The Power of Values

Vision and mission statements are useful documents, but they can be very hard to craft in a way that is meaningful. Organizational values, on the other hand, are more straightforward to articulate and much more accessible by the organization. This month I am going to explore, in two parts, the fundamentals of corporate values, using the story of a sleepy community bank.

When I first encountered D Bank — a pseudonym for reasons that will be obvious — visiting its offices was like commuting to 1970. The bank was organized squarely around efficiency and compliance. It was a mutual savings bank with assets of about $850 million and was going to be the last mutual standing as far as the board was concerned. In a static world, it would have done business that way forever. Anyone reading this operate in a static world?

It was in this environment that Paul came to the chairman and CEO position. Paul had started at D Bank as an assistant teller more years ago than he wanted to talk about. He had worked his way to the presidency, and when he took the reins of the bank, he had no particular fire in his belly except to have an easy life.

  • Lesson One: Values are only valuable if they are specific, clearly articulated and relevant to the company’s business.

I met Paul when D Bank asked if I could plan and facilitate its annual manager’s meeting. We explored the topic of using the event as a platform for the values Paul wanted to use to guide his tenure as D Bank’s leader. But Paul believed that the organization was clear on the values of honesty, integrity and a fair profit and what they meant to the bank’s business. However, the employee survey we undertook told a different story and presented Paul with a conundrum. Most employees could not articulate D Bank’s core values, and those who could thought that they were trite and not connected to the business.

  • Lesson Two: Actions speak louder than words, especially in the executive suite.

The plan was to report on the values research and facilitate a discussion about core values at the executive retreat a month before the bankwide manager’s meeting. This was already revolutionary, as historically the primary activity at the retreat was a presentation of benchmark data from a market research consultant. Paul blocked half a day for the values discussion. However, the benchmarking presentation took longer than planned owing to the amount of M&A activity in D Bank’s footprint. When it was finally done, there was less than 30 minutes for the values discussion.

Paul noticed that the scorekeeping conversation pushed out everything else at the retreat — except golf. He came to the realization that both he and his staff were reticent to take on values because it felt like Pandora’s box. But Paul also saw something else on the horizon. The benchmarking data and trends he read about in trade publications led him to understand that D Bank could not continue to operate in the way it had and survive.

Paul began to see the values discussion as a way to create a different vision of D Bank from the ground up — and it both frightened and excited him. His first step in that direction was to invite his executive team to an event unique in the history of the institution: a second retreat the following week that would focus only on organizational values and would be conducted at a site with no golf course.

For D Bank, this event was equivalent to the famous shot heard round the world.

Next week: Stated values have power, even if they are not true.

Originally published in Arkansas Business, Barry Goldberg On Leadership, August 8, 2005.