Every so often a business book comes along with the potential to make a profound difference in the business world. Peters and Waterman introduced the concept of an organization’s shared values in their bestseller “In Search of Excellence” in 1982. In 1994, Collins and Porras in “Built to Last” furthered the discussion of the importance of core purpose and values to company success. Now professors R. Edward Freeman and Ellen R. Auster more deeply mine the idea behind, purpose of and value inherent in corporate values as they explain not just what and why, but also how to in their new book, “Bridging the Values Gap: How Authentic Organizations Bring Values to Life”.
In full disclosure, I studied business ethics under Professor Freeman over twenty years ago in graduate school, where he was well recognized as the ‘father of stakeholder theory’, a concept that has now become well recognized in business management. So, I find it a smart part of my own professional development to pick up any book Ed Freeman puts out.
This book is essential reading for any executive in a company with articulated corporate values (or thinking of articulating them) that they hope will make a difference for the business. This book makes a strong case for the value of corporate values—if done the right way. (Here’s a hint: it involves more than simply espousing them.)
Let’s face it, every company already has a set of values, whether the executives have formally articulated them or not. These values may not even be the ones posted on the boardroom wall. So, do these values help or hurt the company? If they’re helpful, could they play a more profound role in the company’s success? Can management learn how to harness the power of corporate values to the company’s benefit? Or will unmanaged values push a company along haphazardly as leadership is left to wonder why it cannot better steer its business?
I have worked in and consulted with many companies – the overwhelming majority of which do not get their values right. They may articulate an inspirational values statement. They may broadly communicate their values to employees. Some companies even assess employee performance according to the values. But these companies have not found the key to truly living their values in a way that brings them to life – and that makes a profound difference to the company’s success.
Now Freeman and Auster have discovered a route to real success with corporate values, the kind that only comes from really probing those companies that have done it right.
In “Bridging the Values Gap”, Freeman and Auster delve into the concept of ‘authenticity’ in business and the central role it holds in articulating corporate values and managing the organization through them. They then probe four types of corporate values: introspective, historical, connectedness and aspirational and how a company’s exploration of these concepts through conversations can effectively elicit a stronger, more directed, more engaged and more aligned corporate culture.
In “Bridging the Values Gap”, Freeman and Auster also address:
- The critical importance of corporate values to business value and success.
- The distinction between stated values and living values.
- What executives get wrong about corporate values, and how to get it right.
- Plenty of stories of companies getting it right and the value that comes from these efforts.
- The numerous traps and pitfalls when undertaking a values initiative and how to avoid them.
As a business leader and consultant, this book has profound implications for how I will think about business performance and success and the levers that affect them. It offers a thorough look into a dimension of corporate strategy and operations, culture and performance that few have explored with any significance.
It is important to know that in this book Freeman and Auster do not offer a quick, easy solution for improving the next quarter’s financial results. Rather, they present a thoughtful approach for how to strengthen significance and coordination in business and, in doing so, ratchet up employee understanding, passion and engagement. This helps to ensure that employees are more inspired, educated and directed in performing for the company as they never have before. This book is a recipe for meaningful, lasting performance—as long as, the authors point out, the effort remains a continuous process.
What I found as the real insight from this book is that the vast majority of companies hardly understand the real strength that well-lived values can contribute to a company’s success. Most companies suffer under the delusion that their values offer clever marketing and branding. They don’t understand the significant strategic, operational and cultural value that such values can provide.
If your company continues to wrestle with how to really extract value from its corporate values efforts, this book is the insight you’ve been looking for.
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