In good times, it is relatively easy to have people on board with decisions. But the rough times are when the true mettle of an organization gets tested. Recession, political upheaval, unexpected influx of competitors, paradigm shifts in society that you couldn’t anticipate, or simply poor judgement on your part—there are any number of factors that can put the brakes on growth and force you to recalibrate. Before you know it, you are faced with tough decisions. Whether you are cutting budgets, adding work hours, or shutting down product lines, how do you ensure that your team rallies behind you to support your decisions? Team alignment becomes extremely critical at such times; but it’s also the hardest time to achieve alignment.
The question then is, how can entrepreneurial leaders generate alignment in the times of tough decisions? Unfortunately, there isn’t an easy tactical solution to this that you can deploy during the tough times. Instead, the answer lies in something far deeper and enduring that decides the very character of your organization—company values. Company values are important not because they sound good, but because they help orient employee perspective and put tough decisions in the right context.
Here are four key aspects of incorporating solid company values on the ground: establishing values early; prioritizing stakeholders; telling vivid stories; and very importantly, challenging values periodically. In this article, I illustrate each point with examples drawn from my own work life at Harbinger Group.
It’s crazy to say you will wait for the startup to grow big and then worry about values. You can’t possibly instill values retrospectively when it is time to take those tough calls. If you anticipate making tough decisions together, you team needs the right values. The earlier you have values in place, the less confused everyone will feel.
I remember a time when Harbinger was a startup with no more than 30 employees. One of our Silicon Valley customers needed a type of service that we had no prior experience with. Granted, we had the capability to build it, but there was hardly any time to learn new skills, and the customer was in a hurry. We faced a hard decision: If we didn’t try, we would miss out on growth, but if we messed up we would lose a customer.
What came in handy was one of Harbinger’s core values – Agility. Our team accepted the challenge with enthusiasm and turned around a proposal literally over a weekend, and moved in to start the project as soon as approval came through. The team put everything into it and made the project a success, eventually winning a lot more business with that customer. Agility predisposed us to embracing this opportunity with speed and flexibility: It is as though were ready to jump together. If agility were to be an afterthought, it would have been too late to build consensus and move fast.
All other factors being equal, who gets the priority: customers, employees, or shareholders? At Harbinger, we practice customer-centricity. We say customers first. We do not say employees first. Nobody even mentions shareholders much. For us, the prime purpose of all our activity is to serve the customer. That reflects in our policies and practices.
So, whether it is about leave approvals or work-from-home requests – they are all subject to customer preferences and project deadlines. Even our work timings are tweaked to overlap customer time zones, our service units are organized around customers, and we seek customers’ input in rewarding employees. And because our employees understand this, they make an extra effort to build strong client relationships.
The priority accorded to customers also helps in getting employee buy-in for hard decisions. Because of Harbinger’s customer-centric delivery model, our processes and cost structures are tuned to satisfy a certain class of customers. Often, there are other customers who might be happy with a lower level of service for a lower price. That poses a hard decision: Saying yes to such deals helps grow revenue by lowering service standards, and saying no to such deals helps us to serve our primary customers better without diluting service standards. When we walk away from low-price deals, sales people support the move, because they understand the implication of customer-centricity: customer satisfaction comes first, rather than sales meeting quota, or company growing revenue.
It is not important whom you prioritize: customers, employees or shareholders. What is important is you set some priority and let that reflect in your values, so everyone knows what guides the decision.
Values, by themselves, are just words. They really come to life only when you see them in action, for instance when you witness or hear stories about your company involving real people. Values sort of make up a script based on which the drama of corporate life unfolds. People don’t read scripts: They watch the drama and even participate in it. That is why it is so important to tell vivid value stories.
I was talking to a group of new joiners recently and explaining to them inclusivity, a value we practice at Harbinger. Some of them were confusing diversity and inclusivity. Someone googled the difference and announced: Diversity is being invited to the party, inclusivity is being asked to dance. The discussion went on for a while.
A hard and somewhat sensitive point to convey is how people should converse with each other in the presence of someone who does not know their language. To say that everyone must only speak English appears draconic to some people in a diverse firm, and hesitating to mandate the use of a common language is to invite the formation of regional cliques, which may go against teamwork.
I was trying to figure out how to state this point. Then, a senior leader asked the group how many people there understood English, but not the local language. A dozen hands went up. He then he asked others: How included do you think these people feel when you chat amongst yourselves in a language they don’t follow? What can you do differently? It was a simple, yet elegant, way of driving home the message. When people understood inclusivity as the senior issue, a consensus about language became easier to build.
Values don’t always need to be set in stone. They can evolve with the organization. One of the best ways to challenge values is to discuss edge cases—situations in which a value is really put to test. I remember the time when meritocracy, a Harbinger value, was put to test. Our promise with meritocracy is simple: if you show performance and commitment, you will move up.
A high-performing individual was up for promotion at Harbinger, but there was one problem. Despite repeated feedback, he was causing damage to the team with his behaviors. By passing derogatory remarks and showing others down, he was affecting team morale. When the time came to discuss the promotion of this person, meritocracy would require that we promote him, yet we could see he was tearing down the team.
The executive team knew that meritocracy could not stand alone. We also needed professionalism, which this person wouldn’t practice despite repeated feedback. That is when he was denied promotion, which caused him to feel upset and he quit. The leadership knows we lost an extraordinary performer, but there were no regrets. We were all united in this decision because the conversation was more about challenging our values, than about promoting that individual.
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If you want your tough decisions, change initiatives, and strategies to have any impact, then you want your teams to be aligned. Company values drive alignment when the ship is turning.
Spelling out company values early, prioritizing stakeholders, bringing values to life through stories, and revisiting them periodically are all great ways to make sure the organization is living and breathing the values. Get your teams to internalize values, and they will support you because they will recognize that your decisions are consistent with those values.
