Leading for Social Responsibility: Do Your Company’s Actions Match Your Values?
Listen to Episode 88:
Episode 88 Transcript:
This episode is brought to you by Business Advancement Incorporated − enabling successful leaders and companies to accelerate to their next level of success. On the web at businessadvance.com. And now, here’s Pam and Scott.
Pam Harper: Thanks, Chris. I’m Pam Harper, Founding Partner and CEO of Business Advancement Incorporated, and right across from me, as always, is my business partner and husband, Scott Harper. Hi, Scott.
Scott Harper: Hi, Pam. Once again, it’s wonderful to join you for another episode of Growth Igniters Radio, and if this is your first time listening, our purpose is to spark new insights, inspiration, and immediately useful ideas for visionary leaders to accelerate themselves − and their companies − to their next level of success and growth.
So Pam, what are we talking about today?
Pam Harper: The growing trend of leading a company for social responsibility, and the transformations of values that go along with that. We recently saw an article in Chief Executive, written by the CEO of BP, John Brown. He discussed the growing trend of CEOs leading the way in incorporating social and environmental issues into the core purpose of the company. Now, this goes beyond traditional social engagement and philanthropy. It becomes an integral part of the company strategy and execution.
Scott Harper: Right; and as you say, this is permeating a wide range of companies. You have BP, where they’re embracing not only environmentally friendly, renewable energy sources in addition to petroleum, they are also promoting diversity in their workforce as a means of engaging, getting greater employee productivity, as we discussed a little bit ago with Jane Howze. Wal-Mart also is doing this in their environmental responsibility initiatives. This trend is also apparent in Unilever, IBM − a lot of the big companies; but it’s not just the big companies. Smaller companies − mid-market companies are also doing this.
In fact, a great example of this is Kind Snacks. We talked a while back about Dan Lubetzky, the CEO of Kind; in his book Do the Kind Thing, he talks about how Kind is not just about selling product, but has embraced and embedded social responsibility in a wide range of ways into their whole corporate culture − their whole corporate ethos − how they do their work. It’s clear that this trend is permeating companies of all sizes.
Pam Harper: In addition, once the leadership decides they’re going to go in this direction, they’re also expecting their suppliers and their strategic partners to have similar types of values in terms of how they conduct business, so-
Scott Harper: That’s right. Take for example Wal-Mart, which has rolled out their environmental conscientiousness requirements not only across their company, but out to their suppliers and partners as well.
Pam Harper: Exactly. While this trend isn’t new, momentum of this movement is dramatically increasing. More people are demanding that companies take stronger responsibility for addressing societal issues. What this article shows is that more CEOs are picking up on the message that their stakeholders are sending, and realizing that doing well by doing good isn’t just a slogan. It really does exist.
This means that more leadership teams are going to be faced with making defining decisions about leading for social responsibility, and how to incorporate this into their companies core purpose and every aspect of how they function.
Scott Harper: A real challenge.
Pam Harper: Yes. Now, another key point that was made in the article is that the focus on social responsibility has to be driven from the CEO. In addition, it needs to be reinforced in a variety of different ways that are perceived as relevant to all stakeholders. In other words, the actions need to match these transforming values.
Scott Harper: And there has to be reinforcement across the entire organization − down through top management to middle management all the way down so that people don’t see it as just, “Blah, blah, blah. We say this, but we expect something else.”
Pam Harper: So a big question is “Where to start?” That’s where written values can help.
Scott Harper: Okay.
Pam Harper: You talked about Dan Lubetzky; he has tenements that represent incorporating social issues into business. He calls it “The Kind Way.” This informs all types of decisions they’ve made over the years, everything from sourcing ingredients in a particular way to making their bars with whole nuts and fruits even though it was more costly and difficult. These are just examples of how written values can translate into something that has concrete top and bottom line ramifications.
Scott Harper: And at their best, these formal written statements of value and how it’s translated into action accelerate decision making. They inform how people do things, how people think about the business because they clarify the guiding principles and the purpose behind what these written values are saying.
Pam Harper: That’s at their best. Now, the challenge is that because the business environment is changing so rapidly, even the most well thought out values can drift. Why would that happen? For example, You’ve got new people; you’ve got, as we’re seeing, changes in societal trends, and needs, and technology.
Scott Harper: Right; technology changes, and new competitive threats and challenges emerge, putting pressure on the company-
Pam Harper: So we’re making me these decisions, “What are we going to do to respond?” It’s very easy to get out of sync with even the best written values. This is beyond a conundrum. It can be something that gradually happens, and others can begin to see the written value and the behavior doesn’t match.
