Organizations don’t make choices…leaders do.

This is a scary thought. But reading Jim Collins new book “Great By Choice,” this is what he says. And he is right. Here is a snapshot of what he says:

“Organizations do not make choices, their leaders do, and the fate of each of those organizations depends on the quality of the choices its leaders make, especially amidst uncertainty, chaos, and luck…three realities that even the best leaders can only manage rather than control.”

The book goes on to point out that the single most important difference between the 10X companies and those with which they are compared/contrasted is that those who lead them make better choices as they build and then sustain a culture within which everyone else does.

Why is this such a scary thought?  Because our companies will rise and fall with the leaders we select to lead them. And knowing that the average successful hiring rate is about 50%, we are basically saying that we have a 50/50 shot (or less) of the ultimate fate of our company when select the leader (s) to lead them.

So what can you do as the current leader to set your company up in the best possible way?

Three things.

First, build a powerful culture based on your core values. Why? They are the one thing that can never change inside of a company. And if you can hard wire these into your culture, you at least set in motion a group of “invisible” laws that will guide your company’s behavior.

And if you hire by your core values, and hold true to this, then your people will also be guided by these “invisible” rules.

Second, ensure that your leadership group (current and future leaders) are the stewards and the champions of your core values.  We often fall into the trap of hiring leaders because of their vast experience and talent, thinking that they will “save the day.” Do not do this!  Do you really want the fate of your company to be in the hands of someone who doesn’t live and breathe your core values?

And the third thing is for purpose inspired and driven businesses only. If your business stands for something much bigger then your product or service, then your leaders (and most importantly, the CEO) must embody the purpose of your organization.  Too many companies go wrong here. Starbucks did. Apple did. Dell did.

In the words of Daniel Pink, “The risk of losing the purpose motive is one  of greatest risks of high growth companies. ”

You can have the most purpose-based company but, if it’s not led by purpose-based leaders, that purpose can be lost overnight. Period.

As Nurse Next Door evolves into our next phase of hyper growth, selecting the right leaders, who embody our core values and purpose, is one of the most important things that I will have to do.

Finally, in the words of Jim Collins:

“The greatest leaders we’ve studied throughout all our research cared as much about values as victory, as much about purpose as profit. As much about being useful as being successful. Their drive and stamina are ultimately internal, rising from where deep inside.”

If you read my post “Do You Have A Policy ABout Working Naked“, you will know my stance on having lots of policies and procedures inside Nurse Next Door.

But I also recognize that in  a fast growth company, the size we are at, and our goal to grow to become a world class company, we do need some more structure and good corporate governance. (It Takes A While To Get To Utopia (A Policy Less Company)

So our team rolled out a new HR employee manual (I shouldn’t say new – I should say our first “real” one). But it wasn’t called a “Policy & Procedure” manual, it was called our “Play Book.” Why? Because it as a book of guidelines on how we “play” at Nurse Next Door.

But where our team really nailed the roll out of a boring P & P manual? They rolled it out with a bang by implementing a break the rules day, starting with break dress code day. Everybody at Heart Quarters (almost 50 people strong!) had to come to the office wearing whatever they wanted to wear (or not wear). We saw pajamas (including nighties and night gowns), we saw plenty of yoga wear, and we even saw a speedo. Yes, our CFO came to work, and delivered his weekly financial update, in a speedo.

It was fun, egaging, lively, and set the atmosphere to talk a bit about those boring policies that we have to have.

And you know what? We had total buy in to our new “playbook.” People read it. They didn’t roll their eyes when it landed on their desk. The entire process – from the style it was written in, to the branded appearance, to the fun “break the rules day” made it engaging and fun.

Just because you have rules does not mean that you still cant have fun!

“To me, marketing is about values. This is a very complicated world, it’s a very noisy world. And we’re not going to get the chance to get people to remember much about us. No company is. So we have to be really clear on what we want them to know about us.”

— Steve Jobs

to Apple employees, 1997

At Nurse Next Door, we have been highly successful in building a core values driven culture. And although still evolving, I feel confident that our core values, and thus our culture, is here to stay. So now it is time to turn outwards. How do we now take our incredible culture, and communicate it through our brand? How do we use our core values to attract clients, just like we do employees, like bee’s to honey?

