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The backbone of your business
Most advisers, by and large, are enjoying the work they are doing for clients, and their businesses are going ok. The core challenge for most is simply, “How do I get more out of what I’ve got?”
A few weeks ago in an article on business depression I covered the six core areas that businesses must have in good shape. In fact, if you could be 80% good in each of these areas you’d have a fantastic business. Over the next few weeks I’m going to explore each of them in some depth, so you can identify where you are on your journey and what to do to move to the next level.
The six areas are:
Culture (Values)
People
Process
Business Management
Financials
Client Profile
I’m going to start with Culture and Values, because it’s such an important part of your business.
What’s your business culture?
What is culture? I’ve heard it best described as ‘the way we do things around here.’ It’s intangible; you can’t see it or touch it, but you sure know when it’s good or bad.
For me culture and values go hand in hand. If you are the business owner, the values that you hold personally will heavily influence the culture of your business. In fact, they’re so important that values are the very first thing we capture in a business plan with our clients.
Values: the building blocks of culture
Why do values matter and why should you be working more consciously on them? Let’s look at a few reasons:
1. Your company’s values are the building blocks of your culture If your values are the building blocks of your ultimate business culture (and they are) then you really want to choose them carefully and deliberately.
What is your culture like? Do your team take ownership and accountability for the work that they do? Does the customer always come first? Is there healthy and open communication between team members? Or is there a blame culture where no one wants to make a mistake?
Creating the culture you want starts with your five core values.
Even if you’ve not identified your core values and put them down on paper, I’d argue that they are already in place in your business. Capturing them clearly just allows you to share them with the rest of your team. This helps to cement those core values in your business.
2. Values become powerful anchors for your behaviour and your team’s Once you’ve captured your core values, they become the guiding light in decision making.
For example, one firm I work with has, “Treat people as you’d expect to be treated” as one of their core values. When challenging customer service decisions arise it’s often the team that quotes this value back to the business leaders. They’ll say something like, “one of our core values is to treat people as you’d expect to be treated. If that’s truly the case then we should take this course of action.”
The same can be true for strategic decisions at leadership level. If one of your core values is “fun”, then all business decisions will get run through the fun filter. While a decision might appear smart, sensible, or profitable, if it’s not going to be fun it gets rejected.
It’s amazing how a clear set of values simplifies decision making.
3. Your team won’t work well together if they don’t share the company’s values When you are evaluating a problem staff member the very first thing you should look at is if the values fit.
For example, if your five core values are:
Freedom
Excellence
Collaboration
To Inspire
Simplicity
If one staff member is unable to collaborate with the other members of the team that’s a potential problem. If they also churn out work that’s ‘just ok’, rather than excellent (another one of your core values) it’s a major problem.
As a guide, when you are evaluating your team, they should be exhibiting behaviours that are in line with a majority of your core values. The more they match up, the better. Three out of five would be a minimum.
If you do this exercise for your current team, you’ll find that the star performers exhibit a good fit between their values (as shown by their behaviours) and the company’s core values. For the poorer performers the opposite will be true.
If there isn’t a good values fit, the team member should go. It’s as simple as that.
4. Your clients won’t fit well either if they don’t share the company’s values The same issue applies to your clients. Pick one or two of your problem clients and see how you think their values (as shown by their behaviours) match up with your firm’s values.
What you’ll find is that problem clients don’t really see the world the same way you do and it’s never going to work. They need to go too. Regardless of how much money they are paying you.
5. Culture and values have marketing benefits Knowing what you stand for (your values) and living by them, has some pretty handsome payoffs from a marketing point of view.
You can promote your values publicly on your website, verbally in client meetings and in your marketing literature. Doing so allows people that share those values to find you and identify with you. That will help create better fit when new clients do arrive on your doorstep, which improves closing rates.
The same applies to finding and securing new staff members. They too can self select to some degree before turning up for interview, if they know what you stand for.
Values matter
Telling the world what you believe in, and then doing what you say you will do, has currency in the marketplace. One of the things we are all searching for in a world that can seem pretty crazy at times, is authenticity. Not perfection, but authenticity. Are you what you claim to be?
When people can know and trust your culture, they can do more business with you more easily.
So, if culture and values are important, what do you need to work on to get them up to speed?
Step 1 – Identify them Identify your top five core values. What are they and why are they important to you? It’s the story you tell around each value that will reveal its importance.
Step 2 – Capture them in your business plan Capture your core values in writing in your business plan.
Step 3 – Share them repeatedly with your team You can do that by telling stories. Stories about what each value means. Stories of how a value was exhibited by a team member, or even how a value was contradicted and the negative impact it had on the business. All of these stories reinforce what’s important and embeds it into your culture.
Step 4 – Refine them over time Like all other things business related, you’ll get sharper on this over time. Each year when you recreate your business plan, spend some time on refining your core values. As you get clearer, they become more powerful. Your team can have input what the most important values are too. Get them involved if you really want to increase the buy in.
Step 5 – Live up to them It should go without saying that you need to live the values you choose, but I’m saying it here anyway. Sometimes one or two of your five core values will be aspirational and it’s important that as a leader within your business, you step up and be a walking talking example of the values you have captured.
“When it comes to performance standards it’s not what you preach, it’s what you tolerate.” Jocko Willink, Executive Coach and retired Navy Seal
Smart culture = smart business
Take some time to revisit your culture and values. It’s the glue that holds your business together and is a key ingredient in moving to the next level of business success.
Next week I’ll take a look at the ‘people’ issue, another key building block of any great business.
Culture & Values Checklist
Give yourself a score out of ten for each of the following statements. The higher your total score the more clear you company’s values are:
1. All team members know our top 5 core values
2. We tell stories about our core values at all team meetings to reinforce them
3. The owners/directors lead by example on the core values
4. Any breach of core values is dealt with immediately (remedially or terminally)
5. All clients know our top 5 core values
6. Team members are formally reminded of core values regularly (at least quarterly)
7. Clients are formally reminded of our core values (at least annually)
8. We look for positive examples of team members living our values and share them with the rest of the team whenever they occur
9. All new hires are assessed for fit based on our core values
10. If a team member or client doesn’t fit with our core values, we remove them from the business
