Don’t Forget the Values in Values-Based Leadership

by Tim Green

A research organization in Texas, which studied 16,000 executives, set out to determine which type of leadership gets the best results from workers. The research discovered the following:

  • Executives who took steps showing they care about people, created “excellent results”.
  • Leaders who concentrated primarily on production, created “average results”.
  • Those “obsessed with their own security” produced “the least results”, hence relegating values just to pursue the success of the mission of the company and self.
  • High achievers listened to both workers and superiors.  Low achievers avoided communication, and relied on policy manuals.

The researchers concluded that high achievers are not born, but are made. The key is training young executives to have values-based leadership not policy or profit driven leadership.

Let’s dive in a little deeper….

Many leaders and businesses recognize that a growing dire economic situation puts every business owner and everyone in the market place on tenterhooks.  More importantly, however, is to explore where all this pressure is driving the marketplace.  An ‘ends justifies the means’ approach is simply not working.

Let us not soon forget the Enron downfall, which is a classic case of leadership gone corrupt. Certainly the Enron leadership ignored values and morals, leading to corrupt practices ignored for years.  We all know the rest of the story: financial ruin affecting thousands of people.

For some, the notion that values are outdated, impossible to apply, and not practical for achieving goals has a far-reaching effect.  From the executive to all the employees, a lack of values based leadership can lead to destruction. Consider this scenario from Hitoshi in Japan:

Hitoshi worked in the accounting office of an employment agency in Japan. While reviewing a financial account with his superior, Hitoshi was told to falsify a report. Hitoshi explained that his conscience would not let him do dishonest work. As a result, Hitoshi’s superior threatened to fire him, and he ultimately lost his job.

In the months that followed, Hitoshi became downhearted over his employment prospects. During one job interview, for instance, Hitoshi mentioned that he could not engage in dishonest work. The interviewer responded, “Your way of thinking is strange!” Hitoshi’s family and friends encouraged him to remain firm in his resolve to be honest, yet he began to have some doubts. For instance, he said, “I wondered if being honest about my values was a good idea.” Hitoshi’s experience is a disturbing reminder that not everyone values honesty. In fact, some may even view his values as a liability, particularly in the business community.

Why is this?  Why would we defend the business world’s approach to honesty, for example, when many of the same people rely on it so much in every day life?

As a husband and a father, every man detests treachery and falsehood in his family. Leading a family is one of the basic and important establishment of life and is an important business of life. I believe most people do not tolerate a lack of values in their household. If we would not tolerate this at home, let us not tolerate it in business!

It is as simple as the golden rule. Do unto others what you want others to do to you. It is truly a universally understood concept (not universally applied however).

Finally, a proper understanding of the essence of business was expressed by Adam Smith. He believed that business would work for the greater good of society. As a professor of ethics, Smith believed markets, by their origin, were about morality and doing the right thing.

Values should be embedded in all aspects of business not as an antidote for risk and sanctions, but a means to the end, the vision of the marketplace. If this perspective is applied in all aspects of the marketplace including the executives and management, it will be contagious and a lot of headache will be avoided in averting risk or remediating a business disaster.

It’s clear that leadership not based on values is harmful to a business. However, it is also necessary to keep in mind the importance for everyone in a company to be he held accountable. Many of these economic crashes or meltdowns could have been prevented if the leaders weren’t blindly trusted and given the keys to the kingdom. It’s a two-way street with both leaders and subordinates being held accountable.

Fortifying leadership with values should therefore be done at the onset, at the toddler stage of any business. It should be embedded not as a remedy, but as standard operating procedure. Failure to plan and not having SOP’s in place are triggers for poor leadership.

I am an avid fan and blog reader of marketing expert Seth Godin. He has daily blog posts about business and marketing concepts. Ironically, on Friday September 2 he had an incredible post that gets these points across as well. You can check it out here.


Tim C. Green is a Husband, Dad, Friend and all around fun guy who by day is a principal at 1F16 Productions – a Marketing strategy and execution consultancy group in Columbus Ohio. If you would like to connect with him you can find Tim on LinkedIn.

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