Great company’s are all values led organizations.  The first step in getting to this state in your company is to have a clear and thorough understanding of what your own individual values are.  You also want to know how you integrate your values into your company.

Today’s guest is Gunther Weil

Gunther is one of the brightest minds I’ve ever run across.  There is no one I’ve ever met who is better on why values are important and how to use them in your organization and family.  Today we’ll cover the following issues and more:

  • Why values are the essence of company’s identity.
  • You might think you know your values, but there are other things you also need to think about.
  • Why if left to your own design, you’ll pick values that you like instead of values you hold dear.
  • Why you want to use a tool that helps you think about your values.
  • How to integrate values into your business and life.

Transcript:

Narrator:         Welcome to the Sustainable Business Radio Show on podcast where you’ll learn not only how to create a sustainable business but you’ll also learn the secrets of creating extraordinary value within your business and your life. The Sustainable Business is all about creating great outcomes.

Here’s your host, certified financial planner, student, entrepreneur and private business expert, Josh Patrick.

Josh:                Good afternoon. I first met Gunther, well, a couple of years ago. He’s among the most interesting people I’ve ever met. He’s a PhD psychologist who’s studied under Carl Rogers. He worked with Abraham Maslow. Besides being an expert on value issues which were going to talk about today, Gunther is also a master NLP practitioner, a master teacher of Qigong, the oriental art of internal energy cultivation, and is a 45-year practitioner of Tai Chi.

Today, we’re going to take a deep dive into the world of values. Gunther’s going to help us understand how we need to start with values as we think about our businesses. Full disclosure requires I let you know that I licensed the Value Mentors Instrument from Gunther and I’ve been trained by him in how to use this with my business and my clients. I do have to tell you that it’s among the most useful things that I do when I first start working with people. I’m sure we’ll be going into that as we talk today. So, let’s get right to it and bring in Gunther and learn more about values and why you need to be paying attention to them in your business.

Hey Gunther, how are you today?

Gunther:          I’m good, Josh. Thank you for the opportunity to share this time with you and your listeners. I appreciate it.

Josh:                The pleasure is mine. Thanks so much for spending some time with us. Why are values so important when it comes to thinking about running a business?

Gunther:          Isn’t that the fundamental question?

Josh:                You might say so.

Gunther:          My sense of it has evolved over a lot of years of work as an organizational consultant and an executive coach, is that values are the essence of a company’s identity. They really illustrate or point to the fundamental principles, beliefs or philosophy that the company embodies. Most firms, whatever stage in their development, focus mostly on technical competencies to establish themselves in the market – usually their products, or their product differentiation, or their market segments or what have you. But many of them, most in fact, tend to forget what are the underlying competencies that make their companies different and run smoothly which I believe are their values. So, in the sense that we’re speaking now, core values are what support the vision and shape the culture and reflect what the company is all about.

Josh:                It seems that almost all people who think about businesses from a global and a macro value all believe that values are really important. Why is it that business owners don’t seem to do much about it? Or at least just give it lip service and not really pay attention to that?

Gunther:          There are a couple of factors. (1) There is a kind of tendency in business—this is true also in family wealth advisory work, for the values conversation to be a conventional conversation that is assumed. So, when people talk about values, people think they know what they’re talking about because values is a term that is so embedded in the culture that people have an apparent understanding that when they’re speaking about values, they’re talking about the same thing. It’s like words like love or God or other words. The subjective meaning of the word is very much a function of the experience of the speaker or listener. There’s a lot more complexity to the word and what it connotes than if it was on the surface. That’s one factor.

Secondly, the values conversation has been co-opted by a lot of different groups that have their own settled ideologies whether it’s religious or political or economic. That word has gotten, as I say, co-opted by self-interest and by different groups.

I think the third factor is that people don’t have an easy way of understanding how they can actually measure their values and apply the results of their measurement to their day-to-day business activities. Well, you know, there are some tools around. For example, that people are given a list of values where they’re asked to select which ones they believe apply to them. Or they’re given a deck of cards and they’re asked to sort them according to value priorities that are printed on the cards.

But, my experience over a lot of years is that those approaches don’t really work very well because people end up really selecting the values they would like to have or the values that are deemed politically correct in the, let’s say, the corporate, or organization, or family that they’re in. They’re not actually talking about the real values or actual values.

I came to this, Josh, a lot of years ago, doing strategy and mission and vision work with C-Suite executives in a lot of different companies from startup companies to Fortune 500 companies. And when you’re doing mission and mission work, you normally spend a half day, sometimes even a full day on values. You’re in a room with a lot of executives with flip charts and you go around, you facilitate a conversation around values. I would walk out of those meeting week after week, month after month, actually year after year with a list of values that really are similar. In fact, they’re too similar to give me comfort that we were talking about the same thing or the real thing. So, that’s why I got interested in discovering if there was a way of actually measuring the actual values of individuals, teams, groups and organizations versus just taking their word for it based on what they aspire to or, as I said a moment ago, what they considered appropriate or politically correct in the environment they were in. So, I think there are a number of factors that could respond—and as I’m responding to your question, why the values conversation doesn’t run very deep. It’s not very compelling or is not more widely adopted.

