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The third tentpole of a compelling Point of View are your firm’s values.
Values, when clearly articulated and lived out, inform dozens of decisions around what you do and don’t do as a firm. They become a useful litmus test when making hiring decisions, or when deciding whether to chase a potential client. They’re critical for evaluating culture fit when contemplating acquisitions. They become part of your organization’s DNA.
Why clearly define your values?
Values differentiate your company in the minds of your team and your customer.
There is a high degree of overlap between your values and your firm’s brand. As we’ve discussed elsewhere, your brand is the way you make customers “feel” - the sum of all the interactions clients and team members have with your firm, and the feelings those interactions trigger. Values consistently lived out represent one of the key ways you shape those interactions.
Seth Godin provides a super useful shorthand when doing positioning exercises. He suggests starting with the statement, “people like us do things like this.” And define what “this” is. The this is not the product you sell or service you provide. But it is how you go about doing it, and why. It is effectively your values.
Most firms can’t answer this question. But the strongest brands in the world do. Harley Davidson was famous for saying, “We sell the ability for a lawyer or accountant to walk into a bar and have people be afraid of them.”
Values help you filter candidates.
Strong, well-defined values become an incredibly effective filter for vetting potential team members. In most firms we’ve found you can teach many of the skills necessary to do a job well. It’s much harder to teach or instill the appropriate values.
In fact, we recommend hiring processes start with a values screen. This lets us avoid wasting time interviewing candidates that might have the right work experience but lack values alignment. In many cases, team members who are capable but have different values will create more problems for the firm than they are worth.
Values help you make strategic decisions.
Values can be a useful litmus test when attempting to make important decisions. Partnering with other firms, making acquisitions, deciding on customer segments to expand into can all be examined through the lends of values. Even service offering and pricing decisions can be examined through this filter. If craftsmanship is a core value, it’s unlikely you will have the cheapest service.
Why Values Don’t Stick
The problem with most firms is not that they don’t have values. At some point they likely attempted to create values. And yet they find that they don’t stick. If you ask 10 people in their firm, there’s a good chance they don’t even remember them. Why is that?
We believe this is because most value exercises make three key mistakes.
Mistake #1: Vanilla values
The first mistake is to round off the edges that make them compelling. This is often because values exercises are done in a committee, and it’s hard to get alignment on values with different stakeholders. It also feels like a risk - choosing values with some teeth in them will turn some people off.
But as a result, they neuter the impact of the values. No one remembers them. Vanilla values that are interchangeable with any other firm might not repel anyone, but they don’t attract anyone either.
The most common symptom is choosing values that are simply table stakes. It’s common to see values like “integrity.” EVERY firm should have integrity. That isn’t a differentiator. That isn’t a rallying cry.
Values should be strong. They should stop people in their tracks. The words should be like a sledgehammer, communicated in a tone of voice consistent with your firm's brand. They should have an opinion about the world.
When you’re thinking about your values, instead of rounding off the edges considering going to the extreme.
You don’t value “customer service”. You are obsessed with “customer delight.”
You don’t value “quality”. You value “flawless execution.”
You don’t value “friendliness”. You value “joy”.
You don’t value “efficiency”. You value “getting 1% better every day.”
You don’t value “customer relationships.” You “hug your customers.”
Mistake #2: Not making them concrete.
Values ultimately are reflected in our actions. Our actions are always consistent with our values. We have a word for people who say they believe something but act in a way that is inconsistent with that belief - we call them hypocrites.
In order for your team to live the values out consistently, we’ve found it’s incredibly helpful to stake in concrete terms the implications. What are the things you do as a firm because you have these values? What are the things you don’t do because you have these values?
These can be big things like criteria for working with clients or pursuing partnerships. But most of them are small things, like the way you answer the phone or conduct meetings or present yourself.
It’s okay if you don’t have a ton of them to start with - consider this a living document that evolves over time. As you see examples of this in your firm, add them to the document. As you see examples in the outside world that demonstrate a value, add it to the document. Make it concrete for your team, make it inspiring for your team.
Mistake #3: Not taking them seriously when hiring.
We already mentioned how we like to use values as the initial screen when evaluating talent. This is because ultimately the firm doesn’t have values. The people within the firm have values.
And it’s the values of those people, lived out in the actions they take and the interactions they have with clients and each other, that represent the manifestation of the “firm values.”
