How to Use Core Values to Drive Decision-Making

How to Use Core Values to Drive Decision-Making

By Martin Dippenaar (CEO)

Some time ago, a friend told me about an executive meeting he attended with the C-suite and some board members of a large global company. As the conversation turned to the official company core values, there was general laughter in the room and the CEO said, ”Oh no, those are not for us! Those are for the people who work for us!”. If you are not horrified by this, the reasons why this damaging will soon become apparent.

Firstly, let’s take a step back and look at why a company should have clearly defined core values:

    1. Core values are an important hiring and retention tool. It is an indicator of the company’s culture, and people will trust in a company that shares many of their personal values.
    2. Your core values create an external identity and clients will know what to expect of you. They build trust in the relationship.
    3. It guides the decision-making process.

Decisions are made daily by all employees in a company; whether a macro-decision about a product or a client, a more subtle micro-decision like the tone of an email or dealing with conflict with another employee. These decisions all influence the success of the business.

You cannot police every decision made in the business, but you can guide your people to make the right decisions with a clearly defined set of core values.

After all, your employees did accept your offer because they believe they share the company’s values.

Macro-decisions and employee retention

Most macro-decisions are made within the management structure, with the most significant decisions usually made on board level or by C-suite level people. These are often strategic and operational and guide the direction of the business. If any of these decisions conflict with the company’s core values, or conflicts with an individual’s or customer’s personal values, trust in the company is broken, and this will result in staff turnover and a loss of clients.

This is why it is essential for companies to define a set of real core values, and to live by those values throughout all levels in the organisation.  We don’t want to spend a lot of time and money to employ the “right” employees and clients, only to have them alienated by decisions that are not in line with the company’s values.

Micro-decisions and your company success

Micro-decisions are made daily by everyone in your organisation. Programmed decisions, i.e. decision that are business-as-usual and have a precedence, are normally easy to explain and to enforce. But what happens when employees need to make decisions that do not occur often and are difficult to make? How do you guide your people in making decisions correctly?

If you ensure that all decisions in the business are made in accordance with your core values, the decisions will overwhelmingly have the appropriate result; and the stress levels placed on your employees when making these decisions will be reduced. If you instil the importance of these values in your people, they will behave according to your core value set, which in turn will enable you to build and maintain a healthy culture for your business.

Lastly, if decisions are based around a set of core values, conflict becomes less personal as the discussion can and should be framed within the context of the core values of the company.

So how do you go about it:

  1. Define your core set of values. They should be real, useful, practical, and accurate values that describe the ethos of your business, enables your identity, and drives your culture. There is a plethora of tools to assist you.
  2. Ensure that everyone in the company knows and understands what these values are. It is important that people know that these are real values that the company lives by, and not lip service to an HR process,
  3. Remind and encourage everyone to always ask the following questions:

If every employee uses these questions to guide them when required to make a decision, it will enable a better, unsupervised decision-making process, and will also reduce the stress that people feel when they have to make decisions, especially difficult ones. Provide this tool to your people and you will find that everyone will be making good decisions naturally, and these will move your company forward.