Values 2.0 Now

Lemhi Dawn 12 9-16-04

Introduction

The following is an updated and revised version of a set of five posts from the spring of 2008 on the topic of Values 2.0. After reading them during my 10th anniversary of blogging, I decided that they needed to be brought together into one longer, more coherent, less fragmented post.

The above photo is symbolic of the values that I write about below. It is taken at the Lemhi Pass along the Lewis & Clark Heritage Trail on the Montana - Idaho border. A place of great meaning to the followers of the story, as well as to me.

The Value of Values

Several years ago, I was involved with a project where values were the focus of the revitalization of the company. In this project, a cross-section of the company developed a values statement that they believed, and I concurred, were representative of the values of the company's people. Their values statement was warmly and enthusiastically received by the company. The efforts of the company's leadership to inform and deploy their values throughout the company earned them recognition beyond their industry as a trustworthy company.

Having gone through this experience, I became convinced that values are a social mechanism for the purpose of uniting people around shared ideas or beliefs.

Whether the idea is integrity or creativity, the idea provides meaning and purpose for people. When that idea is shared with others who also value it, a social context for their relationships is formed that enables them to work through obstacles and achieve higher levels of impact that thought possible otherwise.

The values culture of a business is integral to the healthy functioning of human relationships within an organizational context.  Too many organizations ignore this facet of leadership. They treat values as an ancillary exercise that is elective and marginal in impact. 

Values: Museum Artifact or Living History

Values are ideas that identify what is important to us. In an organizational context, these ideas are intended to project a certain image about the company. Whether the value is being "dependable" or "fun" the effect is to make a statement that describes what the company believes in or stands for. This is the traditional approach to values. They are iconic statements of identity. 

For many people and organizations, this approach treats values as an historical artifact.

You go to a museum, and in the main hall there is a life-size model of a Tyrannosaurus Rex. You walk into a room called The Hall of Values, the first thing you see is a frame with a magazine ad for "ACME Dynamite Company - Dependable Explosions since 1904."  Then there is a statue of a man in a business suit and a sign that simply says "Trust."  At the rear of the hall, there is a display of an auto assembly line from the 1950's with a sign that says, "Innovation."

We see concepts applied to business as a way of distinguishing them from their competitors. We call this branding or marketing, of course. But we treat values in much the same way. They are like museum artifacts.

There is an ancient, historical character to words like "trust", "dependable", or "integrity." They are words that signify a specific meaning.  These words are recollections of a past time. They carrying with their historical meaning, fixed images of the company that are intended to remain as the values impression of the company.

We know when there is a breakdown between the espoused values and reality, when a company sells itself as trustworthy, dependable and operating with the highest integrity, and in the morning newspaper we read of the embezzlement of millions of dollars by a top official. We know that the "espoused values" no longer command attention like they did in the past. This disconnect leads people to believe that the value words are hollow. Have enough of this occurrences, and people believe that this isn't one person or one company but a society-wide or industry-wide culture of corruption. 

It may well be true that 99% of the company's employees are trustworthy, dependable and have integrity.  The moral failures of a few are thrust upon the many whom remain behind to pick up the pieces of a tattered reputation. Values reduced to ad copy or a relic in the company museum set up the conditions for failure.

This traditional approach to values treats values as museum pieces. Leaders are curators of those values. We parade the values out for celebrations, then return them to their rightful place in a glassed trophy case in the lobby. I'm not blaming marketers for this situation. In fact, they may be the only ones who come close to understanding the importance of values that represent the company.

How we utilize values in the future must be very different than in the past. Instead of values being museum artifacts, they need to be living history experiences that take on a life of their own.

Values that are fully realized are not static museum displays, but about the living experiences of the company. If they are historic values of the company, recreating the experiences that led to particular values becoming the company's values may be needed.

For example, I have heard people say that their company used to be like a family. They would say things like:

"We cared for each other like family. We knew each other's spouses and kids. We got together to play softball in the spring and attend company picnics in the summer."

If being a family is a value that is a part of the company's DNA, then create opportunities to be a family. Set up committees to raise money to help "family" members in need. Just don't talk about the glory days of the past when you were like a family. Be a family now.

If values matter, then they will mean more by being intentionally applied to the relationships and processes of the company. The ideal is simple. The application is not so simple.  It requires work to integrate values into the work of a company. Yet that is what Values 2.0 is about.   

The Difference between Values and Value-added

Is there a difference between values and value added?  What is this difference?

Value is a measurement of appreciation, impact or benefit.

For example, I hear often the phrase "value added" which means that the client is receiving more than what they expected. There is a higher level of impact or benefit.  Value can be defined as a Return-On-Investment (ROI) figure. Or it can be something less quantitative, more qualitative.  In those instances, the measure is based on a particular perception of an idea, like a car or a suit being valued as a luxury item.

