Getting your culture right is a complex, dynamic process, but the value it delivers to your employees, customers and other stakeholders is potentially massive.

Legendary management guru Peter Drucker once said that "culture eats strategy for breakfast," meaning that your corporate values and the way your employees behave drive your organizational success at least as much as your business strategy does.

But you may not know how to develop company values. This doesn't mean putting out a piece of paper with some aspirational bullet points, but actually developing within the company a culture aligned with what matters most. Culture isn't what your mission statement says — it's what your people say and do every day.

The Value of Values

What role do company values play in business success, employee engagement and customer satisfaction? As Drucker's quote makes clear, a big one. Values and culture represent "the way we do things around here" at any organization. Culture can guide the way employees respond to challenges and pressures. It's an important part of building smart teams and keeping employees happy and engaged.

How to Develop Company Values: 4 Steps for Success

How should a business owner go about developing a list of core company values — and then ensuring that those values are actually enacted by employees? It's a challenging question, involving a lot of discussion and observation. Here are the steps you should follow to understand, document and reinforce your organizational culture:

  1. Understand your culture through discussions with stakeholders, including the leadership team, employees, customers and suppliers. These discussions must start with simple questions. What are the common attitudes and behaviors observable from your people? What values do these behaviors and attitudes reflect? What values would you like to see better reflected in your employees' actions?
  2. Align your incentives around the cultural values you want. In other words, define your values first. Then, figure out how to match each one with a financial or other incentive. This can help reinforce your stated values. For instance, if you say you value team collaboration but only offer incentives for individual performance, you're not reinforcing your values.
  3. Talk the talk. Be clear about the values that you want to see in employee behaviors and attitudes. Then, live it yourself. Leaders need to set a good example. As a business owner, model your values and recognize employees who do the same.
  4. Audit and adapt your culture. A company's culture often needs to change as it grows. While go-go growth may drive startups to "break things" and cause disruptions, like people, organizations can mellow as they mature. Your culture, as well as your incentives, should reflect the company's lifecycle. Continue to have discussions with your stakeholders about where the organization is going and whether the existing culture is well-suited to take you there.

Getting your culture right is a complex, dynamic process, but the value it delivers to your employees, customers and other stakeholders is potentially massive. Don't overlook this important opportunity to make your business the best it can be.

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