Developing a Powerful Vision & Values to help bring about Change
When researchers look at successful organisations there is one thing they have in common: a compelling vision of the future and a set of organisational values that underpin this. In this article the authors look 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
Having a clear organisational vision and a set of values benefits the organization, particularly in times of change. A strong vision provides a powerful image of a compelling future state. This can engage and inspire employees. Values are the 'guiding principles' of the organisation. They provide a set of espoused beliefs that help form a frame of reference for the way that employees behave.
Intuit, is the market leader in personal finance software and its employee turnover rate is 13%, half the Silicon Valley average. It attributes a huge part of its success to the employees believing and living the vision and values which they personally were involved in shaping. Intuit's values revolve around 'Doing right by All Our Customers' and they mean all customers - external, internal, business partners and shareholders.
An example of how Intuit's behaviours were driven by their values was highlighted when Scott Cook, the founder of the company found out from the San Francisco Chronicle that a bug had been found in Intuit's TurboTax software programme. When he read this Cook was about to board an aircraft to Los Angeles but trusted his executive team to deal with the issue. True to their belief - 'Doing right by all our customers', the Intuit team took the following action within a 24 hour period:
• Offered to send a new copy of TurboTax to any customer who wanted it - even those who were not registered users
and had only ever 'borrowed' a copy!
• Offered to pay any IRS penalties incurred by customers as a result of the bug
This shows how Intuit, because of their values and beliefs were able to cope with any change in a way that had total integrity.
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.'
There are a number of terms that get banded around in relation to organisational vision and values. Often organisations 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 organisation : The 'What we want to achieve'
• Values: The underlying principles and ethics that drive the organisation : The 'How we want to act to guide us towards our vision'• Goals: The objectives or targets that the organisation is trying to achieve : The 'What we need to achieve our mission'
• Strategy: The approach that the organisation 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 organisation 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'
A vision sits on the pinnacle of the 'Corporate Diamond'. It sets the direction for the organisation, where the business wants to be. Having a vision for your company means you stretch the organisation beyond its current grasp. For example, Bill Gate's vision for Microsoft is of a computer in every home.
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. The company employs 7,500 people in total both in the UK and overseas, working across the stores, the support centres, the call centres, the online teams and the direct sales teams (telesales). Carphone Warehouse's vision and core values, first introduced by its founder Charles Dunstone, have remain 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 organisation 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 meaningful to you because you are not employed by the organisation. However, which do you find memorable and inspirational?
• 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 clleagues'
• 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 explanation for why the changes are happening. Change itself is a means of helping the organization get to its future state.
A process for developing a vision in an organisation
Rather than leaving the vision to be created by 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 at all levels of the organisation e.g. a slice of the organisation. This is important as it gains buy-in from all levels at an early point. The brainstorming sessions focused on what sort of organisation customers, employees and other stakeholders wanted to create for the future. We recorded the outputs and together with 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 test 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 can be amended to reflect everyone's views.
The next stage was to communicate the vision to all of the organization in whatever way was most appropriate to match the organisational culture. 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 method as possible. In this way the vision and values come to life and people better understand the need for change.
Values are the guiding principles of the organization. If values are embedded in the organization, it allows all other systems, processes and behaviours to be aligned in the organization. An example of this is the people management process.
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:
1. Recruitment and selection
2. Performance management and coaching
3. Succession planning and talent
4. Training and development
5. 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 brought to life 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 placed 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.
Organisational values show customers, employees and other stakeholders how that organization 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 things congruent during change.
A recent study done at the University of Chicago by Professor Curtis Verschoor and published in Management Accounting found that companies with a defined corporate commitment to ethical principles do better financially than companies that don't make ethics a key 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 organisations fail to make clear to employees how to bring the values to life through their behaviours.
Just like when defining a vision for the organisation, 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 organisation, what they consider is and should be important as guiding principles for the organisation. 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 any more than six values, the values become forgotten.
When developing values it is important to recognise that certain values will be 'lived' at present in the organisation; others may be espoused values - i.e. those that the organisations wishes to embody but which it may not be yet epitomising. For example, we worked with one financial services organisation 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 organisation had to work hard to demonstrate this value in all its transactions with customers.
Often values are published in organizations, pasted on the walls and that is expected to change the culture. Successful organisations bring values to life in everything that happens in the organization.
In order for that to transpire, employees need to know how to translate the values - what do they actually mean they have to do in our everyday working lives? If people understand the meaning, how it links to what they do, what it looks like, what positive impact it can have on them and their colleagues, then they will be more motivated to put the values into practice.
This need for meaning is heightened during change because it is the crisis that change brings with it that makes it difficult for us to know how to behave. If these guiding principles are in place it forms a security and boundary for 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 organisation to do this. The group participants represented all levels and functions of employees both at Head Office and throughout the store network. They brainstormed for each value the behaviours that they individually believed they would do or say to bring the value to life.
Next each set of behaviours was prioritized by the group to arrive at between four and six values 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 one day conference for all employees. This brought the values to life in an interactive and participative fashion. The values were then reinforced by incorporating them into the performance management system.
Here is an example of how values have been translated into behaviours in one organization so that employees know what is expected of themselves and others. The behaviours guidelines act as a statement of the type of person the organization expects them to be and what they believe in.
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
A vision is a powerful tool in creating a picture of a future state that inspires and motivates individuals to give of their best. Values are the under-pinning principles that guide how employees behave and the choices they make in a business environment. Creating a vision and set of supporting values helps organisations to bring people with them during change. The best visions are short, memorable and inspirational. Both visions and values are most meaningful when they are developed by a cross-section of employees who are then enabled to bring these to life.
Sarah Cook and Steve Macaulay are consultants who specialize in the development of managers and organizations to achieve change in a customer-focused way. Sarah is from from the Stairway Consultancy. Steve Macaulay is at Cranfield School of Management, They are the authors 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
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