Values: the Missing Link to Understanding Organizational DNA
A recent article in strategy+business highlighted The 10 Principles of Organizational DNA. After assessing over 220,000 online surveys, where individuals described their company’s personality and performance, the consulting firm Strategy& developed an interesting list of precepts.
What’s missing is any reference to the role of values.
- There are only a few organizational personality types. While this study outlines seven common behavioral patterns, I would suggest that every organization is unique. Just as every person is unique (think finger prints and DNA), so is every organization. However, creating a set of differentiating values is the best way to manage any team across any type of organization, whatever the DNA.
- Companies are mosaics of personalities. When companies merge or acquire, the combined culture often ends up being a mish-mash. The more complex the mosaic, the more values can help. Managing by values creates focus and helps everyone prioritize what matters most.
- Weak execution is prevalent. The reasons are endless why companies suddenly experience poor execution. Having clearly defined values is the ultimate instrument to ensure everyone is singing from the same songbook.
- Strong execution is not self-sustaining. Even the best performing companies eventually face challenges. Markets change. New technologies emerge. Competition heats up. Problems can occur inside and out. These are the times that leaders can leverage their values to put the business back on track.
- Performance is based on interdependent factors. The four pairs of building blocks referenced here – decision rights and norms, motivators and commitments, information and mind-sets, and structure and networks – may be interdependent, but relevant values are the glue that makes these work together.
- The org chart isn’t the solution. I agree. Without meaningful values to ground the organization, any type of organizational change is meaningless as the same problems just creep back in.
- Intangibles matter. I agree with this one too. Clearly defined values explain perfectly all of the intangibles that matter.
- Decision rights and information flows deliver. When implemented well, values are the ideal guide to decision-making and determining how information flows.
- Informal factors change when you focus on what works. Similar to #7, values bring the intangible strengths to the surface.
- High performance can’t be isolated. Similar to #2, values connect different groups or functions in the most effective manner.
Bottom line: I applaud the work that Strategy& have put into creating these 10 principles. But to manage a high-performing organization, fix one, or even create one, values cannot be ignored. Differentiating values are the missing link to understand the DNA of any type of organization.
“Differentiation is the brand DNA that reflects the true integrity of the brand. “ – Philip Kolter, Marketing 3.0