That is my next focus, as the Co CEO of our company. And I turn to Steve Jobs in my learning on how to accomplish this.

Steve jobs did a masterful job of this at Apple. He was a master at identifying what was truly important.

How? Because he knew that marketing is about values. He knew that we live in a  very complicated world, and the consumer we are marketing to isn’t going to remember much about us.  And the only way to combat this is  to be crystal clear on what we want them to know about us. He knew that it’s about discovering your own story, being very clear about what you are about and what you stand for, and then communicating it in a simplistic way.

And you wont get this through talking about your features. For Apple, it wasn’t about speed or mega bytes  or comparing themselves to anyone else.

But it was about having  his customers  know who Apple is, what they stand for, and where they fit into the world. He wanted them to know that they were more then just a computer company that made great “boxes”.

Apple’s core value, said Jobs, is this: “We believe people with passion can change the world for the better….and that those people who are crazy enough to think they can change the world, are the ones who actually do.”

So they learned how to communicate this core value. Think back to their advertising campaigns – “1984″ and  “Think Different” come to mind…

This core value, reflected in these ads (and all of its products)  is what Apple is about. This core value  touches the soul of the company.

It is very difficult to be simple. In fact, it is much more difficult to be clear and simple then complicated. But the path to get there?  Be clear and simple about who you are as a company first. This is what your core values do.  When you know your core values, you are able to start to communicate who you are in a more simpler and clear manner to your customers….just like Apple did.

Here is to the crazy ones……..

In Southwest Airlines Rule # 16:  A Culture Has its Own Language, we looked at how great cultures  brand their own language to help bring out their uniqueness.  In Southwest Airlines Rule #15: Invent Your Own Culture and Put a Top Person in Charge of It, we looked at how great companies design their own cultures from the ground up so they become unique. So today we visit Southwest Airlines Rule # 27: See Your Business As a Cause.

“Southwest Airline’s mission is Freedom to move about the country. Before Southwest, only 15 percent of adults in the United States had flown on even one commercial flight. By the end of the century, 85 percent had taken to the skies. A prime reason is the “Southwest Effect”—the phenomenon in which the entrance of Southwest into a market lowers the average fare on other airlines while dramatically increasing the number of Passengers.”

This is purpose. Why we do what we do, beyond just making money. As Jim Collins says, it is the secret ingredient in great companies. When you have purpose, or fight for a cause, it elevates you above the ordinary, and if you can stick to it, then over time, you become a radically different company. Like Apple. Like Starbucks. Like most of the “great” companies in the world.

I recently met Roy Spence, the author of”It’s Not What You Sell, It’s What You Stand For” the founder of The Purpose Institute.  His firm was behind some of Southwest Airlines most successful advertising.  He told me the story of Southwest’s decision to not charge for bags, like every other airline in the business was doing. (See “Bags Fly Free“)

A consultant came in, and told them they would drop $350 million straight to the bottom line by just following suit. Every airline was doing it. It would combat higher gas prices, and help stem the losses that were flowing out of airline companies.

But Southwest said no. We got into the business to give people the freedom to fly, and this goes against everything we stand for. So they didn’t do it.

And then they woke up one day and they realized they had made an extra $1.2 billion by taking away business from the other airlines for making this decision.

This is why Jim Collins calls purpose the secret ingredient in companies. Having a strong core purpose keeps us clear on what our priorities are. It keeps you focused on the important things. And sure, it has nothing to do with making money. But that is the secret. The companies, that stick to their purpose over the long term, actually end up making far more money. Funny, isn’t it?

I often get asked the question: What is the best way to discover my core values? As I stated in my post “The Mission to Mars: 6 Simple Steps to Discover Your Core Values,” I always say the same thing. Do the Mission to Mars exercise. It simple. And it works.

But shouldn’t I go out and solicit everyone’s input when we do this so they all feel that they were a part of things?

No.

Call me hard core, but no. I know, most of the consultants out there will tell you that you should spend time asking all of your employees, what they think your core values should be. But I think that is wrong.

