and others. The values state what it is important for the organization. This solid foundation is essential to keep activities congruent during change.

A recent study carried out by Professor Curtis Verschoor at the University of Chicago and published in Management Accounting found that companies with a defined corporate commitment to ethical principles fare better financially than companies that don’t make ethics a visible management component. Public shaming of Nike’s sweatshop conditions and ‘slave wages’ paid to overseas workers led to a 27% drop in its earnings.

Having created values to underpin change, many organizations fail to make clear to employees how to bring the values to life through their behaviours.

Employees define values

In the same way as setting a vision for the organization, values are best defined by employees. We normally run a series of short workshops and focus groups to begin this process. During the sessions we ask groups of employees, drawn from across the organization, what they consider is and should be important as guiding principles for the organization.  We collect the output and, together with a sponsor and project team, pull together what appear to be the five or six values to which everyone agrees. In practice we find that more than six values risk becoming forgotten.

When developing values it is important to recognise that certain values will be ‘lived’ at present in the organization; others may be ‘espoused’ values – i.e. those that the organizations wishes to embody but which it may not be yet do so. For example, we worked with one financial services organization that developed a value to be ‘human’. It knew from customer research that often this is not how employees were perceived although they wanted the bank to be so. Therefore the organization had to work hard to demonstrate this value in all its transactions with customers.

Values into behaviours

Often values are published in organizations and that alone is expected to change the culture.  Successful organizations bring values to life in everything that happens in the organization.

In order for that to take place, employees need to know how to translate the values into working practices and behaviours, to know what these mean in their everyday working lives.  If people understand how values link to what they do, what values look like in concrete terms, and their positive impact, then they will be more motivated to put the values into practice.

Change heightens uncertainty and makes it difficult for us to be sure how we should behave. However, if guiding principles are in place they set boundaries and offer a measure of certainty to all involved in change.

Best practice is to describe the behaviours that epitomize each value and that are relevant to all employees.  In order to do this, it is best to again involve as many people throughout the organization to generate the behaviours.

We recently worked with a group of 16 people from a service organization to do this. The group of participants represented all levels and functions of employees both at head office and throughout the store network. For each value they brainstormed the behaviours that they individually believed they would demonstrate.

Next, each set of behaviours was prioritized by the group to arrive at between four and six that described each value and which were applicable to everyone.  Each person from the group then took responsibility for gaining feedback from their peer groups about the relevance of the values. Having gained this feedback the values were then introduced via a participative one-day conference of all employees. The values were then reinforced by incorporating them into the performance management system.

One organization we worked with has ‘Enabling’ as one of its values and it defines the Enabling behaviours as:

• Involving others in decision making, encouraging alternative opinions
• Enabling freedom of action through providing clarity on direction, boundaries and scope
• Sharing useful information and experience, helping others to make informed decisions
• Developing others’ performance through providing a mixture of supportive and challenging feedback
• Encouraging others to show personal initiative, taking responsibility, and learning from their mistakes

Are you managing vision & values?

Under each of the headings, make an assessment of your capacity to identify and deliver a relevant vision and values. Note actions to improve important aspects.

Summary

Creating a vision and set of supporting values helps organizations to bring people with them during change.  The best visions are short, memorable and inspirational. Both a vision and values are most meaningful when they are developed by a cross-section of employees who are then much more likely to bring these to life.

To quote Kwan 'jzu (3rd century BC), "When planning for a year, sow corn; when planning for a decade, plant trees; when planning for life, train and educate men".

Sarah Cook is Managing Director of The Stairway Consultancy who specialize in the development of managers and organizations to achieve change in a customer-focused way. She is the author of “Change Management Excellence”, published by Kogan Page, price £16.99. They can be contacted through Sarah Cook at the Stairway Consultancy, on 01628 526535 or email sarah@thestairway.co.uk

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