Vision and Values

Alignment of a company’s vision and values with its strategies, policies and management controls is the foundation of high performance. Organizations without this alignment will create friction between management’s desires and the actions of employees and, there-by, inefficiency.

Think of vision as the statement of what you aspire for your company to be, and values as the yardstick for its behavior. Now think of strategies, policies and management controls as causing the daily decisions and actions of your employees. Based on these definitions, you can see what might happen to your company when there is not alignment versus when there is.

Let’s look at a mobility company that had been in business for more than two decades, but whose vision and values were not aligned.

The company’s vision was to find solutions to mobility issues for people in its market. Its values statement focused on teamwork, sympathy, understanding and respect in employee relationships. The company was accredited, and the accreditation had been renewed once.

But sales had declined for three consecutive years by a total of 25 percent. In the meantime, the market had grown 18 percent, so there had also been significant loss of market share. The income statement reported losses in three of the five previous years. The owners were loaning money to the company and not taking salaries.

Management also pointed out that: different people processed orders in different ways; customer opinion was that the company did not deliver what it promised; service techs were wasteful with tools and parts; and the company had just disposed of two 45-foot trailer-loads of stale inventory. Financial analysis showed the company still had about nine months’ inventory.

These results could have been blamed on bad marketing, employee turnover, insufficient management information, excessive overhead, jealousy over who gets paid what and what they contribute, and increased competition. Each condition would have been correct.

But the root cause of this company’s distress was lack of alignment on two levels. First, the company’s vision and values were not pointed in the same direction. The vision was customer-focused, and the values were focused on employee relations. How could they deliver solutions to mobility issues when they most valued good employee relations? Both the company’s vision and its values should have been customer-focused.

The second level of failed alignment was among strategies, policies and management controls. Strategies must support vision and values, while policies should support strategies, and management controls should support policies. In this mobility company’s case, there were no strategies. Management and employees showed up for work and reacted to the issues of the day.

The company did have policies, but they were designed to support an accrediting body, not to support strategies.

Finally, management had no controls to let them know whether their policies were being followed or if they were failing customers. This manifested itself in the company’s sales decline, unprofitable operation and customer opinions.

The long-term fix for this company came not by improving its bad conditions but by creating alignment of its vision, values, strategies, policies and management controls.

Alignment started with involving all employees in the rethinking of vision and values. Strategies were developed to uncover more opportunities to find solutions for customers. Policies and procedures were modified to support the new strategies. Management controls like budgets, timeliness of service reports, accounting software and communication systems were added to alert management of failures to support the vision and values.

The results were immediate, and after three years, the company had more than doubled its sales without geographic or product line expansion. Cash flow permitted the owners to be repaid for their loans to the company, which had been profitable in each of the three years. Customer satisfaction also had turned around, with 99 percent of the company’s surveys being excellent.

Wallace Weeks is founder and president of Weeks Group Inc., a Melbourne, Fla.-based strategy consulting firm. He can be reached at 321/752-4514 or by e-mail at [email protected].