Why?

First of all, this isn’t a feel good, team building exercise. This isn’t an exercise so that everyone feels great about where they work.

Second, not everyone’s input is equal. Call it unfair, but it is true. When we are defining something that will guide the entire organization in terms of your behavior, should you really listen to everyone? Seriously? No way. Not when it is this important. The stakes are way too high.

Third, Are you sure that all of your employees really should be there in the first place? When you have 10,000 employees, you are probably going to have a large number that don’t fit. Should you really ask those people for their input on your core values? No, you shouldn’t.

Discovering and defining your core values is about imposing a set of beliefs on your organization. Imposing is the key word.

So I go back to the Mission to Mars exercise. And if you have a group of leaders that searches for the right people within their organization who should be on that rocket ship (vs just saying each other, like so many do), you will start to get pretty close to your company’s core values.

And that is being true to who you are as an organization. If you want everyone to feel good about it, then start rewarding and recognizing them for living the core values that you impose upon them.

Hard Core? Yes. But that is what it takes to lead and build a core values driven organization.

Core Values  are your identity. They make you unique. Don’t you want to be different? Don’t you want to look, sound, feel and act differently then everyone else in your industry?

Branding experts would say that is what they are for. And they are right. But only partly right. To really create a brand, one that is lived inside, and lived outside….this starts with the culture that we build inside of our companies.  You can have great branding, but it will only be on the surface level if you don’t actually have a culture to match it. The outside appearance will only take you so far.  The moment of truth comes when your customers experience your product or service. Once they experience who you are, will it be a true picture? Does your marketing match who you are? Does it match the product or service your deliver?

In most companies, it doesn’t. Or if it does, it is because the branding is boring and nondescript, and the culture is boring and nondescript. And then you have just a plain, boring company.

This is one way to not only bring your company alive, but also your culture, your purpose and your core values alive. To develop your own language that is unique to you. I like to refer to it as the nice little “package” that we can wrap our culture in.

Southwest airlines is a perfect example. In fact, in my last post, taken from their  “40 Great Lessons Over 40 Years”,  I wrote about Lesson #16 “Create Your Own Language.” For example:

• Their ticker symbol on Wall Street is “LUV”
• Their home field is called “Luv Field”
• They have served “love potions” on their planes for drinks
• Their passengers are called customers

This may seem like blurring the boundaries between branding and core values. But that is the point. There is no boundary. They are one and the same. A “brand” is simply a promise to your customers and employees. So how do you ensure that your employees deliver on that promise, or at least have the passion to do so, day in, day out?  The answer is your culture. If you have a strong culture that is engaged in your company, your brand, you will deliver with passion. And the foundation of your culture? Your core values.  Another example is Starbucks:

• The coffee server is a “barista”
• They renamed small/medium and large to tall. Grande and venti
• They created names for their drinks like a “frappuccino”

At Nurse Next Door, we began to do this when we realized we had a really strong and unique culture, but our brand didn’t match. I mean, we were successful in the marketplace, we had become a national home care brand across Canada, but we kind of looked the same as everyone else. So we asked “how do we start to match our brand with our culture?”  We have this amazing culture, how do we align, match and leverage it into our brand?”

• Heart Quarters vs Corporate
• Care Designer vs Care Manager
• Its about caring, not just health care (our product)
• Caring Consult vs assessment
• Caring guide vs care plan
• Franchise Partner vs Franchisee
• Customer vs patient

Inside Nurse Next Door, people are guided by our core values. Now, by giving them the vocabulary, they talk differently. You know that you are in a unique company when the talk differently. You feel the passion, You feel the uniqueness, you feel the pride. And when someone doesn’t “fit” within your culture, they really stand out. They don’t like it. They don’t adapt. They don’t conform. Like at Nurse Next Door. I know when a nurse doesn’t “fit.”  How do I know? When she keeps the standard, industry name “Care Manager.” When a nurse in our company wont call themselves a “Care Designer”, I know we have a wrong fit.

In Southwest Airlines Lesson #15: Invent your own Culture and put a top person in charge of it, it  talked about the need to be unique. A key component of doing this is creating your own language. So today we visit Lesson # 16: A culture has its own language.  

