As a senior sales officer charged with effecting business
turnarounds for bankrupt private and pre-IPO companies, I witnessed
firsthand the importance of core values. A strong set of core values
is crucial to driving corporate performance, and without them,
Core values define company culture, which is a big part of why
they�re so important to driving performance. We can represent the
relationship this way:
core values ? company culture ? actions/performance
For any sales team, the primary objective is to predictably and
consistently produce sales, both within budget and in accordance
with our forecasts. Core values, and the company culture they
support, are the most important ingredient in achieving
predictability and consistency in the actions that bring about the
results we want.
Defining Core Values
Core values are simple action statements that express the business
attributes management upholds and believes will lead the company to
success. They are not vague proclamations such as �Do the right
thing� � these can be interpreted at the whim of management
depending on temporary conditions and motives. Core values should be
specific and measurable. First, management should identify the
desired attribute it wants to support; then, the core value can be
determined from that starting point.
If, for example, management wants to emphasize financial
responsibility, it would have core values that address how employees
operate in regard to the finances of the company. Here are some
�Don�t run out of cash, no matter what.� This core value keeps
employees focused on adhering to the expense budget
�Be careful: a little success can create a lot of overhead.� This
core value keeps employees focused on not overly expanding their
departments in good years when there is excess income, putting the
company at risk in slow years. This often results in layoffs, which
are to be avoided.
�Throwing money at a problem doesn�t work.� This core value forces
managers to think carefully through their plans to ensure a positive
outcome within expense budget guidelines. It reminds them that
throwing money at a problem almost never works, since it usually
involves giving more funds to the people who created the problem in
the first place.
If management believes that execution is a key to success, its core
values would emphasize that the company values high performers.
These core values might include the following:
�Surround yourself with only high performers.� This core value keeps
managers focused on excellence in hiring and managing employees.
�Make it a challenge to get on board and difficult to leave.� This
core value defines the way the company hires and manages people. If
management hires only high performers, there will be few openings
due to terminations for underperformance. And if we manage them
well, they will not want to leave the company. The net result is a
dedicated group of high performers.
If management values fairness � something every employee wants �
this core value could apply: �Always do the right thing for
customers, employees, and shareholders, and don�t take a position
that favors one over the other.� This sends a strong message that
one group will not benefit at the expense of another.
For example, the company with this core value will not reduce sales
commissions to shift dollars to management with higher bonuses or
shareholders with higher dividends. This company will not increase
prices to benefit shareholders at the expense of customers. No
single action should be taken to benefit one group at the expense of
Communicating Core Values
Once identified, core values should be published and posted
throughout a company. They can be reviewed in state-of-the-business
meetings with all employees, or in any other suitable venue. When
presenting them, it is important to make an emotional connection
between each core value and all employees. Simply reading them to
the staff or posting them without explanation is not effective.
Just reading the core value �Don�t run out of cash no matter what,�
doesn�t mean much, as most employees cannot envision the company
going bankrupt. Instead, follow the presentation of that core value
by asking the team, �Have you ever known someone who didn�t receive
a paycheck?� You will see hands shoot up all through the audience.
�If so,� you say, �they worked for a company that didn�t have this
Presenting the core value this way makes an emotional connection,
and employees will remember it and be able to internalize it. When
core values are internalized, employees will understand them at a
deep level, which in turn promotes the desired culture. Further, to
ensure employee commitment, each employee should understand that
violation of a core value will result in disciplinary action.
Companies and departments in companies are guided by mission
statements, which should define culture, drive performance, and be
supported by the company�s core values. The mission statements of
departments can be more specific than those of the whole company and
can be used as a blueprint for action.
Here is a mission statement I used in one sales department: �Our
mission is to consistently and predictably support the corporate
sales and profit goals through efficient sales and servicing
efforts, while providing the highest degree of customer
satisfaction.� Once we had the mission defined, we looked to
identify the actions that would ensure its accomplishment. We
identified three guiding principles:
We will obtain for the customer what they want, and we�ll do it
better than any other company.
We will develop and maintain a sales management system that allows
our representatives to maximize selling time while spending the
least amount of time in front of the customer.
We will develop and maintain a business environment for all sales
department personnel that will enhance pride in the company, confirm
the value of long-term relationships, and allow all employees the
opportunity to reach their professional goals better with us than
they could with any other company.
In summary, if we could successfully accomplish these three guiding
principles of establishing a team of high performers, maintaining an
effective sales process, and taking great care of the customer, then
we would achieve our mission statement.
It is important to note that both the mission statement and guiding
principles were supported by the published core values. In this
regard, the published core values defined the culture and actions
needed for success.
There is nothing more important in developing and maintaining
powerful businesses than establishing a winning culture-base on
published core values. People want to work for companies that are
governed by established principles and management that supports
them. Core values are where powerful businesses begin, and smart
management will diligently work to enhance their effectiveness.
John R. Treace has over 30 years experience as a sales executive in
the medical products industry. He spent over 10 years specializing
in the restructuring of sales departments of companies that were
either bankrupt or failing. In 2010 he founded JR Treace &
Associates, a sales management consulting business. Treace is the
author of the new book, �Nuts & Bolts of Sales Management: How to
Build a High-Velocity Sales Organization.