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Derrick Nielsen
Derrick Nielsen specializes in helping clients manage the conflictual issues inherent in family businesses. He has worked with siblings and cousins to create structures, systems and policies that help them work together effectively as owners and managers. Derrick has assisted companies improve their governance systems through the formulation of strategic and operational plans, the creation of Owners' Charters and Family Constitutions, the facilitation of Family Council meetings and retreats, and the introduction or enhancement of Advisory Boards or legal Boards of Directors. In addition to his client work, Derrick coordinates Legasus Group's research and development efforts. He has shared the Legasus approach to the family business system in a number of public seminars, private workshops and published articles. Derrick's diverse background includes two years on Desmond Tutu's Truth and Reconciliation Commission, a year teaching in a South African high school, and a year tutoring American Politics at Oxford University in England. He has a B.A. from Georgetown University and is currently completing his Ph.D. dissertation for Oxford University. Derrick can be reached at (316) 681-0444 or by e-mail at dnielsen@legasusgroup.com
Business Consulting
2004-08-01 11:51:00
‘Core’ values can be everything
Question:  My wife and I own a successful, local business. For several years I have been thinking about the future of the business - and how it will have to change to survive. At the same time, I believe that we have values and traditions worth carrying on that will continue to make the company successful. What do you think? Are these values I feel so strongly about really important to the future of our business?
ANSWER:  (part two of response, see July ‘04 issue)You will remember that last month I began to answer this question by discussing what core values are and what they are not. It's tempting to dismiss core values as fuzzy, feel-good things that are difficult to deal with at best.  People tend to think that they are too abstract to address effectively.  For a moment, consider this three-step process for introducing core values into your company's strategy.  In fact, if you remember nothing else, remember these three words:  IDENTIFY, SHARE, and ALIGN.  Visionary companies that will continue to succeed long into the future act today to IDENTIFY core values, SHARE them with people both inside and outside of the organization, and ALIGN their personal and organizational activities with them.  We'll go into each of these steps in some detail.Identifying  The first, crucial step is to recognize those core values that exist in your company. Are you thinking you will identify a few creative people in your organization; book a quiet, comfortable off-site room in which they could meet; and then create a nice-sounding, fuzzy-feeling mission statement?  Don't, because you know what that would produce?  A nice statement full of the values that people think they should have, rather than the ones that they actually do have.  Worst of all, if this happens people are justifiably skeptical and cynical about the results.  Studies have proven that visionary companies all have very clear values that guide their operations.  Interestingly, these values all vary considerably between the companies. It appears the content of your company values is not what is most important. Rather, it is how deeply people believe in those values and how consistently they are followed.To help you identify the core values in your business, we emphasize three characteristics:1. Values must be authentic.  They must be real values that are readily apparent in the organization's culture and operations.  Identifying core values is a discovery process, not one of invention or creation.  2. Values must be simple.  Say what you believe clearly, simply and sincerely. No one is inspired or motivated by long statements full of buzz words and consultant-speak.  People respond to values like trust, fairness, integrity and quality.  Long mission and values statements get printed on plaques and hung on walls.  Short mission or value statements that fit on a T-shirt or bumper sticker get remembered -- and therefore acted upon.3. Values should be timeless.  Core values are things that you believe in and will continue to do inside and outside of work.  Quality is a value, not a statement of current strategy or operational tactic. TQM is an operational tactic to ensure that value.  Core values are fundamental beliefs that will not change with current management fads.  They are things that you will continue to do even if the market or the people with whom you deal don't directly reward you for it.  SharingOnce you have identified your authentic, simple and timeless values, share them with employees, customers, suppliers, family members, the community - basically anyone who will listen.  If you have identified truly authentic and timeless values, they can be reinforced continually without fear of overkill or cynicism.  No one wants to read the page-long, boring plaque that's hung in the office daily.  But everyone wants to work for an organization that preaches and practices integrity and quality.  We all want to believe that we are part of something bigger than ourselves.  The sharing of authentic values allows us to do that.There are a number of ways to share core values.  These are but a few examples:1. Develop a mission or vision statement.  2. Find ways to tell your company story.3. Create a company or family "university".  4. Write an ethical will or a legacy letter.  5. Videotape a Legacy Video of your     company's history.AligningUnderstanding the values for which you and your organization stand and then telling other people about them isn't enough.  The final step in the process may be the most important, and difficult part.  You must ensure that your organization's structure, systems and processes are in alignment with and reinforce your core values.  In short, you have to practice what you preach.  Let me tell you a dramatic illustration of practicing what you preach.  In their employee handbook, the Nordstrom company includes a five-by-eight inch card that states:  "Our number one goal is to provide outstanding customer service".  A Nordstrom salesperson once found that a customer had left behind an airline ticket.  From the itinerary, the salesperson realized that the customer must already be on the way to the airport to catch the flight.  First, the employee called the airline and asked them to rewrite the ticket.  When the airline refused, they left their post, jumped in a cab to the airport, and delivered the ticket in person.  Nordstrom later reimbursed the employee for the cab fare.  Now that is customer service! What would an employee in your organization have done?  Would they have taken the ticket to lost and found and called it quits?  Would they have phoned the airline and said that the ticket was waiting at the store?  Would they have delivered the ticket as this person did?  And if they had delivered the ticket, would your organization have rewarded their absence from work?  In the Nordstrom's case, they were living up to the Nordstrom Rules as indicated on the same 5x8 card that is given to all new employees - "Rule #1:  Use your good judgment in all situations.  There will be no additional rules."  That's alignment with core values!  So does Nordstrom really serve customers differently?  Is it different in operation from its competitors?  You bet.  For a start, the company's compensation system rewards its core value of customer service.  The salespeople at Nordstrom, the people directly in contact with customers, generally make almost twice the national average for retail sales clerks.  Nordstrom puts its money where its mouth is. They have done that by making faith and trust in employees the cardinal rule of the company.  You may pick a different value for your company, but you had better align your organization to achieve it just as passionately and effectively as Nordstrom does. In ConclusionI wish I could introduce you to someone I know. About twenty years ago his brother, an equal partner in the business, died unexpectedly. Although my friend could have exercised his right to majority ownership of the company, he instead equalized the ownership to ensure a family partnership for both his and his brother's family - and at a great financial cost. He did this because his family business values preserving the business for a united family to work together. Now that is truly insuring alignment with your core values.
 
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