Here is a snippet from Southwest Airlines:

“Throughout this feature you’ll see some unusual wording, spelling, and capitalization: pilots are Pilots, passengers are Customers, and love is LUV. That’s all part of Southwest’s focus on its internal Culture. These people and that LUV are too important for ordinary spelling. Call it the Southwest dialect. It’s a meaningful thing.” 

If you look at some of the greatest enduring brands on the planet, they have followed the same path as Southwest. Think Starbucks; did we know what a “barista” was, or a “venti” “frappaccino” was before Starbucks arrived? Think Disney; they call their employees “cast members” who show up on the “stage” (their place of work). See my post “Why Disney Kicks Ass at Living Purpose”.

At Nurse Next Door, we also have our own language. Some people think its weird, and that’s OK. The people who think its weird simply don’t fit our culture. (one of the reason why this works in building culture is that it is another “self select” mechanism, where those who don’t “fit” will really stand out)So what does having our own language do for us?It gives us our own identity.

Nurse Next Door isn’t going to sound like, look like, or feel like anyone else in our business. And that is vital if you are trying to build a differentiated brand.

It re enforces our own core purpose, and core values, at every interaction with our company.  When a Nurse Next Door franchise partners need to call head office, they are not calling “corporate”, they are calling Heart Quarters. When our customers call us, they don’t hear “good morning, how can I help you? They hear “good morning, how can I make your life better today”

It re enforces our purpose and our core values for our people, and drives behavior,  on a daily basis. When our people pick up the phone and say “How can I make your life better today” every single time they do it, it becomes more difficult to say “no” to someone, or not do whatever it takes to help them.When our Care Designer’s introduce themselves as Designers vs Managers, the entire scope of their role is different. Their job is to be creative and design care instead of doing the “usual” and “managing” care.

When a customer needs some attention, it isn’t “what customers are upset? It is “what customers need some “luv”?”

It aligns with our brand. A culture and a brand cannot be two separate things. They have to be one in the same. If they are not, then you will not have congruency within your business. And when your customer gets receive their product or their service, and it doesn’t match the “marketing and branding you convey, then the disconnect will be apparent pretty quickly and the brand will suffer.

What we convey on the outside, should be in complete alignment with how we act on the inside. And visa versa. This is how you start to build a powerful brand. Its what Southwest airlines has mastered. And it is what we at Nurse Next Door are trying to do.

I was asked a truly great question the other day. What do core values really do? Why do I need them? Now, my usual reaction to a question like this is to spit out the answer. I mean, I talk about this stuff all  of the time, and I can give a pretty good answer.  But I stopped myself. And I thought about the question. And I replied “let me think about it and get back to you.” So I thought about it. And then I went back to the person. Here is what I said.

1. It makes leading and managing your team A LOT easier. Core Values are a set of clear rules. And when really alive in a company, you don’t need a lot of other rules. You see, so often we create rules for the  few who break them. But they, in turn, penalize the majority who don’t break them. Which doesn’t really make sense.  A clear set of core values eliminate the need for a lot of these dumb rules.  And when your team is living and breathing your core values, they usually do the right thing and make the right choices, making managing and leading easy.

2. It forces you to become better at hiring. Most companies focus on talent when they hire. And this is wrong. You can’t build a great place to work if you don’t hire for skill AND culture fit. By using your core values through your hiring process, you start to weed out the wrong people, and attract the right people. Which is a pivotal tool (the most important tool?) in building a great culture.

It s all about the right people, right?

3. It gives you  your brand identity. How can you differentiate yourself in the marketplace?  We often leave this up to the branding folks. But if you aren’t living your brand on the inside, how do you think you will live up to it on the outside, when a customer buys your product or service? By building your culture around your core values, and the aligning it with your brand, now that is a powerful brand. That is a powerful identity. Why should you be different to your customers then to your people? You shouldn’t. Authentic brands win in the end.

Your culture is your brand. (And your brand is your culture). That is why, at Nurse Next Door, we focus so much on our culture.