Josh:                So, you have a system for measuring values – the AVI instrument. What makes your instrument different than the zillions of other ones out there?

Gunther:          Well, there’s a number of factors there. One is, coming back to the story that I mentioned a moment ago about looking for a way or find a way, a methodology. I searched for a bunch of years. I tried out a number of different approaches. I trained in a number of different approaches. None of them met the standards of rigor that I demanded and continue to demand around reliability, around validity, around being real. Again, most of them are based on self selection and valid values. What differentiates the AVI and the work of myself and my colleagues in the Minessence Group and what is now, what we’re calling the International Minessence Cooperative, is that this is a methodology and model and an actual empirical inventory that’s based on assessed values. So, it has a history actually of some empirical validation, both with respect to internal reliability – that is, when you take this thing again or you divided the instrument in half, you’d administer one half to a group and then the other half to the same group. A couple of days later, there’s internal reliability.

There’s also validity which is called phase validity which is, it has an apparent validity with respect to what people report as actually going on in their lives. And it actually has some correlation with other instruments such as and other instruments also that have a reasonable history of empirical validation.

Josh:                In my experience, when I use this instrument, the real value is not just getting the report but having a several-hour conversation with the person who took the report around their values. Every single time I’ve done this, I learned some extraordinary things. Why do you think that happens?

Gunther:          It’s because of your skill, and you’re interest in your client, and the fact that you’re able and willing to use this methodology – the AVI in this case, as a way of actually wanting to go deeper with your client in order to get the result that you’re promising and they expect. I think that a lot of the psychological testing or personality testing or even values testing that’s in the market place are basically ways of quickly getting an assessment. I would say, this is my bias at a relatively superficial level, representing certain typologies. So, you’re placed in certain boxes and those boxes have certain behaviors and certain ways of communicating and so on. The AVI is not like that. It’s basically a tool, a methodology and a model that I consider more like what the Native Americans would call a talking stick. It’s an approach and a methodology that produces a series of reports that demand a deeper dive, that demand that you really go deeper to understand the strengths and weakness of your client, their strategy, their approach, what aspects psychologically that may be undermining or sabotaging them. Any number of range of things that you can only really address and understand if you’re willing to take a deeper dive. So, the answer to your question is – you have to have, first of all, the willingness and desire to do that, the competency to go beyond just a superficial conversation and a deep desire to serve your clients.

Josh:                Well, that sounds pretty logical to me. When values aren’t taken into account, what sort of problems do you see arise in businesses?

Gunther:          Well, that shows up in a lot of different ways. It shows up at the recruitment hiring end, for example, where you may have made choices based on competency. Usually those choices are made purely on competency. You see, you know, you’re doing the normal due diligence with respect to references and curriculum. And even on occasion, you might even have access to future employees 360 that really are employees evaluated for fit for the culture of the organization. And by culture, what I mean here in this instance is, the actual modal values of the organization as they are evolved and developed through the founders, leaders and current senior management team of the organization. Not exclusively those, because you want to look. You know, if you can add a more, I would say nuanced, aspects of the values as they may appear in different departments or divisions of the company.

But for the most part, employees are not—except in the most superficial way, evaluated for cultural fit. So, for example, right now I’m working with an organization in Toronto that was founded by a guy who left Korn Ferry after running Korn Ferry Canada for a lot of years. But he’s actively interested in integrating the values work into his recruitment selection process. A number of his clients are actually buying into that. So, this, to me, is actually—it may not be a first. I think it may well be a first of where we’re actually attempting to address the issue of cultural fit.

And when you’re hiring at a C-suite level, or at a significant salary level, the cost involved with making mistakes are really apparent to any business owner -. anyone who’s been doing this for years. The wrap time, the training time, the severance cost are major factors that really, as I said a moment ago, are not effectively addressed for the most part. Now, I’m just talking about the higher retention aspects of an employee. If you look at other aspects of a company with respect to teamwork and alignment around a shared vision and shared values, as Jim Collins points out so well in different ways, you cannot force people into a set of values that they don’t have. What you can do is you can address the values that they do have and if there are a sufficient number of values that are shared, let’s say, between the boss and a senior team then you have a better possibility of creating more alignment and greater teamwork. But you can’t force people to adopt a set of values that they don’t have.

In the family advisory world, I’m often asked by patriarchs and matriarchs, the question usually takes this form, “How do I instill my values in my children?” And what they really mean by that is, “How do I install my values in my children?” Almost as if they were talking fender on a car or putting in a new set of brake pads. It doesn’t work that way. The children’s values are pretty well established by the time they are teenagers. At least, most of the fundamental foundational values are established. What you have to do as a family member, if you’re in dynastic family or any family business and you’re interested in having the kids maybe participate in the family business, you have to find out if they even want to do that. You have to really work with what’s there and see what the potential is for alignment with what’s already given. You can’t ask people to adopt something that they don’t have or own. It won’t work. It’s never worked, in my experience.

Josh:                I see, a lot of times, that founders and their companies–the founder has a set of values but they haven’t articulated them. And as a result of that, the company is sort of going off in a direction which really isn’t following the path the founder wants to. As a result, the founder surely gets burned out and annoyed and wants to get out. Would it make sense for somebody like this to go through a values process and then try to change the culture that their company exists?