Values are ideas that define meaning or value.

Typically we'd see values as those ideas that point to a purpose or a standard.  Values unify when shared between people or in organizations, and divide when not. Values create culture. Values guide culture, build trust in relationships, and strengthen a group of people to do the unimaginable.

For example, you are sitting in a meeting and everyone is texting on their phones, not paying attention to the presenter. This typical experience may be widely accepted, but it is also rude. The judgment that the behavior is rude is based on values that govern the social relationships of people. Typically we call this set of values, etiquette.  These values are ideas about what is appropriate behavior in a meeting or other social context. The values of respect and courtesy demand some sort of accommodation to the ever present smart phone.

Values are the ideological foundation of human interaction. They are the fundamental beliefs that create a culture, and as we all know every organization is run by a prescribed culture. Groups that work and those that are ineffective are both so because of various values that are functioning. Those values are either shared ones or at odds with the purpose of the meeting or group. More importantly, their share values are either not acknowledged or not acted upon by the group or organization create ambivalence and indifference in the participants.

Ask any person who works in a large corporate culture, and they can describe values that govern how they work together. 

If you want to provide value-added products and services, ask yourself, "What values am I utilizing to increase my value-added impact?"

Values 2.0, the Interaction Paradigm
We are entering a new era regarding organizational values. It is an analogous to the change that Neville Hobson describes in this video from 2007. He says that the web has shifted. It used to be that websites were "read only ... (and now, we're) seeing a shift to read - write. You can read and write." This is happening through the use of social media. A similar shift is taking place on the values front.

For illustration purposes, let's describe the old way of using values as Values 1.0, and this new approach that I'm advocating as Values 2.0.

Values 1.0 are values that are used as boilerplate ideas to serve some abstract function. They represent an idea that is meant to be read without interaction. These words become iconic as representations of the company.

For example, for as long as I can remember, Coca Cola has been referred to as "The Real Thing." This values statement is an iconic label for the soft drink. Is the value of authenticity simply a marketing slogan, or is this representative of the company itself? I don't, and my purpose here is only to show how a value concept can be used in a non-interactive manner.

This was been the basic approach to communication by companies throughout the 20th century. In essence, their communication strategy is the distribution of information to the public.

Values 2.0 are the ideas that give people a reason to engage, interact and unite around a share purpose of who they are and what their organization stands for. Today, this is now the default approach to communication. Interaction with the customer is the key to building a successful brand. It is also the key to changing the internal communication environment of organizations.

These two approaches can be distinguished in this way.

Values 1.0 - Ideas - Icon - Irrelevance

Values 2.0 - Ideas - Interaction - Integration - Impact

Placed in the context of the Circle of Impact, values serve an important role, just as do a clear purpose, a compelling vision and a healthy organizational structure.

Values 2-0-Interaction
Values matter at the most basic point of human interaction, and increasingly in a business climate that requires greater people interaction skills to meet complex demands.  Values are the super-glue that unite people together for the work they must do.

The heart of Values 2.0 is human interaction for action. We are not talking about lovely sentimental ideas that are printed on posters and hung on office walls. We are talking about the ideas of substance that support and guide people in their interactions.

Creating a Culture for Interaction

When The Cluetrain Manifesto came out in 1999, it represented a transition that would come to mark the first decade of the 21st Century. The shift is captured in the first Cluetrain thesis - Markets are conversations.

Cluetrain introduced the idea of human interaction into the discussion about marketing and business, predicting the rise of the social media phenomenon. The book seems a bit obvious now, but a decade and a half ago their book was revolutionary in what it proposed.

Two decades ago, Jim Collins and Jerry Porras' published Built To Last: Successful Habits of Visionary Companies. One of the first books that took seriously the place of values in organizations.

I find myself returning to both books time and again because of their treatment of values in organizations. They were both instrumental, at the time that I first read them, in my own developing thoughts about leadership and organizations.

In Built to Last, Collins and Porras make an insightful distinction between values and cultural practices. The difference is simple.

Core Values provide a social foundation for groups of people and organizations to change while preserving the integrity of the organization.

Cultural Practices are those practices that have lost their reason for being, yet still command allegiance as the historic traditions of the organization. These are situations where you might hear in a meeting, "Well, we've never done it that way."

According to Collins and Porras, companies that are successful over time, are so because they are true to their core values. The distinction matters because leaders of organizations must push change at the cultural practices level in order to preserve their core values.

Collins & Porras Diagram

Values, whether acknowledged or not, are important to a business. A basic question we must ask is: "How are values important to us?"

