[caption id="attachment_41" align="alignright" width="168" caption="Values and Principles"][/caption]
“Try not to become a man of success, but rather a man of value.” – Albert Einstein
Recently I had the opportunity to dine with Ken Majer who has been doing outstanding work in the area of values and their effect on companies. He makes a great case that the corporate values should be established before the vision, and mission of a company as misalignment of values will inadvertently cause the strategies to fail during execution.
From a company growth perspective, companies in start-up mode typically involve only a handful of people. It will also be likely that each of these people will hold in common a value set, and be passionate about these values. Everyone in these companies will typically wear many hats and quite often cover for each other. In a small company, if these people did not share the same values they likely could not coexist. Likewise, if they did not share a passion for what they were doing they would likely not be in a start-up.
As companies grow and the number of people involved necessarily become more diverse, it can be reasonably argued that great care needs to be taken as each person added to the team will be a relatively high percentatge of workforce. If this additional person has misaligned values they will represent a misalignment of values in this corresponding percentage of the workforce and lead to a breakdown in execution.
At some point, companies will necessarily create functional groups, (sales, manufacturing, finance, legal, IT, etc) where specialized skills are required – and this is where the question of scalability comes in. As these groups grow it is increasingly difficult to maintain a population with a unified set of corporate values, both from a resource availability standpoint and from a natural diversity in the population of candidates. Stereotypes around functional groups such as sales, IT, and accounting would indicate that the operating values move from the larger organization to the functional group. Said another way, each functional group will either form their own value set or draw their own interpretation of the organization value set.
Leadership clearly has a significant part in this discussion. As the group of people increases, people will find leaders close to them in the organization (not necessarily their managers). The values carried by these leaders will have a profound effect not only on those following them, but on the organization as a whole.
If the assumptions above are true – emergent functional groups adopting their own interpretation of values, and individual leaders driving values for those that follow them, then this would imply that values in their purest form do not scale across an organization, but only to a point where the group does not naturally fragment.
Assuming this is true, the corporate value set becomes complex with multiple layers. At the core layer will be the values held by each individual, the layer above this would be the values held by the functional group, and the outer layer would be values held by the organization as a whole. It would also mean that the further you move from the inner core, the weaker the values become. It also means that the lack of organizational value scalability will impede people getting on “the same page” as the differing value sets will carry different agendas. All other things being equal, the larger the organization the more difficult it will be to share a unified value set and the greater the impediment to progress.
Looking Forward
As the net generation moves into the workforce with their own set of values, placing a high value on individuality, what will this mean in terms of corporate values? Also, this generation does not place a premium on meeting in a face to face manner around a conference table, prefering to spend much more time on-line, possibly with different on-line identities. More and more of their work is done collaboratively in an asynchronous remote manner. Different forms of leadership will emerge in this environment than in its organizational predecessor. Will organizational values in these organizations differ from organizations in the past? Will they scale better as the norm will be to operate in a more scalable manner across geographies with a more limited set of direct personal contact? How should we structure organizations to take advantage of this growing organizational dynamic?
I look forward to hearing your thoughts.