Gunther:          It’s a complex question. I think there are instances where that might be appropriate because it’s partially a function of the lifecycle of an organization. when you’re familiar with that literature and that approach. During the storming phase of an organization, that is the almost purely entrepreneurial startup kind of—we call it storming phase. There’s a lot of fire. There’s a lot of energy, a lot of creativity. This is true to a very large extent in technology companies but it’s not restricted to them, but a founder’s values tend to be very entrepreneurial, highly creative, very individualistic, very high risk tolerance and a number of other skills and value-related skills. At the time the company starts to become more normative, more established where some structures are needed to be put in place, if nothing else then, to preserve the investors’ capital because startup firms have a very high burn rate and they tend to waste a lot of money. I’ve been involved in a lot of scenarios like that. But at that point in the transition of a company to a more normative structure where it becomes more strategic, then often the values of the founder-owner don’t work very well in that environment

And it’s usually the case at the level of the investors, through the board, to make a decision at that point to replace the founder with an individual or a team of seasoned managers whose values are more hierarchical and more organizational, more focused on efficiency, productivity and more on top and bottom line orientation around profitability, often less about relationships and that in the long run doesn’t do them a service either. But that transition is a tricky one. Most founder-entrepreneurs don’t manage that very well and so they end up leaving.

Now, there are instances that I’ve worked with where you have founders who can make that transition. But they have to be willing to learn. They have to be willing to listen. They have to be willing to be mentored by other key people – either outside consultants, or board members, or family, or friends. And for them, it is possible to learn some additional values that can balance their extreme entrepreneurial spirit. The risk there is that if the normative structure becomes too inflexible, they lose interest because their core motivation is fed by their entrepreneurial spirit. So, a key then often is how to re-define, say, the job description of that founder-owner. As the management team comes in with a strong COO, how can the founder function more effectively in that environment, to do what he/she does best while the more normative structures allow the company to scale, and to grow, and to become more profitable.

Josh:                We have time for one more question, Gunther. This is really more around the smaller business or even a family business which is, How important is it for employees of a smaller business to buy into the values of the owner? And how important is it for the owner to effectively articulate those values?

Gunther:          Oh, let me start with the second question first. I think it’s essential that the owner articulate their values. I think without that, people are just in the dark about what are the norms, what are the behaviors, what are the expectations other than the most prosaic pedestrian expectations which is to generate a lot of money and be profitable. And some other things that are kind of just general mom and pop apple pie lip service values.

I think it’s essential that the owner articulate their values but what’s required for that to happen is they have to know what their values are. And again, this goes back to your second question which I expounded on which is that without some way of measuring and evaluating what their actual values are, most people – including owners are in the dark as to what their fundamental motivations are or what may be the conflicts between some of their different fundamental motivations. I see this play out in a lot of different ways with different executives, of different ages, and some significant differences between male and female executives in family and business environments.

So, the other part of my answer, based on the first part of your question is “How important it is for employees to buy into the values” which goes stuff back to what I said a little while ago, Josh, which is – you can only buy into something if you have it. You can’t buy into something you don’t have. At least, you have to share it to some extent.

Now, it may not be—the owner’s value around, for example, teamwork might not have as much potency for an employee but it’s going to have some—there’s got to be some understanding in valuing of teamwork. Otherwise, that employee’s just not a good fit and it won’t happen. So, it won’t be a successful team or company if there isn’t at least a [inaudible 00:17:49] of fit between the founder-owner’s values and senior management team of the company, and those of the employees.

Now, that’s true in picayune family businesses. It’s true on multiple levels of family businesses including the values of the second or even third generation family members that enter the family business which are often quite different from or even at odds with the matriarch or patriarch that started the family business. It’s definitely true at the level of professional managers that are not part of the family. So, I guess, my simple answer to that question is – if you don’t already have that value, at least an aspect of that value, you cannot buy into something that you don’t own or share.

Josh:                Well, that certainly makes sense. Unfortunately, we’re out of time. So, Gunther, if somebody wanted to get in touch with you, how would they go about doing so?

Gunther:          My website is a good source of information on my biography, my client list and what I do – that is www.valuementors.com. I can also be reached via e-mail at my name guntherweil@valuementors.com.

Josh:                Great. Gunther, thanks so much for your time today. I really appreciate your comments about values. And I can tell you from my own experience that companies that don’t pay attention to values, do so at their own risk. So, if you’re a business owner and you’re listening to this, you might want to think about checking out Gunther’s website and learn a little more about his values process. I can tell you from my personal experience, it’s really powerful stuff.

Again, thanks so much. This is the Sustainable Business.

You’ve been listening to the Sustainable Business Podcast where we talk about what you need to do with your business if it was to be here 100 years from now. If you like what you heard and want more information, please contact me at 802‑846‑1264 ext 2 or visit us on our website at www.stage2solution.com or you can send me an e-mail at jpatrick@stage2solution.com.

This is Josh Patrick and thanks for listening. I hope to see you soon for another edition of The Sustainable Business.

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