When Built To Last was written, the approach to values in business was primarily ethical and utilitarian, asking, "What are the boundaries of what is legal and will not embarrass us?" This approach was inadequate then, and remains so today. The complexity of organizational life has grown, even as web-based transparency has grown, it is much easier to hide the unethical and illegal, and let ethics be a function of public relations.

Without genuine, authentic transparency, companies are really not in conversation with their constituents. The effect of not recognizing the role of values in organizations, like transparency, a business today can lack real awareness and perception of how it is doing.

Today, a business that is not addressing the Interaction Paradigm is behind the developmental curve. Clay Shirky, a smart observer of the cultural implications of the development of social media, says,

... Media in the 20th century was run as a single race--consumption.  How much can we produce?  How much can you consume?  Can we produce more and you'll consume more?  And the answer to that question has generally been yes.  But media is actually a triathlon, it 's three different events.  People like to consume, but they also like to produce, and they like to share. 

And what's astonished people who were committed to the structure of the previous society, prior to trying to take this surplus and do something interesting, is that they're discovering that when you offer people the opportunity to produce and to share, they'll take you up on that offer.

Values 2.0 is a strategic shift from a consumerist view to a more values focused, relationship-centric organization.

The Nature of Interaction

The question remains for us what is interaction? How can we interact about values so that they are more than some abstract concepts that has sentimental personal meaning, and little practical relevance?

Hugh MacLeod writes about the concept of "social objects." Here's how Hugh defines it.

The Social Object, in a nutshell, is the reason two people are talking to each other, as opposed to talking to somebody else. Human beings are social animals. We like to socialize. But if (we) think about it, there needs to be a reason for it to happen in the first place. That reason, that "node" in the social network, is what we call the Social Object.

I see values as social objects that function to united people together. Let us call them "operational values."  These values are ones that are utilized, operationalized, deploy, lived out in the operations of an organization.

For example, if trust is a core value of a company. Then actions of trust would be ones like transparency,

Values function to strengthen, support, guide and protect relationships within a social context. These are the kind of Core Values that Collins and Porras describe in Built to Last.

What are the interaction functions of an organization that are strengthened or empowered by values?

There are three human interaction functions that are enriched by values.

Communication in all its forms.

Decision-making and its implementation.

Evaluation of both people and company performance. 

When values are utilized in an operational sense, they shift from being abstractions for promotion, to practical beliefs that open up avenues of learning and discovery for meeting company goals.

A social object, according to Hugh MacLeod, could be anything. These objects are points of affinity that people share. It could be a local sports team, family history, spiritual beliefs, a music group, or a co-worker's fight with cancer. The stronger the affinity, the more personal the connection, the deeper the values are.  

Social objects are a connecting point. The values deepen and give purpose to the relationship.  For organizations, these social connecting points provide an additional means to quality people for employment.

The relationship starts with the social object - an introduction to one another- and deepens as values are identified.  The relationship finds vitality and sustainability as purpose and vision develop.

From this development, smart leaders will adapt their organizational structures to support the strengthening of the company's social environment.  This is how abstract values become operational values.  It is important that businesses understand what their values are. Not the boilerplate ideas of P.R. materials, but rather the beliefs and attitudes that people have about the company that they share and give them strength and hope.

Creating a Culture of Trust

At the beginning of this post, I wrote,

Values unify when shared, divide when not. Values create culture. Values guide culture, build trust in relationships, and strengthen a group of people to do the impossible.

In a Values 1.0 world, values are treated as Icons, as symbolic emblems that have meaning, but little relevance. In fact, the iconic values are in competition with the actual values of a company.

There is no choice about whether to have values or not. They are the most fundamental expression of who we are as human beings. There is no escaping their impact upon the functioning of any social or organizational environment. When ignored or conflicted, values become a source a divisive constraint on a business' ability to create impact.  When they are utilized as a platform for interaction, they build unity and a culture of trust.

In a Values 2.0 world, leaders understand that to build their corporate culture around a clearly identified and embraced set of values provides the conditions for creating a culture of trust.

Values - Culture of Trust

This diagram illustrates this connection.

Values are ideas that unify relationships and guide an organizational structure to create a culture of trust.

Is trust really that important? Ask the former employees and shareholders of Enron.  Ask the spouses of politicians caught having extra-marital affairs. Ask your children if trust is important.  In fact, ask them about their friends, or supposed friends, and you'll find that much of what passes for human relationships in a business setting is at the same level as a 15 year high school sophomore. It can be mean, nasty, petty and emotionally destructive. Ask your kids. They understand trust in a more immediate, fundamental way than we adults who play our word games with the idea.

Trust is earned by the integrity and impact of the organization.

