What Are Core Values for a Business?
Core values define what’s important to your business and govern how you conduct it. As part of building your brand, it’s critical to identify and communicate your company’s core values to attract customers and motivate employees.
Core values are what help make up the identity and culture of a business. The values act as standards a business sets regarding how it makes decisions, functions, solves problems and handles customer service. Defining a business’s core values can help round out a business plan, set goals and give the company a unique identity with which employees and customers can relate.
Set of Principles
Core values are not synonymous with a company’s policies and procedures. Written on paper, a business’ core values are a set of words or phrases. These words, however, reflect the principles that guide the company’s interactions with every stakeholder. Stakeholders include those who have money invested in the business, along with employees and customers. Words or phrases used to describe a company’s core values include, “positive change,” “leadership,” “sustainability,” “passion” and “innovation.” Core values establish expected behaviors from those in the organization’s culture that, in turn, will help ensure long-term success. They can also set a business apart when the values are broadly held and deeply embedded within the company.
Foundation of the Business Culture
It is difficult for a business to define matters of importance, how it is to interact with others, set measures, establish goals or effectively make decisions, if core values are not in place. This is because these values form the foundation of the business’ culture, which can help stakeholders feel their opinions are valued and they are in a trusting environment. By establishing core values and consistently applying them, the business culture dictates that all employees in a company share responsibility in the achievement of a goal. Consequently, employees feel valued, have pride in their place of employment and develop a sense of ownership. Departments within a business may have their own set of values, but these set of values must reflect the core values of the company as a whole.
The Means to Achieve a Goal
When a business owner is trying to decide on a set of core values for his company, he can start by asking himself what he is willing to do to achieve his goals. The answer can help develop core values the business owner wishes to share with his employees and other stakeholders. When a business has core values that include acting with integrity and honesty, being persistent, placing service above self, discipline and so on, these values can act as a guide when it comes to making tough decisions. Once a company has a set of core values, it can begin to attract stakeholders who have similar values.
Core values clarify the identity of a business so employees, shareholders, customers and prospective stakeholders can relate to the company. In addition to aiding decision-making, these values can help businesses maintain corporate relationships with professional partners, the media and public.
Corporate Core Values
Companies can have core values as well. These are the guiding principles that help to define how the corporation should behave in business and perhaps beyond, if they have an additional mission to serve the community. Core values are usually expressed in the corporation’s mission statement.
Some examples of core values for a company include:
- A commitment to sustainability and to acting in an environmentally friendly way. Companies like Patagonia and Ben & Jerry’s have environmental sustainability as a core value.
- A commitment to innovation and excellence. Apple Computer is perhaps best known for having a commitment to innovation as a core value. This is embodied by their “Think Different” motto.
- A commitment to doing good for the whole. Google, for example, believes in making a great search engine and building a great company without being evil.
- A commitment to helping those less fortunate. TOMS shoe company gives away a pair of shoes to a needy person for every pair it sells in an effort to alleviate poverty and make life better for others.
- A commitment to building strong communities. Shell oil company donates millions of dollars to the University of Texas to improve student education and to match employee charitable donations.
As you can see, often the core values that companies have are similar to those that individuals might choose as guiding principles as well.
Identifying Core Values
While some people or organizations might expressly share their core values, often the best way to identify these values is to watch how they behave. For example, a tobacco company that emphasizes profits over public health acts in a way that is not consistent with a stated core value of caring for others.
No company will advertise negative core values, of course, but you can judge what really lies at the heart of a business’ mission by examining how they act when it counts. A core value is only true if it has an active influence and if the people or company manage to live by it, at least most of the time.
It’s also important to remember that individuals don’t necessarily choose their core values. Many people have these values instilled in them by the way their parents and the community around them. You may already live by strong core values without realizing it.
To get a sense of what your core values are, ask yourself what activities bring you the most joy, or what you couldn’t live without. What gives your life meaning or what do you want to achieve? If you can articulate those answers, you’ll likely see a pattern that you can boil down into a single concept, such as a consistently positive attitude or using your creativity to make the world a better place.
Clear Strategic Objectives based on Core Values
The most important characteristic for successful corporate governance is a clear business strategy. It’s important for the business to identify a niche for its products or services. In addition, businesses should establish their target audience and the problems they are trying to solve. The business needs to identify a strategic plan base on their core values that will enable it to meet the goals of the target audience with its products or services.