Today, multinationals and SMEs alike publically showcase their corporate values in the hope that the words alone will differentiate their brand from their competitors. However, while no one is disputing the hard work that goes into crafting these statements, they are absolutely worthless unless they are lived and embodied by your team.
As the practice of developing corporate values has become more commonplace, it seems that the reasons behind the process can be forgotten. Organisational values should not be purely aspirational or a marketing stunt; they must be truly authentic to really count. It is crucial that they are reflected throughout the organisation and overlap the behaviours of employees, or trust and integrity can quickly be lost.
In terms of employer brand and talent attraction, a candidate who begins work in an organisation only to find that the employee value proposition they were sold during the recruitment process was a fallacy will quickly move on to pastures new. Conversely, if you hire based on authentic values, then those values become ever more deeply ingrained in the fabric of the organisation’s culture. If you want your company to be innovative, you’ll need a team that thinks outside the box. The best way to hire (and retain!) these creative minds is to have an office already filled with people who share the same values.Organisational values are intrinsically liked with staff engagement. Employee engagement expert David MacLeod OBE, who recently spoke at a Global Accounting Network Thought Leadership Event, promotes the fact that employers need to create the right environment to enable engagement to flourish in the workforce and find the techniques that speak directly to their employees.
This is only possible if a company’s advertised values are truly reflective of its culture. When trust is eroded, the widening gap between values and behaviours can quickly be filled with distrust and demotivation.
When you consider that employee engagement improves productivity and profitability, this is a chance that firms cannot afford to risk. A research paper, Does the stock market full value intangibles? Employee satisfaction and equity prices, conducted by Alex Edmans, Professor of Finance at London Business School, found that over a 25 year period, shareholder returns increased by two to three per cent per year in organisations that were considered great places to work.Similarly, in Nailing the Evidence, a study by the Employee Engagement Taskforce led by Bruce Rayton at the University Of Bath School Of Management, it is noted that increasing employee engagement can lead to 2% higher profitability and 8% productivity.
When corporate values fall flat, as Patrick M. Lencioni notes in his Harvard Business Review article on the topic, they ‘create cynical and dispirited employees, alienate customers, and undermine managerial credibility’. However, when managed correctly, strong corporate values can not only be the key to attracting and retaining top talent, but also ultimately impact the bottom line.
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