Culture change can’t happen, nor can a company’s culture survive, without the active support of the CEO.

If you look at today’s most successful companies, you’ll notice that they share something in common. Regardless of size or industry, and whether they’re consumer or business focused, top-performing organizations are driven by values and a value-based culture.

For more than two decades, and most recently at People Ink, I have helped a wide range of companies— including JetBlue Airways, Restoration Hardware, Disney and P.F. Chang’s—adopt a values-based culture and use those values to drive performance excellence.

Every company’s culture is different, but in my experience, each one needs to be supported by these five key factors in order to be authentic, durable and effective.

 

Build leadership commitment

Culture change can’t happen, nor can a company’s culture survive, without the active support of the CEO. In addition to establishing the company culture and creating a governance structure that aligns the organization with those cultural values, the CEO needs to find meaningful ways of communicating those values. Great cultures tell great stories, and CEOs need to reinvent themselves as ‘Chief Experience Officers’ and master storytellers who define the culture and values in meaningful ways.

Example: Starting in 2000, the CEO of JetBlue has sent out an email to the entire company every Sunday to share a story about an employee who lives the company’s values through their actions at work. That adds up to nearly 900 Sundays and 900 stories shared. It’s that long-term commitment to reinforcing and celebrating the values-based culture that gives it strength and meaning.

Create a values blueprint

Values don’t just happen. They are created through a formal process that brings the right stakeholders together to brainstorm, prioritize, and finalize no more than 5 – 7 values that define the organization. Involve people from all aspects of the business to contribute, and stack the deck with your “A” players—those top-performing employees who understand the company’s vision.

Translate values into a blueprint of behaviors that every employee should model in their daily performance.

Creating those values is one thing. Living them day after day is another. Once you’ve identified your values, don’t just put them up on the wall and admire them. You need to turn them into a culture engine blueprint capable of leveraging those values across the organization. The first step is to translate those values into the behaviors that every employee needs to model in their daily performance. The next step is to establish a values committee to ensure that your values are represented in everything your company does, from helping an employee in need to evaluating the CEO.

Hire “A” players

Your values-based culture needs to guide talent acquisition and help you hire A players—the people who have not just the skills but also the values that align with the company’s goals.

To spot those A players, look at their past behaviors. Behavior is 90% predictive, so if you can find out how someone behaved in the past, you can predict the way they’ll behave on the job with you.

Example: A healthcare organization whose values included “caring” asked an interviewee for a nursing job to provide an example of a time when she demonstrated that value at work. She responded with a story about caring for a patient who gave up her baby to foster care because he had serious health issues that she couldn’t cope with. The nurse adopted the child and cared for him for the six months that he lived. Clearly, that’s an A player for an organization built on caring.

I urge the companies I work with to weight values equally with competencies when evaluating talent. If a culturally toxic employee is hired or allowed to stay on simply on the basis of their skill profile, the company loses credibility, its employees lose faith and its culture is undermined.

Create accountability and rewards

Keeping a values-based culture strong requires a system of accountability and rewards. People need to know when their behaviors don’t align with the company’s values and be held accountable for the outcomes. It’s equally important to celebrate and share those moments when employees live the values and go above and beyond.

Many organizations, including those in the LLR Partners portfolio, are finding innovative ways to reward their employees. I recently spoke to LLR’s portfolio companies at their annual CEO Collaborate gathering and learned about some of the ways their CEOs embody corporate values and use reward systems. At IOD Incorporated (now part of Ciox Health), the organization’s leaders started handing out badges to recognize employees on Yammer. At Orbis Education and Numotion, the CEOs make anniversary calls to personally recognize the contribution of every long-serving employee.

CEOs need to reinvent themselves as ‘Chief Experience Officers’ and master storytellers who define the culture and values in meaningful ways.

I’m seeing some interesting ways to create accountability, too. My former client JetBlue created an app that delivers key performance metrics to every employee’s iPhone every day, so that whether they’re accountable for cost reduction, health and safety, or customer satisfaction, they can see what they need to achieve as well as the impact they’re making.

Build your customer brand

How you act internally is how you are perceived externally. Your organization’s values and employee engagement will drive your client engagement. And every employee—every day and with every interaction—has the power to build or destroy your brand.

When we hired Bain to identify the most important part of the JetBlue experience, they looked at every single element—from ticket prices to in-flight entertainment—to find out what stood out. The research clearly showed that employee service was the key differentiator. Our values-driven behaviors defined our customer brand, and that has held true for every organization I have worked with.

Example: A pilot at Southwest went against policy and held a flight so that a passenger could reach the hospital in time to say goodbye to his dying grandson. While other airlines might have disciplined the pilot for his actions, the CEO of Southwest called the pilot to thank him for living the company’s values. The pilot’s actions generated massive amounts of goodwill and shone a very public spotlight on Southwest’s dedication to customer service.

Here’s the bottom line.

A values-based culture is powerful. It drives employee engagement, organizational performance and customer satisfaction and loyalty. But it doesn’t just happen. As CEO, your job is to lead it, live it and build processes that support employees to model behaviors and make decisions that strengthen those values every day.

 

LLR Partners believes in sharing the wealth of experience and expertise within our portfolio companies, network and teams in order to inspire and help accelerate growth for a wider community of business leaders. We hope you find these GrowthBits helpful and share them with your network. Send us the topics you’d like to learn more about any time.

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