What are value-driven businesses?
Value-driven businesses are those that achieve success by focusing on the triple bottom line. These companies deliver extraordinary value for customers, investors, and the global environment, society and economy. Consequently, these companies and the value-driven leaders that direct these organizations produce exceptional business results by providing moral leadership and promoting the social good by way of sustainable and ethical business practices. Values-driven businesses recognize the quantifiable and unqualified connection between corporate citizenship and stewardship of the global economy, environment and society and competitive advantage, profitability and shareholder value. Value-driven companies successfully bridge the gap between the social good and shareholder value. As a result, these businesses regularly outpace their industry competition by strengthening their competitive advantage and creating lasting shareholder value while also maintaining the social, economic and environmental good by producing value for stakeholders, i.e. customers, investors, employees and global society.
Value-driven businesses are able to sustain success even when their industry competitors are facing innovative, economic and organizational challenges as a result of economic downturns. Value-driven organizations appreciate the importance of and respect their employee’s contributions to the business. Consequently, businesses that flourish despite tough economies are those companies that adopt a value-driven and ethical business model that effectively balances shareholder value with the social good. Why do value-driven companies thrive when their industry peers falter? Value-driven enterprises promote, build on and display a value-based durable organizational culture that endures in spite of rough economic times.
The growth of a value-driven business
Richard Barrett, author, globally recognized thought leader on culture, values and leadership and founder of the Barrett Values Centre defines a value-driven culture as “using values to drive decision-making so that you consciously create the future you want to experience.” “Cultural resilience” or the ability of businesses to be buoyant in light of difficult business conditions and turbulent economies does not happen overnight but rather, is a process of determining the fundamental values on which organizations were founded and maybe more importantly, the development of values that will move businesses toward their envisioned future. Culturally resilient businesses exhibit a commitment to the social good, an extraordinary amount of staff contribution and engagement, a common set of principles and a collective vision of the company’s future. The vision for a value-driven business model and culture is the brainchild of an organization’s leadership but it must be bought into by company employees to be wholly integrated into the fabric of the business model, core business strategies and envisioned futures of businesses that follow value-driven strategies. Putting in place a value-driven business model and parallel culture is a course of action that over the long-term will achieve competitive advantage and profitability, which is in the interests of shareholders and stakeholders alike. Effectively balancing shareholder and stakeholder value is a byproduct of cultural resilience in the face of challenging business climates and value-driven leadership. It is also what differentiates value-driven organizations from their less profitable and competitive industry counterparts that do not subscribe to a value-driven philosophy.
The servant or value-driven leader
Notwithstanding the job description of Chief Executive and Operating Officers in today’s global business markets that is still the protection of shareholder value, competitive advantage and profitability, business leaders today embody or should personify value-driven, ethical and sustainable leadership that envision business models that serve both the interests of the collective good and the organization---value-driven leadership, the new paradigm. Once thought of as radical and incompatible with the protection of shareholder value, value-driven leadership and corresponding business models are no longer the exception but becoming the norm in the current global business environment. The very tangible, quantifiable and unequivocal relationship between profits, competitive advantage and shareholder value and corporate social responsibility and value-driven behaviors are no longer irreconcilable but instead thought of by foreword thinking leaders as complementary and even necessary to a company’s success. The words of an unknown sixth-century Chinese philosopher “A leader is best when people hardly know he exists, Not so good when people obey and acclaim him, Worse when they despise him, But of a good leader who talks little, When his work is done, His aims fulfilled, They will say We did it ourselves” could be the mantra of today’s value-driven leader. Leadership is more than company profits and shareholder value. It’s also about helping others to be innovative and inventive, getting things accomplished and if necessary, changing the status quo. Value-driven leaders turn organizational charts upside down. They are first assistants to their employees and the leader’s role, quite simply, is to find better ways to lead by helping, teaching, and listening to their employees and helping them realize their full potential to become change agents and leaders in their own right. Value-driven leadership is leadership by engagement and example. At the heart of value-driven leadership and a focus of value-based leaders is servant leadership.
Value-driven leaders lead by example and have a sustained ability to energize, engage and influence other people. They find positive ways to engage employees and awaken their “sleeping” commitments to organizational objectives and vision. It’s vital for these leaders to connect with others to sell their vision for the organization. The qualities of a value-driven leader are well-matched to take on the challenges of a dynamic and ever-changing business environment. These leaders feel comfortable in situational leadership situations, which is important in universal business markets. Value-based leadership is empathetic, honest, and sensitive to diverse points of view of others. Value-driven leaders show compassion and respect, listen attentively, elicit concerns and calm fears, answer questions honestly, and engage employees at all levels in the organization’s decision-making process. Value-driven leaders do not lead by egos or control but rather, motivate others and challenge employees to be imaginative in their thought processes. Value-based leaders are authentic, more approachable and not afraid to be seen as vulnerable. These leaders also welcome the experience and knowledge of others and appreciate candor, and the outlook of others in the organization. Value-driven leadership is about creating a culture of resilient leadership and crystallizing this leadership-centered philosophy by empowering employees and tapping into their creative and collective brilliance to find adaptive solutions to challenging business environments. The authenticity and vulnerability value-driven leaders display builds credibility and legitimacy in and outside of the organization. These leadership qualities foster cultural resilience, develop consensus, collaboration and cohesion within organizations, align values and envisioned futures of both leadership and staff, and ensure that everyone in the organization is engaged in and committed to the organizational objectives, mission and envisioned future of the organization.
Making the business case for value-driven organizations and leadership
In the long run value-driven organizations and parallel leadership achieve superior performance and profitability via greater rates of production, higher cost-savings, better customer service levels, and support of sustainable business policies and practices that value-driven leaders believe are necessary for sustaining business growth and competitive advantage. Value-driven enterprises also see higher rates of employment satisfaction and retention as engagement of all employees drives innovation and productivity. Engaged employees who feel appreciated for their input and believe they have a personal stake in the success of the organization are typically more productive and revel in their work. Consequently, businesses see cost-savings in lower absenteeism and employee turnover while achieving greater production and innovation, which is crucial for business growth. Converting intangible values such as concern for the social good into tangible results such as competitive advantage and higher profits is a key signal that value-driven leadership and its corresponding culture are working to ensure positive outcomes for consumers, shareholders and employees alike.