The culture of an organization is representative of all the people, not just senior leadership.  The idea situation is for senior leaders to express respect down through the organization chart, while employees express trust up through it. In each case, at the heart of this exchange is a set of values that are shared, mutually believed in, and that create the unity that enable the company to do more.

The application of values is not the ultimate purpose of Values 2.0. It is rather a means to the creation of a culture of trust that elevates the prominence of the social environment to be a place that strengthens the organization. That is the long range purpose of utilizing values as a means to enhance interaction and impact.

The key is to begin. To take this one page conversation guide on Values 2.0 and see how one idea, with one person can become something more than a topic of conversation. Follow the line of thought from Idea to Interaction to Integration to Impact. This is a learning process, and the best learning is transformational. What better way to be value-added.


Values 2.0 Revisited

The 2.0 meme is built around the notion of interactivity. Web 1.0 is a static, brochure like website. Web 2.0 embraces social media as a context for online interactivity. The same distinction applies to how values factor into our lives and our organizations. Here's how I distinguish Values 1.0 from 2.0.

Values 2-0 diagrams

Values (see Circle of Impact) serve as a connecting idea for our relationships. They are ideas that connect through interaction and integration for the purpose of creating impact.

In a Values 1.0, there is little interactivity and consequently minimal integration of values into the life of the business. Values serve as icons, as symbols that are more  sentimental than foundational to how the functions.  As a result, a company's values have a marginal benefit to the operation.

For example, when a mission statement is never incorporated into the decision-making process of the company, yet emblazoned on plaques to be hung on the wall or the printed on the company's communications, that mission is iconic rather than alive.

In a Values 2.0 context, the emphasis is two-fold, interaction and integration.

A value like respect, for example, requires an understanding of what it means for each level of the company to experience it. It is integrated into the operation of the company when policies and practices are designed and implemented that insure that people have a way to be heard, and their ideas acted upon.

In this perspective, the values that we share in organizations transcend our mission, and our vision for impact. Circle of Impact PPT Values

OUR values inform OUR mission and define the way WE design and operate the organizational structures that serve as the context for OUR vision of impact.

The assumption behind this notion is that our relationships are the focal point for the work that goes on in an organization. The relationship can be between colleagues or with a client, but it is in that interaction that the work of the business takes place.

If there is no attention given to the values of the organization, then the emphasis on relationships is diminished as well. 

I'm revisiting this topic (see posts here and here)because I'm increasingly convinced that businesses need to see that their values are a key asset for providing a stable, sustainable context for growth. Adopting a Values 2.0 approach provides a basis for understanding how to create a more collaborative, socially healthy organization.


Real Life Leadership: In unpredictable economic times no set formula can bail businesses out

Today's Real Life Leadership column -In unpredictable economic times no set formula can bail businesses out - addresses the challenges that many businesses feel today about surviving this economic downturn.Transition_growth_or_decline

In reality, we aren't simply dealing with an economic downturn do to a low US dollar and high gas and commodity prices. There is a much more fundamental change taking place. Change is being thrust upon every business from multiple directions. We are in the midst of a transition economically and culturally that is greater than any of us have ever experienced. We are at a juncture between business has it has been done for generations, and business as it needs to be done in the future. We are a transition point of great change that is forces us to change as well.

Let me describe what I see in this way. There is change at the macro level. That is the level that is really beyond our control, but impacts us every day. For example, it is the rise in the cost of fuel as the demand for oil grows in developing countries.  You can cut back, but for how long. When does cutting back, begin to rob you of your ability to generate new customers and develop new revenue sources?

The micro side of change is the mind set that people who are your customers have about your business and services.  Recently, I talked with the CEO of a regional fast food chain.  He told me that his business is booming as customers shift their food purchasing dollar from more expensive restaurants to his.  He also pointed to the phenomenon of lunch-time customers at the drive-through window buying five and six different dinners, instead of one. He remarked that obviously someone is selected each day to drive to pick up lunch instead of everyone driving themselves.  He said that their emphasis on customer service has made it easy for them to accommodate these changes in his business.

While traveling in Wyoming on vacation, I spoke to the owner of resort business about how gas prices was affecting his business. He told me that the number of guests has remained steady, but their guests are spending less on the extra activities that they offer.

The agility of our businesses functions primarily at the micro level. We make changes that affect how we deal with our clients and customers today.  The problem for many businesses is that they get locked into a business model that restricts their ability to make changes. I'm surprised by the number of closed businesses that I see as I drive through town each day. I can only conclude that cash flow and debt service were the main contributing factors. Are these the outcomes of the inability to make the necessary changes to adapt to an economic downturn?

Did they not see this downturn coming?  Even if they had, what could they have done?  It is difficult to be come agile and adaptive as a business when you cash flow is suffering. You can't wait until you need to adapt to learn how to adapt.

I believe it goes to what I state in the column.

