I talked in a recent post about the need for management to lead by example, to live organisational values. This has since led me to consider how values come to exist in the first place. How do you define and embed meaningful values that are lived by leadership, engage employees and, ultimately, drive business performance?

Values should be a reflection of what a company stands for. How its people should conduct themselves and what image they are projecting. Values drive the behaviour of both leadership and employees. So it is important that they reflect the underlying attitudes of employees.

Defining organisational values should be an organic process – they must fit the organisation. If they aren’t a true reflection of the culture and how the company works, it inevitably becomes a tick box exercise. It will be meaningless for employees and for the organisation. This is why consultation with employee groups is needed before setting and embedding values.

Companies often have different reasons for introducing organisational values. Some choose to do it when they are starting out to establish their identity, some when they grow significantly in order to ensure consistency and understanding across the business and others to respond to their competitors or clients.

Whatever the drivers though, there are two critical components to the success of values. The first is leadership buy-in and sponsorship. The second is having values aligned with business strategy that employees fully understand and believe in.

The reward is simple: Companies with an established value base that is lived by leadership and employees alike achieve a strong employee value proposition, increased levels of engagement and, ultimately, increased business performance.  

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