A firm’s values are not what’s written on a slide deck or put on a plaque on the wall. They are the sum of the actions of the sum of he people inside of the firm.
It is incredibly difficult for someone who doesn’t share those values themselves to actually live them out consistently. When things get hard, who you naturally are comes out.
That’s why it’s so important to use values as a filtering criteria when hiring. You don’t come up with values, announce them to a company, and expect a bunch of people who might not share those values to suddenly live them out. They either have those values or they don’t. While they can learn them, it can be very difficult, and it takes time. Skills can be acquired much faster than values can.
Rolling values out in the firm
It starts with you as the leader
The most important people in making sure values stick are the leaders within the firm. Values have to be modeled from the top down. In fact, I would argue this is always what happens - it’s just often unintentional.
Many partners often discover too late that their firms are effectively manifestations of who they are as people. If the firm is disorganized it’s because they’re disorganized. If their firm is cruel, it’s because they are cruel. If the firm loves people, it’s because they love people.
The firm inherits what makes them great, but also what makes them awful. They often don’t realize it for years. But their team sees it.
If your firm is going to become like you, you might as well do it intentionally.
Bake the behaviors you identified that model the values into your daily routine. If you have a morning or evening self-management process, add a reminder to try and embody a value into your priority tasks or meetings for that day. Reflect on the previous day and ask yourself how well you lived up to your values.
It’s okay if you mess up - everyone does. But you need to be the one modeling these values more than anyone else if you expect them to stick.
As much as possible you want to be proactive rather than reactive. You want to “lead” the team rather than “managing”.
Assess your team
For each team member, ask them to assess themselves according to each value. Three options:
- I embody this value all the time.
- I embody this value sometimes.
- I don’t embody this value.
You are going to do the same thing based on how well you think they model those values. If a team member says (or you say) that they don’t embody one of the values, create a goal for them to start practicing that in the next quarter.
If they don’t embody any of them? You will probably want to counsel them out of the firm. People who don’t embody your values will create friction and stress for you and the rest of the team. This doesn’t mean they are bad people - simply that the things they value aren’t the same as yours. If you chose values that are strong and opinionated, this is likely.
Note also that this should happen over a period of time. If a third of your firm needs to be replaced, that isn’t a band-aid you rip off immediately. It will take time to hire and replace those folks, and you want to give them a gentle off-ramp to their next role.
Create a cadence of accountability
It takes time for new habits to get ingrained, even in people who really want to change. While it’s possible to try and rely on them to create those triggers themselves, it’s much easier and effective to bake those triggers into a communication cadence for them. This can manifest itself in a number of ways:
- Creating a weekly automated email or post in your group chat platform (Slack, Teams, etc) asking them to reflect on ways they’ve embodied the values this week. The simple act of reminding them weekly will likely have an impact. But bonus points if you encourage them to actually reply to these messages, because this gives you examples you can fold into your values document.
- In your all hands meetings, take 5 minutes to remind everyone what the values are, and to call out examples that you saw (or were submitted to you) of team members embodying them.
- Create an annual training where you do a deep dive into your values.
- Add the values to your review process and make it a part of compensation and promotion decisions.
Embed values into your hiring process.
As we mentioned earlier, it’s much easier to train for skills than for values. We recommend making values alignment the priority of the first phase of your hiring process.
This can be tricky. If you ask someone point blank if they resonate with a value they’ll say yes. They’re looking for a job, and they probably are coming from firms that paid lip service to their values but didn’t actually manage to them.
The best way we’ve found to do this is to ask people value pair questions. Have someone choose between two sets of values - yours and an opposite or different value.
It’s critical that the opposite in each pair is also a positive value. You don’t want to signal that one is better than the other (again, it probably isn’t - it’s just different than yours). But force them to choose between two values and you’re likely to get a much clearer picture of the person.
We’ve seen people try to embed little tests into the subsequent stages of the hiring process as well to see if they actually model them without thinking about them. For example if a value is cleanliness or conscientiousness, the interviewer could “accidentally” drop a piece of garbage behind them as they’re leaving the interview room and see if the candidate picks it up or not. If promptness or urgency is a value, you can send a follow up note and see how long it takes them to reply.
The Power of Values
Your values, consciously chosen and consistently lived out, can be a tremendous source of power and energy in your firm.
They tell the world what you stand for. They attract better talent. They attract your ideal clients, those clients are more inclined to stick around, and more inclined to tell others about you. And they help you create a firm you’re proud of.