You have to understand why your customers buy from you. You have to understand what the impact is. What is the difference you make that ranks high enough that they are still willing to spend their money on your business?  If you don't know then you need to find out.

As a result, it goes to my second point, which is, you have to understand that what your values are. Values aren't some warm and fuzzy inspiring ideas that you market. No, they are the core strength of your business. They are what brings you, your employees and your customers together around a set of ideas that matter in your relationships with each other.

For example, if you say the customer comes first, but you haven't ask them how to serve them during this economic downturn, then that value is really irrelevant to your business. You are making your decisions based on the assumptions you make about your customers, not what you actually know.

Here are two simple diagrams to illustrate what I mean. Values_1_simple

The first is what I call Values 1.0. This is the traditional approach to values. These values are ideas that are iconic. They are symbolic of some other value. If customer service is an iconic value, then it stands for a long-standing approach to customer service that has basically become irrelevant to today's customer.

Here's an example. Recently, I was at an upscale Italian restaurant, part of a regional chain, and one that I've eaten in dozens of times. I was there by myself. My server took my order. A "runner" brought my tea and salad. Then another runner brought my main course. During the salad portion of my dinner, a young woman came by, and asked if I was pleased with the salad. We talked for about 20 seconds. I then asked her what her job was there. She was not dressed as a server. She told me she assists the floor manager to do whatever he needs her to do. And she does the restaurant's books in the morning.  We had a nice chat, and she left. She stopped by two more times before my server returned to ask how I was doing, and see if I wanted dessert.  At one point, I sat there for about five minutes needing a tea refill before another server returning from her section saw my empty glass and filled it.  The restaurant had plenty of people to serve me. The problem was they were really unaware that I was there.

The values of customer service has to be more than talk and marketing speak.  It has to become an Values_2_simple_2 awareness of the situation your customer is in so you can respond to them. This is where my notion of Values 2.0 comes from.

At the restaurant, the assistant to the manager should have been aware of my tea need as she chatted with me each time. My server, obviously, should have been more attentive.  The deeper issue is that we don't talk with our customers about these issues. A response card at the door isn't a conversation with the customer. It is much easier to fall into the trap of assuming that what we are doing today for our customers will be fine tomorrow.

When we talk with our customers about what they want and desire from our busienss, we are employing our customer service values in our interactions with them. When we take seriously their ideas, and integrate them into how we service them, then we find that our values have in impact upon our business and our customers.

The inability of a business to adapt to an economic downturn is born in that business leader's assumption that he knows what his customers want and need, and more importantly will always be there.

Adapting to the macro and micro worlds of change require us to be grounded in values that transcend the situation. They are the strength that enable us to persist through difficult times, and make the hard decisions to change before our options have run out. 

I'm convinced more and more that the key to managing change is found in living the values that are the core strengths of our business. To do so requires us to change. As a result, the hardest change is personal, and what confronts each of us every single day.

If you like,here is a hard copy of today's column that you can download.


31 Questions: values

27. What role do values have in the development of leadership teams?

The role of values in organizations is changing.  The simplest way to understand it is with my notion of Values 2.0.

Values 2.0 is analogous to Web 2.0. Web 1.0 is websites that function as online brochures distributing relavent information about a business.  Web 2.0 is websites that are focused on the interaction between people, between businesses and their customers. All the popular social networking sites are Web 2.0.

Values in a Values 1.0 perspective are ideas that are meaningful, but serve a more symbolic purpose. TheyValues_1_simple are like the icons on your computer desktop. They are a reference point to some meaning that has value. The are Iconic because they can serve a branding function to point to a characteristic that the business would like its audience to identify.  The problem with Values 1.0 is that they are largely irrelevant to the functioning of the business.

Values 2.0, like Web 2.0, function in an interactive environment. They are not simply ideas posted on theValues_2_simple_2 wall or website for all to see and admire. Instead, they are ideas that are injected into the conversation that takes place in every organization. This interaction begins with questions. "What are our values? How do they fit into our culture? How do they help us or protect us?"

In a Values 2.0 organization, values are integrated into the organization through the relationships of people, and then into the operational processes of the company. Values become a tool for understanding where opportunities and problems are, and more importantly how to make strategic decisions.

Umair Haque regularly writes about the DNA of organizations as being the source of its life. Values are key elements in that DNA. When values are iconic, they are a reflection of the past than the present. Values that have impact are active agents in the DNA of a company.

With this background to my thinking about values, let's restate the question where we began.

What role do values have in the development of leadership teams?

Or, if values are to have a place at the table in your team interaction, how should they be introduced?

If you don't know, you need to ask.

Why?

Because there are values integrated into your organization and your team work. Enron, the poster child of companies that failed because of their values, had values, just one's that were unethical and ultimately destructive to its life as a company.

