What does truth have to do with it?
What does truth have to do with it?
An article that explores the value and impact that “truth” and “values” have on creating sustainable high performance.
The number one most important attribute we all seek in personal relationships, or business, is authenticity.
Credibility at the Top?
Many reputations of those in positions of power and influence in government, businesses, and churches, are crumbling fast. Each day, we wince at new disturbing revelations. We are stunned by the audacity and abuses. Yet, it is easy to say that this is a problem that is just at the top — the excesses of the wealth creation era and Internet frenzy of the 90’s.
However, this problem permeates our whole society. Recent studies have indicated that:
- 48% of the workforce has engaged in at least one act of unethical behavior over the last year.
- 75% have witnessed such acts and have not responded.
- 50% of these witnessed acts are deemed to be so severe that if they became publicly known, they would seriously erode the public’s trust in their company.
Today we are witnessing a substantial erosion of public trust, from Senators to Congressmen, CEO’s to Investment Moguls, Telecommunication giants and internet service providers all the way down to the corporate board room there is a landslide of failing trust and an deplorable demonstration of low morals/ethics.
As the dialogue about unethical behavior pervades our public and personal conversations, most tend to reflect upon it as being illegal. However, most would agree that dangerous behavior includes that which lies in the gray area – the little mistruths, misrepresentations, cutting of corners, and the “no one will know if they are not looking” ethical breaches.
According to the most recent Time/CNN Poll, 71% believe that CEO’s are less trustworthy and honest than the average person. But what should keep CEO’s up at night is that their employees are flirting in the grey area each day with the lack of ethical guidelines that influence their decisions. Today, we are seeing that crossing the line can bring companies to their knees. In the case of Arthur Anderson, it was not the actions of the CEO that devastated the company.
Ethics are Modeled
Employees respond to the culture they operate in. Cultures are created by the leadership modeled. Cultures are created by the people who work there — sometimes by the people who came before the people who work there now. Managers at all levels are part of the problem and must become part of the solution. The lack of accountability and consequences for “cutting corners” and generally doing what most would agree is unethical is non-existent at worst, and spotty at best. We tend to believe that “if we got away with it” before and no one said anything, and we benefited from it in some way, then its ok to do it again.
Thus, it is the responsibility of the leadership of any organization to model the behavior they want emulated throughout the organization. “Do as I say, not as I do”, will not provide the results that we want. This is the same principle we see with raising kids. Research has shown that the most impactful influence for a child to develop responsible behavior is for responsible behavior to be modeled for them by their parents or primary care giver. There are no shortcuts here. This is a life principle that applies at home as well as at work.
So, changing the culture of our businesses requires “reprogramming” our managers and leaders. As an organization’s management models new behavior, the workforce will follow. Sounds easy doesn’t it? And the data proves that it is the only way to get sustained great results. However, Jim Collins, the author of “Good to Great” indicates very few of us take this path.
Customer Service Counts
Consider the paradox that we demand to be treated with respect as customers, yet make lackluster efforts to treat our own employees and customers in the same way. What happened to the “Golden Rule”? Do we think these old-fashioned values are not effective or relevant in our technologically advanced, fast paced, new economy?
Research says the traditional value of treating others like we would like to be treated probably applies even more today. Customers are not merely satisfied with their needs being met, but require their needs to be exceeded in order to maintain loyalty. When we exceed expectations, loyalty increases by 6 times. When we just meet expectations, there is no loyalty gain.
And what is the cost of losing customers? Research indicates that, on average, it costs us 5 times more to acquire new customers than retain existing ones, and that we are 8 times more likely to generate new business from existing customers rather than new customers.9
Further, we react more strongly to when we are treated without respect, or not valued, than when we are.
- On average, we will tell 10 others of bad customer experiences we have, and only 4 of the good experiences.
- Experiences that just meet our expectations we are likely to tell no one.
- 71% of all lost customers are due to poor customer service — for not feeling valued.