4. It makes your company perform better. I wrote a post “Culture Eats Process for Breakfast“. I love this statement. You can have the best processes in the world, but if you don’t have a strong culture to work them, it will only work so well. There is a reason why companies with the best cultures continually outperform companies who don’t. Their people work better. They are more productive.

Give me an awesome “A” player who is dialed into our culture working a bad system  any day over a an awesome system being worked by a mediocre person who isn’t dialed in.

5. It provides a framework for decision making. When your core values are strong, they should be your guide to decision making. After all, they are your moral compass. They should tell you what to do. And what not to do. And if you can clearly communicate WHAT they really mean, then they become a powerful device in empowering your employees (especially your front line employees) to make decisions. After all, that is what we all really want, right? (See point #1)

6. It prevents your company from lurching from crisis to crisis. George Nadaff, founder of Boston Chicken, and my first teacher at MIT, said something that I have always remembered “business equals problems, problems equals business. No business, no problems, no problems, no business.”  The fact is, running a business is all about problem solving. Constantly. And there is always a crisis out there. And what we tend to do when we run and build companies is lurch from crisis to crisis because we don’t have a clear path to follow, or an unwavering commitment to something really big and important.

Core Values keep you on your path (along with the other components of vision: purpose and the painted picture).  They force you to make tough decisions that in the long run, are good for your company.

7. It is the one constant in your company that will never change. And that is good for your people. Think about it. Everything will forever change in your company. Everything is always in a state of flux. But sometimes it is just nice to have things remain the same. It is comforting. Well that one thing is your core values. Your people know that they will remain forever. They wont change. There wont be a new flavour of the month that they have to memorize. Or learn.

8. It helps to address the # 1 problem that companies face. In a recent Verne Harnish Insight, he write that communication is  the #1 problem companies face. Communication is hard. And it becomes increasingly complex as you add people. Core Values won’t solve all of your communication issues, but it sure will a crucial role in improving communication through your company. Why? It provides a framework and a foundation for communication; a framework that all of your people can understand.

9. Your core values are the foundation of your culture. Without them, you cant build a long lasting, sustainable culture. Just like in point #6, when you build your culture around your core values, your culture won’t rise and fall with the times. Do you think you ever hear about those cool companies where they can bring their toys and dogs to work, and get breakfast served to them while at their desk in the tough times? No. Because these perks don’t mean nearly as much when the times are tough (either the company is running out of money or there is a recession – either / or.

The companies that you do hear about? That win the best employer awards year after year, despite facing the same tough conditions? Yup. The ones with a strong foundation of values.

10. It lets people be themselves. It lets your company be itself. Why? Because it is crystal clear WHO you are and WHO you should be at work. It is crystal clear what is acceptable. And crystal clear what is NOT acceptable. And when you let people be themselves at work, they will perform better. And be happier.  

11. It elevates your uniqueness. When you really know yourself, you can let yourself shine through. And you aren’t afraid to show your uniqueness. Think Zappos. Think Southwest Airlines. Two radically unique companies, who let their uniqueness shine all the way through – from their culture to their brand. Why? Because they know exactly who they are. And their people do too. So they magnify their uniqueness.

And this is great for your brand. (And sales).

I just did a speech for another Health Authority’s leadership team.  50+ leaders supporting 6000+ employees, so a fairly large organization.

They started the day with 8 core values. You know, the usual suspects like “integrity”, “respect” “compassion” and so on.  ( See my post “6 Tips on How To Design Your Core Values“) After my speech ended and we got into our Q & A, I got the sense that the group was pretty open (and inspired) to get going on a plan to live their core values. So I suggested we start by “cutting” down their core values to a manageable set, of maybe 4.

Now, this can often be a delicate conversation, especially in a large government based organization, as organizations often spend a lot of money and time and debate creating their lists of core values. But they were up for it. So I ran a few of their core values through my “machete” test.

My machete test is simple. I ask 14 questions for each core value, and in a matter of less then 5 minutes, we can clearly determine if a core value really is a “core” value. It strips away “Get in the game” and “aspirational” values.  It strips away values that are “strategy” vs “core.”  And it cuts out any values that you don’t truly believe in, at least not enough to take action on.