What role do you want values to have in your teamwork? Start with that question, and ask it over and over until you get an answer that makes sense.

Before you ask it of your team, ask it of yourself.

What role do I want values to have as I lead?

And, what values should they be?


Values 2.0: A Culture of Trust

In my last post I wrote,

Values unify when shared, divide when not. Values create culture. Values guide culture, build trust in relationships, and strengthen a group of people to do the impossible.

In a Values 1.0 world, values are treated as Icons, as symbolic emblems that have meaning but little relevance. In fact, the iconic values are in competition with the actual values of a company. Valuescultureoftrust

There is no choice about whether to have values or not. They are fundamental to who we are as human beings. You cannot escape their impact upon the functioning of any social environment. They are basic expressions of human nature. When ignored, they become competitive, divisive and a constraint on the business' ability to create impact.  When they are developed, they build unity and a culture of trust.

In a Values 2.0 world, leaders understand that to build their corporate culture around a clearly identified and embraced set of values provides the conditions for creating a culture of trust. This diagram illustrates this connection.

Values are ideas that unify relationships and guide an organizational structure to create a culture of trust.

Is trust really that important? Ask the former employees and shareholders of Enron.  Ask the spouses of politicians caught in prostitution rings. Ask your children if trust is important.  In fact, ask them about their friends, or supposed friends, and you'll find that much of what passes for human relationships in a business setting is at the same level as a 15 year high school sophomore. It can be mean, nasty, petty and emotionally destructive. Ask your kids. They understand trust in a more immediate, fundamental way than we adults who play our word games with the idea.

Trust is at the heart of the respect that a company seeks to earn by its integrity and impact. Violate that trust, and the culture of the company is ripped in two.

The culture of an organization is representative of all the people, not just senior leadership. It is an exchange of attitudes towards one another. We could say that senior leaders express respect down through the organization chart, while employees express trust up through it. In each case, at the heart of this exchange is a set of values that are shared, mutually believed in, and that create the unity that enable the company to do more.

How do they do more? That's for another posting. But let's just assume that creating a culture of trust has the effect of increasing ROEI, return-on-employee-investment, by more than cost cutting can increase the bottomline.


Values 2.0: The difference between Values and Value added

Is there a difference between values and value added?  Let's define them.

Value: a measurement of impact or benefit. For example, I hear often the phrase "value added" which means that the client is receiving more than what they expected. There is a higher level of impact or benefit.  The value can be a Return-On-Investment (ROI) figure. Or it can be something less quantitative, more qualitative.  In those instances, the measure is based on an idea of value. Most likely that idea is what we would call a value.

Values: An idea that defines meaning. Typically we'd see values as those ideas that point to a purpose or a standard.  Values unify when shared, divide when not. Values create culture. Values guide culture, build trust in relationships, and strengthen a group of people to do the impossible.

For example, you are sitting in a meeting and a cell phone rings. The person across the table answers it, speaks for a minute, laughs out loud, and hangs up. No comment. No apology. Just acts as if nothing happened. This typical experience may be widely accepted, but it is also rude. The judgment that he was rude is based on values that govern the social relationships of people. Typically we call it etiquette.  Those values are ideas about what is appropriate behavior in a meeting. The values of respect and courtesy demand some sort of accommodation to the ever present cell phone. What is more important the cell phone call or the meeting? That judgment is based on what you value, and what you value is based on ideas of meaning.

(*Note: Why can't cell phone manufacturers include a out of office button like email programs do?)

Values are the ideological foundation of human interaction. They are the fundamental beliefs that create a culture, and as we all know every organization is run by a prescribed culture. Ask a GE person or a Proctor&Gamble person about their culture, and they can describe values that govern how they work together.  Read Jim Collins and Jerry Porras' book Built To Last and you'll get a clear idea of the relation of values to a corporate culture.

If you want to provide value-added products and services, ask yourself, "What values am I utilizing to increase my value-added impact?"

HT: TVM for the cell phone story


Values - Museum Artifact or Living History?

In my previous post, I write about a distinction in understanding the nature and use of values in an organizational context.  I characterize the older, more traditional approach Values 1.0, and the newer, more social approach, Values 2.0.  Here's a way to understand the difference.

Values are ideas about what is important to us.  In an organizational context, these ideas are intended to project a certain image about the company. Whether the value is being "dependable" or "fun" the effect is to make a statement that describes what the company believes in or stands for. This is the traditional approach to values. They are statements. 

What if we treated values as an historical artifact. You go to a museum, and there next to room with the life-size model of a Tyrannosaurus Rex is the Hall of Values. You walk in see a frame with a magazine ad for "ACME Dynamite Company - Dependable Explosions since 1904."  Then there is a statue of a man in a business suit and a sign that simply says "Trust."  In rear of the hall, there is a display of an auto assembly line from the 1950's with a sign that says, "Innovation."