Scott Harper: That is potentially disastrous, because that could engender cynicism. It could engender a tendency for people to say, “Okay, that’s what they say, but we’re going to do it a different way.” That, at it’s worst, can be gradual and practically invisible invisible.
Pam Harper: In fact, more than “could.” I’ve dealt a number of times with situations when it has happened. It’s vital for your stakeholders to perceive that your values are relevant as your company transforms and grows. That’s what this episode is about − how to do it.
We’re going to take a quick break now, and when we come back, we’ll build on this discussion, and talk about how to evaluate the quality of the connection between your company’s stated values and what is actually happening, and how to keep that connection strong. Stay with us.
Scott Harper: You’re listening to Growth Igniters Radio with Pam Harper and Scott Harper, brought to you by Business Advancement Incorporated, on the web at businessadvance.com. We enable successful leaders and their companies to accelerate to their next level of growth and success.
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Pam Harper: Welcome back to Growth Igniters Radio with Pam Harper − that’s me − and Scott Harper. Today, Scott and I are talking about how to keep your company’s values relevant as your business environment changes and your company transforms and grows. I want to add that on the episode page for episode 88 of Growth Igniters Radio there is going to also be an article that we wrote that talks about this. Go to growthigniters.com, and select episode 88.
Scott Harper: Very good. Now, Pam let’s talk a little bit about how leaders can tell if their values really are relevant to their employees, to their customers, and other stakeholders. It really comes down to detecting if there’s a gap that’s starting to form. This is not always easy to find. It’s not always easy to see because we’re in our own system. It’s like that boiling frog metaphor, which is awful.
Pam Harper: Boiling frog?
Scott Harper: Boiling frog metaphor. If you put a frog in hot water it will jump right out. But if you put a frog in cold water and slowly heat it, so the saying goes, the frog won’t notice.
Pam Harper: Ever the scientist.
Scott Harper: What can I say? No frogs were harmed in the making of this episode.
Pam Harper: Thank goodness.
Scott Harper: That’s frog safety.
Pam Harper: Well, I like to think of it as being a detective.
Scott Harper: Okay…
Pam Harper: We’ve talked about detecting; you really literally have to put on the mindset of being a detective, because like you said − you’re in your own system. You can’t necessarily see it easily. If you know some of the guidelines [for detecting values in practice, it can help.] And that’s what I’ve spent time over the years writing about.
Scott Harper: And doing of course.
Pam Harper: Both in my book and doing of course. Let’s talk about a few of them.
Scott Harper: Sure.
Pam Harper: One of the things that I think is so easy to begin to see this, is with some of the written policies and practices and procedures. Now, first of all, if some of this sounds like signs of culture, that’s because values really are the underpinnings of culture.
Scott Harper: Culture is what? − it’s about value, beliefs and practices.
Pam Harper: Value, beliefs and practices, right?
Scott Harper: What people really do.
Pam Harper: Exactly. When we’re talking about values we’re talking about culture. Maybe that makes it easier for some people. Anyway, the written policies and practices and procedures − so for example, are our employees behaving in a way that demonstrates that they see the particular value as relevant? I remember just recently going to Nordstrom, and I had to return a pair of shoes. I went up to the person − I didn’t even have the receipt and then you reminded me that Nordstrom doesn’t expect a receipt.
I tried it − and it was stunning, but the person who was there very quickly − I didn’t know whether he was a manager or he wasn’t a manager − he took the shoes, he said, “Fine. We wouldn’t want you to wear them if they are hurting your feet.” This is an example − yes it’s of customer service, but the fact is that here was an employee that was behaving consistent with that value. [He obviously saw that value as relevant.]
Scott Harper: It was written down, and you saw a consistent behavior.
Unfortunately, we’ve seen counter-examples − companies where sometimes a value was written down, like that printer −”We care” − but the behavior doesn’t mirror that.
Pam Harper: You really have to look at the behavior of the employees. Really not the person − that’s a management issue − but of the employees and the organization as a whole. On the whole, are the policies being upheld? I used to say − when I was working within corporate I’d say, “It’s always time to change the policy when 40% of the time you’re starting to see exceptions to the rule.” That’s probably too high at the end of the day, but if you have to make exceptions to a policy that often, that policy doesn’t mean anything. The policy again, is a reflection of a value.
Scott Harper: Now, that’s one side, where you say what this value that as it’s written down doesn’t reflect what’s really important or happening around here. On the other hand, you alluded to this just a moment ago − if people are not behaving according to the values as the leaders believe and the written down and promote, that’s not necessarily a sign that the value statement has to change, or the policy has to change.
Pam Harper: That’s right.
