Organizational values: Helping influence employee decision making

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What are company values?

Company values are short statements that convey the essence of what the company is and how it should behave. There are simple messages that make clear what the firm stands for and what is acceptable.

How can values help organizations?

The primary way that company values are important for organizations is that they illustrate to employees how they should behave. The values may not spell out specifically the action to take any particular situation, but rather, key things to keep in mind across situations. As such, they can help ensure consistency between employees – keeping everyone pulling in the same direction. Faced with a situation where employees do not know how to respond, they can fall back on company values as a guide for what actions to take. 

Characteristics that make company values effective at influencing employee behaviors

Since company values are reference points that employees can refer to when making decisions, effective company values rest on being easy to communicate, understand, and remember. 

Easy to communicate

Keeping company values short and easy to communicate is important. A long list of tens of complicated statements is not effective if no one in the firm has actually read or shared the information. Keeping company values limited to a small number of clear guiding principles can help firms in communicating the values across the organization. 

Simple to understand

Connected to the above, the values should be easy to understand. Everyone should know immediately what to prioritize based on the values. If you are left scratching your head, wondering ‘what does that mean’ on reading values, it likely means that there are tens or hundreds of different interpretations throughout the business – everyone with different takes on how they should be behaving. This negates the key goal of values – to get alignment between individuals. Being clear on what the values are is thus important in getting everyone to behave in a consistent manner. 

Quick to remember

The final element important with company values – that follows directly from easy to communicate and simple to understand values – is that they are quick to remember. Again, values should be a reference point that employees can use when faced with new situations. Being able to quickly recall the values is thus key to actually following through with actions that align with the values.

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