We see concepts applied to business as a way of distinguishing them from their competitors. We call this branding or marketing, of course. But we treat values in much the same way. They are like museum artifacts. There is an ancient, historical character to words like "trust", "dependable", or "integrity." They are words that signify a specific meaning.  These words are recollections of a past time. They are fixed images of the company that remain the values impression of the company into the future, regardless of whether they are accurate or not. These are values in a Value 1.0 world.

We know when there is a breakdown between the espoused values of the company, and reality. When a company sells itself as trustworthy, dependable and operating with the highest integrity, and in the morning newspaper we read of the embezzlement of millions of dollars by a top official, we know that the values no longer command attention like they did in the past. This disconnect leads people to believe that the value words are hollow. Have enough of this occurrences, and people believe that this isn't one company but a whole culture of corruption. 

It may well be true that 99% of the company's employees are trustworthy, dependable and have integrity.  The moral failures of a few are thrust upon the many who remain behind to pick up the pieces of a tattered reputation. Values reduced to ad copy or a relic in the company museum set up the conditions for failure.

Values 1.0 treats values as museum pieces. Leaders are curators of those values. We parade the values out for celebrations, then return them to their rightful place in a closet in the marketing department. I'm not blaming marketers for this situation. In fact, they may be the only ones in touch with the values of the company as they try to sell the company's products and services to the public.

Values 2.0 is very different. Instead of values being museum artifacts, they are like living history experiences that take on a life of their own. Here are two examples.

In Staunton, Virginia, there is a fascinating museum of frontier culture - The Frontier Culture Museum of Virginia. What is interesting about this museum is that it consists different working farms. There are English, German, Irish, and American farms, and an African village. Here's living history, not static displays of pictures in frames or exhibits in glass-enclosed cases. If you are traveling through the Shenandoah Valley of Virginia on I-81, I recommend a visit.

Several years ago, a local college professor opened his Civil War history class to non-students. A part of his class was the recreation of a civil war battle. There were Union and Confederate regiments, townspeople and even a preacher for both sides. My great, great grand father, William Newton Morrison, was the pastor of the Presbyterian church in the Swannanoa Valley of Western North Carolina, during the Civil War. In fact, the church he served stood on a hill over looking the field where our Civil War enactment was held. My part in this living history experience was to play my ancestor. I put on appropriate dress, found a suitable sermon preached by a Presbyterian pastor in Fayetteville, N.C. during the war, and prepared a five minute service for the troops before they went into battle. It was quite an experience to recreate that moment of a preacher sending troops off to battle.  I was surprised by the emotion of the moment, especially with the fire-brand sermon I had selected to present.

Values 2.0 isn't about static museum displays, but about living the values. If they are historic values of the company, recreating the experiences that led to a particular values becoming the company's values may be needed. For example, often I hear from people that their company used to be like a family. We care for each other like family. They knew their spouses and kids because their were softball teams in the spring and company picnics in the summer. If being a family is a value that is a part of the company's DNA, then create opportunities to be a family. Set up committees to raise money to help "family" members in need. Just don't talk about the glory days of the past when you were like a family. Be a family now.

Values 2.0 is about living values. If the values mean something, then they will mean more lived out in the relationships and the processes of the company. The ideal is simple. The application not so simple.  It requires work to integrate values into the work of a company. Yet that is what Values 2.0 is about.   


Values 2.0

The Value of Values
For the past year I have been involved with a project where values are at the center of the development of leadership teams and organizational development. In this project, a cross-section of the company developed a values statement that they believe, and I concur, is representative of the values of the company's people. Their values statement has been warmly and enthusiastically received by the company. I'm very pleased by this and the efforts that their leadership has made to inform and deploy the values throughout the company.

My conclusion having gone through this experience is that values are a social mechanism that unites people around a set of shared ideas or beliefs. Whether the idea is integrity or creativity, the idea provides meaning and purpose for people. When that idea is shared with others who also value it, a social context for their relationships makes a difference in ways not possible otherwise.

I also see that the values culture of a business is integral to the healthy functioning of human relationships within an organizational context.  Too many organizations ignore this facet of leadership. They treat values as an ancillary exercise that is elective and marginal in impact. I'm convinced that a shift in understanding is taking place that is changing not only the conception of values, but the application of them within organizations.

Social Objects

I've been a regular reader of Hugh MacLeod's GapingVoid blog for a long time. I find him one of the most insightful and practical thinkers around. What caught my eye was an idea that he has written and spoken about called "social objects." Here's how Hugh defines a social object.