Scott Harper: It could be a management …
Pam Harper: It could be a management or leadership issue. That’s why you have to look beyond this one thing.
Scott Harper: Sure.
Pam Harper: This is just one example. In fact there are number of examples, and the article I’m talking about presents a few others. Another one to look at is incentives and rewards. For example, who is getting promoted? Is it the person that actually practices diversity and inclusion, or is it the person who doesn’t? People see this kind of habit. Now, if it’s one time again one time is one time although even one time …
Scott Harper: For some things it’s just not acceptable.
Pam Harper: … it is not enough. Right. If you look at, is this person a team player? Is the person known to hoard information resources? When you start seeing this [kind of gap between what is stated and what is done,] you can begin to say, “Why is it happening? Why is it happening?” There are a lot of reasons.
Scott Harper: You don’t really want to change the values to say, “We want loose cannons to go out there and create havoc.” Even though those cannons might be producing a lot of business.
Pam Harper: You’ve got your formal values and then you’ve got what really happens and that was …
Scott Harper: When someone knows they are out of sync what do you do?
Pam Harper: We’re going to talk about that, but I want to talk about one more place to look for gaps between stated values and what is really happening. That would be customs − customs in a company. And again, we think about the customs as elements of culture. Let’s say that you are in a company and you’re the leader − you’ve written down that you value work-life balance. That’s very popular, and it’s a wonderful thing to say and we want to attract and retain talent. Right?
Scott Harper: Of course, right.
Pam Harper: What if your actual experience is that employees are routinely working beyond the official hours, or they are working on weekends − and there are a lot of companies out there that do this.
Scott Harper: Right. And sometimes it’s not because someone is cracking the whip, it’s because they are jazzed, they are engaged. We see this a lot in startups especially, and in mid market companies that are growing like crazy.
Pam Harper: Exactly.
Scott Harper: You’ve got these people who are just spending huge amounts of effort, and yet you’ve got this value statement work-life balance. Someone you might go “Huh?”
Pam Harper: Right, you have to think about how is that [stated value] relevant. Now of course, some people talk about aspirational values versus the core values − “we know that that’s not going on here because that’s an aspirational value.” My feeling is “do or don’t do, there is no try.” Isn’t that from Star Wars?
Scott Harper: Yeah, you’re quoting Yoda from Star Wars. Wow.
Pam Harper: It’s coming out, the movie.
Scott Harper: Episode seven.
Pam Harper: Right. Do or don’t do. There is no try. It’s confusing when you say “these are our values and we aspire to them” when it definitely is not going on.
Scott Harper: Okay.
Pam Harper: I believe for instance that if you’re not there yet you could have a value that’s aspirational by writing it in a way that would say, for instance, “We strive to increase the diversity in our company.”
Scott Harper: Or “We strive to increase work-life balance as much as possible.”
Pam Harper: Ever increasing. Ever increasing.
Scott Harper: Right. When what’s happening isn’t congruent with what the value statements are, people can perceive that the value is not relevant, and unfortunately they can throw everything out. “None of these values are relevant.”
Pam Harper: People can get a little dramatic about it. One of the other things I want to mention is the need to use a variety of sources [for evaluating the match of stated values and real behavior]. I want to emphasis that in terms of using observation, interviews, focus groups, surveys and the like to gain these perceptions, because no one way of getting this information is enough all by itself.
Scott Harper: That’s true.
Pam Harper: I remember going into one company and the CEO had conducted a 360 degree survey before I came in. He got the feedback, and people were saying a lot of things. His response was “these people are whiners.” That was his initial response − because it hurt, because he couldn’t see it.
Scott Harper: It didn’t give answers.
Pam Harper: It didn’t give answers, [so I helped them get more information,] and eventually he was able to come around and see it, and they made amazing strides. but the thing that’s more important here is that although at times it could seem as though people are wrong about the feedback they give, even mistaken perceptions trigger real action.
Scott Harper: That’s true.
Pam Harper: You have to care what people are saying, because chances are [they are acting in line with what they’re saying].
With that, we’re going to take another quick break, and when we come back we’re going to continue our conversation about keeping values relevant as your company transforms and grows − some practical tips. Stay with us.
Scott Harper: Thanks for joining us on Growth Igniters Radio with Pam Harper and Scott Harper. We’re brought to you by Business Advancement Incorporated − on the web at businessadvance.com.
