Why Every Business Should Have Values
At its core, business is about making money, right?
Depends who you ask...
(cue small business owner)
I don't think so. At least in the creative industries, it seems to be more about building relationships, proving your abilities and finding the true value of your work. In another part of the business world it could be something completely different that drives the road towards success, but no matter what it is you're in business for, your company should have a clear set of values. Let's see why.
They show that the sole purpose isn't profit
It's totally cool if a company's purpose is to make a profit and succeed financially. Every business needs that. However, there's a point at which this can transform from being a healthy money-making endeavour to being an unsustainable one, and it's important to know where that is, so let's grab a pizza...
Pizza Joint A is a busy place. All day every day, patrons are lining up for a pizza, because they know A can deliver some quality dough. Despite being in a competitive industry, A has a healthy profit margin each year. A is looking to maximise profit, but sees it as essential to make employees feel valued in order to minimise staff turnover, and is therefore open to reviewing employees' wages upon request. A also wants to uphold high standards of cleanliness, to ensure a great experience for customers and to maximise repeat business. Additionally, A pays slightly more for ingredients to make sure they're ethically sourced and sustainably produced, costs that are ultimately absorbed by the business so they can remain competitive. In A's model, a percentage of profits are reinvested where seen as essential to uphold the business' brand and values, and to them it ensures they'll be able to stay in business for a long time. A is highly valued by the local community and is a successful business.
Pizza Joint B is booming. Being open 24 hours, they get all kinds of customers, and the unmatched low pricing of their pizzas attracts people from all over the city they service. B is able to make a hearty profit, higher than most of its' competitors. This seems to come at a cost however, as employees rarely stay with B for more than 6 months, complaining of inflexible working conditions, low pay with little chance of increase, feeling undervalued and overworked, and witnessing corner-cutting in the areas of food safety, workplace safety and ingredient quality. As a result, they're known to lose customers from time to time. B's focus is to make as much money as possible, which means reinvesting only when absolutely necessary and sacrificing other things in the process. B is a successful business too.
After reading that, which company would you rather run? Furthermore, where would you buy your next pizza?
People have values, so why should companies not?
Whether you're aware of it or not, you have a personal set of values that you live by. Figuring out exactly what these are can be hard, but the choices you make every day are guided by your underlying value system.
This leads me to the question - why should a company not live by the same system? Companies are made up of people, and apart from those people, they are pretty much fictional. Sure, a company has a website and a building, but it wouldn't exist if it weren't for those who perceived it and those who run it every day.
A company with no values is ultimately a company without a personality.
They separate the business from competitors
Giving a company values gives it a unique identity, and makes it just that little bit more like a person. Human-esque features like this are things that potential employees and patrons can relate to, and if they agree with the values it may just make them want to work with you more.
Even showing that a company has a code of some sort, no matter what it looks like, will show that the company is on a mission and has a sense of responsibility, and this could impact first impressions in a positive way.
Furthermore, even if all your competitors have their values set out and in the open for all to see, chances are they are different values to your company's.
They'll help guide the direction of a business
A business without any values can be a directionless one, and not having concise goals to work towards is what causes a lot of young companies to fall.
Imagine a freelance graphic designer starting a company for the sake of being a company, so they could claim expenses related to their line of work, be a bit more savvy with their income and see where it goes from there. The founder would be thrilled if it grew into a booming business, but doesn't really know where to start and doesn't have the time to develop the idea very much, so the company begins with little to no identity. After a year or so, the founder is unhappy with the amount of growth and realises that it costs money to run a company so goes back to being a freelancer and ceases trading as the company.
Having values in place from the beginning can help guide decision making and can actually inspire the creation of a whole unique brand and offering - something that can to lead to success.
We are a young company in New Zealand looking to prosper while staying true to its values. If you'd like to see those values, check out The Champion Way.
I hope you've gained something from reading this - when in doubt, get your values out.