I call it the “machete” test because  I have yet to run into an organization that hasn’t been able to cut down their core values to a reasonable amount in an ultra quick time frame.  (If this was an actual business of mine, I would guarantee that I could do it in 30 minutes)

And in 30 minutes, 50+ leaders had agreed on 3 or 4 core values that they truly believed in and should be a part of their organization. That’s it! 30 minutes! No long consulting arrangements. They didn’t have to do an organizational wide review to determine what values they were really living. It was apparent after we ran them through the machete exercise.

We also started to “rebrand” their current core values(the 4 remaining ones.) You see, it is not good enough to have a nondescript, boring, 1 word core value that is a noun. Why? Because it does not inspire action! It doesn’t tell you what to do! It doesn’t make you unique! And that is what core values do – they make you take action and they make you unique!

And in another 30 minutes, they started to have a completely “refreshed” set of simplified core values. Now they can spend less time trying to design the “right” set of core values, and more time trying to live them. All in a few hours. Pretty cool.

Earlier this year, Southwest Airlines came out with their “40 Lessons To Learn” on their 40th anniversary.  Southwest is famous for their culture, and their leaders attribute their unmatched success in the airline industry to this. As you can guess, there were a number of lessons on the importance of culture.

Here is Lesson # 15: Invent your own Culture and put a top person in charge of it.

“The person behind Southwest’s unique culture is Colleen Barrett, the airline’s former president. A native of tiny Bellows Falls, Vermont, and a graduate of Becker Junior College, Colleen (no one calls her “Ms. Barrett” and gets away with it) was Herb Kelleher’s legal secretary when Southwest got its start. She started as the corporate secretary in 1978, rose to VP of administration in 1986, and became president and chief operating officer in 2001. By the time she stepped down in 2008, she had crafted the tone and SPIRIT that defines Southwest today, from the legendary annual Halloween party to the way a gate agent treats a Customer.

Sporting a long white ponytail, she looks more like a sweet grandmother (actually, she is a grandmother) than a corporate titan. But anyone who acted against the Southwest way of doing business—who, in other words, behaved in a way that seemed less than heartfelt—were immediately set right.

Heartfelt. If one word defined Colleen and the Culture she worked to create, that’s it. We love that Forbes rated her above Queen Elizabeth II in its 100 Most Powerful Women ranking in 2005. She didn’t make No. 1., but only because Forbes doesn’t grade people by the size of their hearts.”

Point # 1: Invent your own culture.

Southwest is unique. There is no airline like them. There is no company like them. They stand in a class of their own. Why? They had leaders like Herb Keller (founder) and Colleen Barret who recognized that one of their main jobs as a leader was to  build and lead a company that never strayed from their purpose and always stuck to their values. So they designed Southwest airlines around these principles. And by doing so, became a unique company.

So many companies are the same. They share the same, boring, old core values. They have a mission statement that is a paragraph that no one (even the founder and CEO) can communicate. And most of all, even if their values aren’t old and boring, they don’t know how to live them. So they never form a unique identity with their culture. And they never form a unique identity in the marketplace, either.

Point # 2: Put a top person in charge of it

How many examples of great brands can we name that started to fail once the founding CEO left the CEO position? Lots. Apple, Dell and Starbucks are the first 3 that come to mind. Why? Because the spirit of the company also left with the founding CEO. Sure they hired super smart people. But super smart people don’t always have the heart and the spirit that the founder embodies. And when this disappears, so can your culture. When the company’s purpose isn’t truly embodied (read blog post “Making Tough Decvisions to Preserve Your Core: Learning From Starbucks), that is when your brand will start to falter.

Southwest did it right. They hired someone from within that embodied the spirit of the company. Colleen certainly wasn’t the smartest CEO out there. But she was someone who would champion the cause.  Apple learned the hard way. This time, they promoted from within. I bet after Howard Schultz turns Starbucks around, that he will appoint someone from within as the CEO.

 Even if you cant do this, (as with most fast growth, entrepreneurial companies like Nurse Next Door) you better make sure that your person at the top embodies the spirit of your company, and they champion the cause.