The Social Object, in a nutshell, is the reason two people are talking to each other, as opposed to talking to somebody else. Human beings are social animals. We like to socialize. But if (we) think about it, there needs to be a reason for it to happen in the first place. That reason, that "node" in the social network, is what we call the Social Object.

What Hugh sees as a social object is what I see as the operationalized values that function to united people together. By "operational values" I mean those values that are actually utilized in the operations of an organization. Values function to strengthen, support, guide and protect relationships within a social context.

What functions of the organizational structure are strengthened or empowered by values? There are three human interaction functions that are enriched by values. Those functions are communication in all its forms, decision-making and its implementation, and evaluation of both people and company performance.  When values are utilized in an operational sense, they shift from being abstract, not very practical ideas to practical beliefs that open up avenues of learning and discovery for meeting company goals.

A social object, according to Hugh, could be anything. These objects are points of affinity that people share. It could be the Red Sox, or Scottish Nationalism. The stronger the affinity, the deeper the values are.  For example, it is one thing to say you follow the Red Sox, and another to say that you are a citizen of Red Sox Nation.  It is one thing to say that you are of Scottish heritage and another to be a vocal advocate for Scottish Independence. Social objects function to identify a shared affinity between people.  They can be shallow or deeply personal. They serve the same purpose of connecting people to one another. The stronger the affinity, the greater potential for the values to impact the relationship.

Social objects are a connecting point. The values deepen and give purpose to the relationship beyond the occasion.  What this leads to is the importance for organizations to hire people who connect with the values of the company.  The relationship starts with the social object - an introduction to one another- and deepens as values are identified.  The relationship finds vitality and sustainability as purpose and vision develop. From this development, smart leaders will adapt their organizational structures to support the strengthening of the company's social environment.  This is partly what I mean by operationalizing values.  Therefore, it is important that businesses understand what their values are. Not the abstract, boilerplate ideas of P.R. materials, but rather the beliefs and attitudes that people have about the company that they share and give them strength and hope.

Values 2.0
We are entering a new era regarding organizational values. It is an analog to the shift that Neville Hobson describes in this video. He says that the web has shifted. It used to be that websites were "read only ... (and now, we're) seeing a shift to read - write. You can read and write." The same shift is taking place on the values front.

Values 1.O are values as boilerplate ideas that serve some abstract function. They represent some detached idea that does not empower or strengthen. Values 2.0 are the ideas that give people reason to unite around a share purpose of who they are and what their company stands for.  They can be distinguished in this way.

Values 1.0 - Ideas - Icon - Irrelevance

Values 2.0 - Ideas - Interaction - Integration - Impact

Placed in the context of the three dimensions of leadership, values serve an important role, just as do a clear mission, a compelling vision and a healthy organizational structure.Missionvaluesvisionideasthatconnect

Values matter at the most basic point of human interaction.  Values increasingly matter in a business climate that requires greater people interaction skills to meet the complex demands.  Values are not pablum. They are the super-glue on steroids that unite people together for the work they must do.

The heart of Values 2.0 is action and human interaction. We are not talking about lovely sentimental ideas that are printed on posters and hung on the back of office doors. We are talking about the ideas of substance that support and guide people in their interactions.

For example, trust is a much discussed value in business today. Bookstore shelves are full of books about trust and ethics in business. However, just believing that trust is important is not the same thing as being trustworthy. Valuing trust is not the same as being trustworthy. What does it mean to be worthy of trust? What are people entrusting to one another and their companies? Aren't so many approaches to trust nowadays reactive, defensive approaches to the idea?  Are not most treatments of trust about how to stay out of trouble?  Is staying out of trouble the same thing as being trustworthy? I don't think so. Trust is an active ingredient in human relationships. Without it unity and commitment to shared goals is not sustainable.

If Values 2.0 is similar in character to Web 2.0, then an ongoing discussion about how to operationalize trust needs to begin in organizations. How does trust fit into your communication methodologies and products? Is it possible to be honest and not violate confidences?  What role does trust have in decision-making and evaluation? If trust matters, then it is worth talking about, organizing and measuring. I don't believe there is a formula to this. Values that are utilized in an organizational context are arrived at by conversation and practice.

Hugh MacLeod's simple, yet brilliant idea of social objects provides us a way to understand the role that values have in relationships. Watch this short video of him describing the idea. Place those social encounters in a business context, and you begin to see how quickly we can be talking about values and their integration into business processes.

How do we make this shift from Values 1.0 to Values 2.0?  Let's talk about it and see what we can learn together.

UPDATE: I've put together an one page conversation guide on Values 2.0. It follows the line of thought of Idea - Interaction - Integration - Impact. You can access the chart any time at the Impact Leadership list in the top right column.