Why Company Values Are Important for SMEs
While every UK company jumped on the bandwagon of putting out a “Mission Statement”, most failed to follow up to connect ideals with actions. In terms of company values for small businesses, business reputation is even more important because even a small setback could be catastrophic for survival.
Let’s look at the ways that values matter with business.
Why Is Defining Company Values Important?
Think of company values as a set of immutable laws that must be followed. Without both the founder and the employees understanding what these values are and why they’re important, decisions are made that would otherwise violate these rules.
For instance, one example is lying to a potential customer to get a deal that may come back to haunt the company later when the lie is discovered. The salesperson might want to use any means necessary to bulk up their commissions, but it’s not in the best interests of their customers or the long-term potential of the company. With a company value that clearly states that we strive for honesty in all our dealings, both with employees, customers, potential customers and third parties, then it would be clear that the salesperson’s action would violate this ideal and be cause for disciplinary action.
Tying Negative Consequences to a Violation of Company Values
Without making people accountable for actions that don’t meet the company’s values, employees are free to violate them at will because nothing bad with happen to them. While we all want to believe that everyone is good and no one will bend (or break) the rules, people ultimately work for their own benefit. Similar to the idea of “trust, but verify”, it’s a good idea to back up values with consequences to show that the company is serious about them. On the flipside, employees who exemplify good company values should be praised.
Make Sure That Your Financial Dealings Are Value-Driven Too
Businesses that are operated without a solid plan are likely to fail. Similarly, ones that lack a solid financial foundation or enough working capital to operate as an ongoing concern run the risk of crossing ethical boundaries in their struggle for survival.
Finding a quality business lender like Merchant Money is important because when they believe in your mission and want to support it, you have a solid basis to push the business to the next level. Without a good financial plan, everything else is for naught.
Consider Values When Making Important Business Decisions
While it’s true that sometimes it’s sufficient to use your gut feeling about whether a deal point makes sense, it’s good to review important company decisions from a value standpoint first. It allows you to take a step back from in-the-moment decision-making to look and see whether the values are being upheld, or not. Doing so can catch bad decisions that otherwise might have gone unnoticed until it was too late to do anything about them; then you’re just dealing with the fallout.
Getting the values right is as important as the company culture because it helps shape the thinking and actions of everyone involved with the business. Without this kind of framework, decisions are made haphazardly that aren’t subject to any kind of scrutiny which is a recipe for disaster.