Employees as Customers
For employees, or internal customers, the statistics are not any better. The number one performance motivator for employees is to feel valued and significant with their work, and yet 70% of those that leave, or quit, are due to the fact they do not feel valued.
When the money is good and when the stock options seem like they have no end, perhaps it is easier to compromise what feels right, and what we believe. Perhaps it is easier to believe that the “old rules” don’t really apply — the new world operates on totally different principles and dynamics.
While it is true that advancements in technology and the complexities of business today require new approaches and strategies from management, I suggest that the best and most effective approaches are still based upon the same core fundamental beliefs and values.
Investing in Truth
So what are we all prepared to invest to stop the erosion of trust in our businesses and society? We need more comprehensive “service plans” for the people who make it possible for us to succeed, rather than just servicing the needs of our physical assets. On the education front, we are doing an admirable job in training the next generation of leadership in the latest principles of business management. However, we are missing the mark in helping them create a foundation in the fundamentals of business performance — having a clear purpose, strong values, ethical standards that govern their actions, effective communication skills, real teamwork skills, and critical thinking skills that lead to improved results for customers, employees, shareholders and their communities.
The sad truth is that this “gap” in education and training is impacting the ranks of our current management, and they are teaching the future leaders by example.
Values are the foundation to the purpose of business. The purpose of business is meeting and exceeding the needs of customers. All employees must understand this truth. If we get that right, we will have sustainable, viable businesses that will be responsible to their employees, their shareholders, and their communities. Isn’t that what we all want anyway?
Creating a High-Performance Culture
The steps to create a high-performance culture are not that difficult, yet the transition can be painfully challenging. The secret for management is to make an unalterable, irrevocable commitment to make the transition a priority and to diligently follow through no matter what resistance they run into along the way. Everyone wins when we make this commitment. Actually, it is not that different in what it takes to change an unacceptable behavior in our kids. Consistently modeling the right behavior creates the right results. In business, the research shows that this approach creates sustainable performance that exceeds the market by multiples. Creating this type of culture is not to be taken lightly. It is a foundational retrofit of our organization. Merely updating the façade through our website and communication efforts won’t cut it. This is about walking the talk.
In our current environment, companies are going to have to work a lot harder to obtain and maintain the trust of employees, shareholders, and customers. The intentional steps to invest in a “culture of truth” are not an option.
The best news is that creating a “culture of truth” is not a compliance issue, it is a strategy for creating sustainable high performance. However, the longer we wait, the more difficult and painful it is to make the change.
Stepping Over the Line
The following are some suggested steps to creating a high-performing “culture of truth” in your organization. Draw a line in the sand for what your organization will stand for, and step over it. Ask others to join you. With courage and commitment, these steps can create a culture of sustained performance:
- Pull together your organization’s senior executives and get clarity on the values and guiding principles that you want to be the foundation of how your organization operates. Make sure these guiding principles are in alignment with the overall purpose and mission of your organization.
- Identify (as many as possible) the ethical dilemmas that routinely face your business.
- Map guidelines for each of the ethical dilemmas to your corporate values or guiding principles.
- Have all senior executives keep journals that record ethical dilemmas faced on a daily basis, the values challenged by each dilemma, and the guideline used to protect the value.
- Use the journals to capture “inspiring stories” that can be woven into your organizations cultural fabric. Continue to track the impact of these stories. Stories that truly impact the bottom line will be the most motivating.
- Meet on a monthly basis to review journals, activity, and new dilemmas and guidelines that emerge.
- Have each senior executive repeat steps 1-6 above with those that report to them, and so on.
- Reward the most inspiring stories in the entire organization on a monthly basis, creating exposure to the challenges and victories that each part of the organization faces, as well as provide updates on the stories that deliver bottom line results.
- Within a short period of time, you will start experiencing a culture that is focused on “valuing” its internal and external customers, and the results that this brings — increased employee loyalty, retention, productivity and innovation, and most importantly, more satisfied customers.
- Publicly document your commitment to a “culture of truth” and the stories that document that you are walking your talk. As I have indicated before, the research shows that customers and shareholders will respond to this, and in fact, are expecting this.