Hi Leaders,
Welcome to this week's edition of "Culture Correlations." Today, we’re diving into the crucial role that authentic company values play in creating purpose, fostering a sense of 'why' among employees, and driving superior business outcomes.
The Importance of Authentic Company Values
Company values are more than just words on a poster or a page in an employee handbook. When they are authentic and deeply embedded in your company culture, they become the foundation upon which successful, high-performing teams are built.
Creating Purpose and a 'Why'
Employees who understand and resonate with their company's values are more likely to feel a sense of purpose and alignment with their work. This connection is not just about job satisfaction; it’s about employees believing that their contributions matter and are part of something bigger.
Business Outcomes Tied to Authentic Values
- Increased Employee Satisfaction: According to Gallup, companies with highly satisfied employees outperform their peers by 147% in earnings per share.
- Higher Retention Rates: A study by Deloitte found that mission-driven companies have 30% higher levels of innovation and 40% higher levels of retention.
- Enhanced Performance: Research by Bain & Company shows that companies with a strong sense of purpose are 2.5 times more likely to be high performers.
- Better Decision-Making: Values-driven organizations tend to make more ethical and strategic decisions, reducing the risk of costly ethical breaches and improving overall governance.
- Stronger Brand Reputation: A survey by Cone Communications found that 87% of consumers would purchase a product because a company advocated for an issue they cared about.
Real-World Examples
- Netflix: Netflix's culture of "Freedom and Responsibility" empowers employees to make decisions and take risks, fostering an environment of trust and innovation. This culture has driven Netflix to become a global leader in streaming services, with over 230 million subscribers worldwide and consistent revenue growth, reaching $31.6 billion in 2022.
- Airbnb: Airbnb's core values of "Belong Anywhere" and creating a sense of community have been integral to its success. By fostering inclusivity and ensuring all stakeholders feel valued, Airbnb has built a strong, loyal customer base. This focus on culture helped Airbnb achieve a valuation of over $100 billion after its IPO in 2020, reflecting its robust market presence and financial performance.
Actionable Tips for This Week
- Values Audit: Block 20 minutes to review how well your team and company are adhering to the stated values. Discuss specific examples and identify any gaps or areas for improvement. This will help ensure that the values are actively guiding behavior and decision-making.
- Lead by Example: Leaders should embody the company values in their daily actions and decisions.
- Integrate Values into Hiring: Hire individuals who align with your values to strengthen your culture from the ground up.
- Recognize and Reward Alignment: Celebrate and reward employees who exemplify the company values in their work.
- Regularly Reevaluate: Periodically review and refresh your values to ensure they remain relevant and reflective of your company’s mission and goals.
Take Action This Week: Reflect on your company's values. Are they truly authentic and integrated into your daily operations? Make a plan to communicate and reinforce these values within your team to create a stronger sense of purpose and drive better business outcomes.
Stay tuned for more insights next week!
Best regards,
The Instill Team