Core Values
The fundamental shared beliefs and guiding principles that define an organization's identity and shape its culture and decision-making.
Also known as: Organizational values, Corporate values, Guiding principles
Category: Leadership & Management
Tags: leadership, organizations, cultures, values, businesses
Explanation
Core values are the essential, enduring tenets of an organization — a small set of guiding principles that require no external justification. They represent the organization's deepest beliefs about how it should operate and what it stands for, regardless of market conditions, competitive pressures, or management trends.
## What Core Values Are (and Aren't)
Jim Collins, in his research for 'Built to Last,' emphasized that core values are **discovered, not invented**. They are not aspirational — they describe what the organization genuinely lives by, not what it wishes it stood for. A company can't have integrity as a core value if it routinely cuts ethical corners.
**Core values are NOT**:
- Marketing slogans designed to impress customers
- Aspirational statements about what the company wishes it were
- Generic platitudes that any company could claim ('excellence,' 'integrity,' 'teamwork' without specificity)
- A long list — Collins suggests 3-5 at most, because if everything is core, nothing is
## Patrick Lencioni's Four Types of Values
Lencioni distinguishes four categories:
1. **Core values**: Deeply ingrained principles that guide all actions; the organization would hold them even if they became a competitive disadvantage
2. **Aspirational values**: Values the company wants to develop but doesn't yet embody
3. **Permission-to-play values**: Minimum behavioral standards expected of any employee (e.g., basic honesty) — necessary but not differentiating
4. **Accidental values**: Values that arise spontaneously without cultivation and may or may not serve the organization
## Why Core Values Matter
- **Decision filter**: When facing difficult choices, values provide a compass
- **Hiring and firing**: Values help attract the right people and identify misfits
- **Cultural foundation**: Values shape the behaviors that define company culture
- **Consistency**: They create predictability in how the organization responds to challenges
- **Trust**: When consistently lived, values build deep trust with employees, customers, and partners
## Making Values Real
Values only matter if they influence behavior. This requires:
- Hiring for values fit, not just skills
- Making values-based decisions even when costly
- Calling out values violations regardless of who commits them
- Embedding values in performance reviews, promotions, and recognition
- Leaders consistently modeling the values
## The Values Test
Collins suggests a simple test: would the organization keep a core value even if the market penalized it for doing so? If the answer is no, it's not truly core.
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