Pam Harper: Can you do us a favor? If you’re enjoying and gaining useful insights from Growth Igniters Radio, can you let us know by writing a short review on iTunes? Now only does this let us know what you value, your review is one of the most important ways we can reach others who will benefit as well. Now, we have a special limited time offer. The first 10 people who submit reviews between September 14th and October 14th, 2016 will receive a complimentary autographed copy of my book: Preventing Strategic Gridlock. Reviewers have said this book is a timeless resource and a great book for overcoming stalls that derail strategic progress, regardless of the economy. To look inside, visit the Preventing Strategic Gridlock page on Amazon.com.
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Pam Harper: Welcome back to Growth Igniters Radio with Pam Harper and Scott Harper. Over the last two segments, Scott and I have been talking about ways to keep those values relevant as your company transforms and grows. Just to remind you − we do have an article that talks more about this on the episode 88 page at www.growthignitersradio.com.
Scott Harper: Very good. Pam, we’ve been talking about the concepts; now let’s get practical. Let’s talk about some immediately actionable steps that our listeners can take to get a feeling for how they can keep gaps between values and behavior in the company from growing and making all their values seem irrelevant.
Pam Harper: Okay. One of the things that we’ve talked about certainly is keeping it real.
Scott Harper: Yes.
Pam Harper: The fact that every value should somehow have a way of being demonstrated. Even if it’s you’re not there ye,t show how you’re continuing to strive, because that is a value of itself. Another way to demonstrate values is frequency of incorporating discussions about values in to real time situations. I know one company that actually includes in their regular meetings a five minute section on their agenda talking about a real-time situation that they have and how they incorporate their values into addressing this.
Scott Harper: That make sense. Essentially, what I hear you saying is that the more that everyone in the company, from the top one down can really articulate what the values look like in action, in behavior − that just like the Nordstrom example, “We value our customers. We won’t hassle our customers when they need something from us. It turned out good in the end.” − The more concrete you can be about what these abstract ideas are, the more people are going to act on them and be consistent and be modeling. It’s absolutely important. “You’ll do as I say not as I do −” It doesn’t work if you’re trying to reinforce values.
Pam Harper: In fact, you bring up a good point. One of my favorite books, that we haven’t talked about yet is the book called Credibility by Kouzes and Posner. In that book, one of the things that they did is that they came up with a stud,y and they found that the most credible leaders were the ones that practice the value of “do what you say you will do.
Scott Harper: Okay.
Pam Harper: Do what you say you will do. Whether it’s aspirational, or whether it’s a core value − that is a sacrosanct value − do what you say you will do.
Scott Harper: The more consistent it is, from leaders on down, the more people go, “I believe in that.” It’s going to inform decisions.
As an example, going back many years now, many people may or may not know that I actually used to work for Johnson and Johnson company. Before I joined them there was that terrible, terrible episode where someone put poison in Tylenol capsules. When I joined the company, although that incident had been 20 years or so before I joined, that was still part of the story of J&J. It was still part of the culture, and people said, “We made that decision; the leaders of that time made that decision based upon the values.” They said, “We have a Creedo in Johnson and Johnson.” It says, “We will protect our customers.” And they pulled every single bottle of Tylenol off the shelves. Nobody said, “What lot?” or anything like that. They pulled them all. That was driven by that value.
Pam Harper: That’s right. What’s important here also here is that you joined them well after that episode, and it it still informed a lot of your own actions and the actions of your colleagues.
Scott Harper: That’s right.
Pam Harper: In decision making. It’s not only in this case a way of governance, it’s also a way of attracting people, because there are something very exciting about a company that lives up to its values.
Scott Harper: When those slip, it can be very damaging to morale.
Pam Harper: People don’t realize it. I mean that takes us full circle; it can creep up on you. Almost nobody intends to ever go away from their values.
Scott Harper: No.
Pam Harper: It can happen for very understandable reasons, and it will happen for very understandable reasons, unless you’re making a consorted effort periodically. That’s my final piece of advice here: you have to come back to this on an ongoing basis. At least a few times a year, look for ways to audit − for lack of a better word − how those stated values are being exemplified in your everyday business, by all the levels − not just employees on the front line, not just leadership, not just middle management − but everybody including the board.
Scott Harper: When that happens, bang.– Relevant values. And they will drive decisions and drive behavior consistently year after year, even as the company is transforming and changing.
Pam Harper: Well said.
Scott Harper: Okay. Thanks for listening to Growth Igniters Radio with Pam Harper and Scott Harper. To check out resources related to today’s conversation, share on social media or find out about up coming episodes or even open a conversation with us, go to, growthignitersradio.com and select episode 88.
Pam Harper: Until next time, this is Pam Harper…
Scott Harper: and Scott Harper…
Pam Harper: Wishing you continued success, and leaving you with this question to think about:
Scott Harper: What will you do, starting today, to find out how relevant your value statements are to employees and other stakeholders?
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