Sometimes an organisation’s publicly expressed values can do more harm than good. You can find them on the website of almost any company: a set of principles built around terms such as “integrity” and “innovation” – ideals designed to match seamlessly with a client’s expectations.
The problem arises when an organisation determines its values on the basis of what’s considered best practice and then tries to impose them on a workplace culture where, it turns out, these principles are easier said than done.
A five-year study at the University of Chicago found there was no correlation between an organisation’s proclaimed values and its financial performance. In fact, a written statement of standards, by itself, is bound to prove inadequate – particularly if it’s instilled from the top down without any collaboration from employees.
That’s why behaviour that feels out of sync with a company’s expressed values is likely to create an environment of disengagement and cynicism. The perception that management is merely paying ‘lip service’ to ideals can not only lead to increased absenteeism and turnover rates, but the potential for far more damaging crises. Repairing that level of dysfunction can be a difficult and lengthy process.
‘Cultural shortcomings’
In the case of Barclays bank, the organisation initiated an independent review of its business practices in 2012 after being implicated in the Libor rate-fixing scandal. The review found the bank’s rapid expansion led to “cultural shortcomings” where, among several other factors, there was no sense of common purpose and a perception that senior management did not want to hear bad news. In response, Barclays launched its Transform programme, part of which focused on reforming the bank’s culture by emphasising values such as stewardship, service and respect.
The Great Place to Work Trust Index gauges the effectiveness of such value systems through the candid feedback of employees. Last year, in comparing the UK’s 50 Best Workplaces with organisations that were not listed in 2014, the survey found a 27 per cent point differential in two critical categories: the belief that management’s actions matched its words and the belief that management could deliver on its promises. The unlisted organisations, this would suggest, were experiencing a disparity in thinking between its leadership and its front-line staff.
The University of Chicago’s study researched what kind of difference this could make. It found that when a set of ethical principles are clearly being implemented, an organisation is more likely to achieve better financial results than its peers. It also concluded that the stock market underestimates the value of corporate culture and the long-term effects it can have.
Customer satisfaction
There is an obvious correlation, for instance, between high levels of integrity and customer satisfaction. These values not only have to be modelled by senior personnel but translated into behaviours which can then be measured and managed.
Committing to that practice for the sake of long-term benefits may not be an easy ask for publicly quoted companies, given their emphasis on quarterly results. This is why Business In The Community, a network for social corporate responsibility, is calling for a means of publicly disclosing non-financial measures that reflect employees’ attitudes and well-being. In the meantime, one way of addressing organisational imbalance is through a Great Place to Work ‘culture audit’. This allows a business to detect any discord in the application of its values. If a company’s culture has already been shaped by principles that are implicit, rather than stated, this provides an opportunity to articulate what they are. That way, a company stands a better chance of maintaining a cohesive identity and achieving the standards it expects of itself.