Writing on the walls

By VIKKI BLAND

Are company values valuable or just dusty words on a wall? According to three companies that have spent thousands getting their values straight, the answer depends on whether company values are created to live by or look at.

George Adams, managing director for Coca-Cola Amatil, says: "Not surprisingly, it's what you do with a value that counts."

Jan Mottram, director of human resources for Vodafone New Zealand, says company values are fundamental to business success because of an alignment between internally enforced values and the customer experience. Put another way; what your employees believe your company is about will be what your customers believe it's about.

"Values should align with brand and image. One of the best comments for us is when people say what they expected Vodafone to be like from observing it from the outside was what it was like when they got to the inside," says Mottram.

Unlike Coca-Cola Amatil, Vodafone has developed a set of core values independent of its international parent.

"Vodafone's global values were introduced after Vodafone New Zealand had done its initial values work. [But] the global values are centred on passion and there's nothing we do locally that doesn't reflect passion," says Mottram.

Ross Peat, managing director for Microsoft New Zealand, says Microsoft New Zealand uses the core values of the Microsoft parent corporation and these are crucial to building a business strategically. "Shared vision and values provide a framework for other strategies; you have to build that framework before you can go to market."

Having described the importance of values, each executive is keen to define what a value is.

"People shouldn't confuse personal ethics, morals and judgments with company values. We couldn't presume to tell people how to live; company values are the behaviours we expect Vodafone employees to place priority and importance on," says Mottram.

Peat says values are an anchor for professional behaviour, and have internal and external impact.

"As a managing director following Microsoft's core values I must speak to my staff in a way that is open and respectful, and be self critical and open to corrective feedback myself."

Adams agrees with Peat that management has to live by the values it establishes.

"We ran into a bit of a situation at Christmas when certain stock levels ran lower than normal. We had our people working extra shifts to keep up, and we asked them how they thought the issue should be handled. They came up with four extra days off at Christmas and getting [managers] on the [bottling] lines. Actually, it was a bit of fun."

But do employees genuinely believe in company values or are they simply paying lip service to impress at performance review time?

Adams says lip service will occur if the words stay on the wall but employees that observe a practical application of values led from the top will buy in quickly. He says values are inextricably linked to company pride, and internal accountability gives values power.

"Peer pressure helps people to conform. We've printed up little cards with our values on them so that our employees can actually "card" each other. We find individuals will take up issues of behaviour with others. [Additionally] if people do not follow company values it shows up in performance reviews."

Apart from "walking the walk" and using accountability for enforcement, how does a company know when it's time to establish or refresh core values?

Adams says when a former employer, Ireland's Coca-Cola Hellenic Bottling Company, merged with Ireland's Coca-Cola Beverages, the newly merged company used outside help in the form of the McKinsey Group to define a short set of values.

"We worked with hundreds of people across the two management groups and created a central set of values that everyone felt comfortable with."

He says it is important to cyclically refresh values because long-serving employees become cynical as values don't work or become outdated.

"When we refresh, we can say yes, we tried that last time and it didn't work, but this time we are going to do it differently."

Mottram says Vodafone is in the midst of a values refreshment exercise and there is a need to refresh, evolve and update company values every four years.

She says Vodafone sees its market position as changed from a mobile network market challenger to the dominant player, and so a corresponding values change is necessary.

"We seek an alignment between the refreshed values and what we want the customer experience to be. It takes between nine and 12 months to tweak company culture and build new values into the DNA of the organisation."

But exactly how does a company "DNA code" values?

Mottram says people are typically passionate about values and don't take them lightly. The answer is to make it clear to employees what value changes are occurring and why, and to involve them in the process.

"When we started the refreshment process we looked for where the values aligned and where they didn't. We came up with a set we thought were about right and presented them to the wider management team. Then there was a bit of a push back; we hadn't taken long enough to work through the employee groups. We learned from that."

To rectify the need for more staff involvement, the Vodafone executive team appointed a sub group who were tasked with finalising the values. Vodafone then ran a company wide series of briefing sessions.

"We took a week out of our lives as directors and worked through a thousand people. We did it in a fun way; using comedians, a staged show, and interactive exercises. We told our staff: every single one of you is a director of the customer experience - that's why it's so important you understood the values and why we have them."

Adams says Coca-Cola Amatil has traditionally used focus groups and tested each value by gathering verbal and survey feedback. For future refreshments, he says he would be tempted to follow the Irish example and engage outside expertise.

"[Outsourcing] keeps you aware of the best thinking as to how to achieve it. But HBC [in Ireland] had 40,000-odd staff, so it was on a different scale with different budgets."

Whatever the budget, it seems clear establishing company values that work is time consuming and expensive. So what's the business payback?

Adams says internal testing shows 70 per cent of Coca-Cola Amatil company values are [agreed with] by employees. He then draws a line to the company's successful balanced scorecard result which puts it near the top of the international Coca-Cola bottling heap in terms of manufacturing, efficiency and output.

Mottram says while establishing company values takes resources, time, money and energy, it's the right thing to do.

"You have to have an underlying belief that people make the difference. If you show people you value them [through the values you uphold] you will soon realise the business benefits you are looking for."

She says Vodafone examines its values investment against turnover and productivity measures, and finds running a leadership programme in tandem with values refreshment enhances the impact of both initiatives.

Microsoft's Peat says times have changed and values are becoming more important to businesses.

"Take technology. In the 90s values was less of a focus because everything was moving so fast and companies were too busy reacting to that explosion. Now they have to look at best practice and realise company values that work are the key to a great performance."

THE VALUES THEY VALUE

There are similarities between the values companies choose. For example, the Coca-Cola Amatil value "say what you mean, mean what you say"; correlates to Vodafone and Microsoft's "straight up" and "open and respectful communications."

Coca-Cola

1. One team: one vision

2. Think customer

3. Passion for our brands

4. Valuing and respecting individuals

5. Say what you mean, mean what you say

6. Continuous improvement

Vodafone

1. Supportive

2. Straight-up

3. Simple and clever

4. Fun

5. Zesty

6. Business excellence

7. Unleashed minds

8. Going for it

Microsoft

1. Integrity and honesty

2. Open and respectful communications

3. Passion for customers and technology

4. Willingness to stretch

5. Accountability

6. Be self critical