Values are the guiding principles on which your family business is built. They define your company’s standards, character, and culture, and set the ground rules for the behavior of each and every one of your employees.
Creating and communicating the corevalues of your family business lets you and your employees know what you stand for and how to act or react in any situation. Here is a simple example using two car companies:
- Company A produces exclusive luxury cars priced at $80,000 or more. Their values are Quality and Luxury.
- Company B produces practical cars for the general population that cost less than $30,000 each. Their values are Quality and Affordable.
Both companies task their engineers with designing a stick shift for a new car. Company A’s engineers design a fancy leather stick shift that is elegant and reliable. Company B’s engineers design a stick shift that is easy to use and reliable, but is made from ordinary materials. While each company values quality and reliability, their stick shifts are different because their engineers understand they are also defined by the values of luxury vs. affordability.
If you currently have company values, it is important to clarify how your employees’ actions should align with your values. One simple way to do this is to fill in the blanks in the following statement: “Because (Value) is important to us, we do (Action).”
If you have not yet defined your company’s core values, here are some guidelines for discovering them:
1. Identify your own values and what is most important to you when leading your business.
2. Involve your employees. They are more likely to be invested in your values if they have input into identifying them.
- In his book Traction, Gino Wickman suggests implementing a process where you ask each member of your team to “list three people who, if you could clone them, would lead you to market domination.” Share the names and ask everyone to list the characteristics these people embody and the qualities they exemplify. The result is essentially a list of core values that matter to your employees.
3. Choose 4 to 7 of the values that you and the majority of your employees agree with.
4. Define the derivative practices based on these values that you want to encourage. Here are two examples:
- “My company believes innovation is important, so each department holds a quarterly innovative thinking meeting.”
- “My company believes that innovation is important, so we have a department dedicated to innovation and new product development.”
Core values serve to guide your family business on the path to success. Investing time in developing these principles will ensure that everyone is aligned with a common purpose and lay the foundation for a cohesive and productive team.