How to write Company Values
Earlier this week I sat down with a portfolio founder to discuss performance issues within his team, specifically speed and execution against deadlines. He had noticed that over the past few months things have started to more consistently slip and excuses were becoming a common occurrence. This was a team-wide observation, not an isolated employee. To me this sounded like a culture issue.
I asked him to share the Company Values that he and his cofounder had developed several months ago. This list of over a dozen platitudes came packaged in a beautiful slide deck and featured short, catchy phrases accompanied by rich imagery - the sort of thing you might see on a poster in a high school gym. He and his cofounder had fallen for a common trap in Values development. The Values they’d developed were aspirational but not actionable.
We probably all have a cringe Values experience from our careers. Phrases that may be written on the wall or in an employee handbook, but enter the day-to-day no more than a few times a year. Most leaders struggle to define strong Company Values because they start with the wrong premise. Company Values should not things that you value as a company. Values, when done right, should be behavioral guideposts - pillars of culture that extend the will of the founders on a day-to-day level.
Below is a quick summary of the exercise this founder and I went through. I’ve run this a few times and it’s always been helpful to those participating so hopefully this post will be as well.
Company Values writing guide
Brainstorm
Whether you already have a list of Values or are starting from scratch, I would encourage any founder to begin this exercise with a blank slate. Your final list may end up quite similar to your existing set but it’s a good idea to approach this with a first principles mindset. Start by asking yourself two questions:
What do we already do today that I really love?
What do we seriously need to improve and / or stop doing? (i.e. a top three priority)
Your answers should be rooted in the behaviors, styles and norms of your team. Market forces, product positioning, technology and customer are all crucial aspects of your company’s foundation, but those are all external factors. Values are purely internal assets.
Refine
Once you’ve reached a stopping point, take the list and refine it to no more than five Values. Some founders pushback on this but I have yet to be convinced that any pre-Series B company needs more than five to be effective. Your company shouldn’t be that complex. If it is you’re either doing too many things or you’ve hired too heterogenous of a team (working style). Values need to live in the minds of your staff. They should be able to memorize them in one sitting and be able to recite and explain desired meaning at any point during their employment. The more Values you have in total the less powerful each one is on its own.
Wordsmith
I may have mocked inspirational posters earlier but there is something to having pithy phrases. Short but memorable verbiage can effectively encapsulate complex ideas. They create a verbal shorthand for employees to communicate and make decisions when no formal guidelines exist. Facebook’s most famous Value, move fast and break things, captures speed and innovation, encourages risk taking, normalizes failure and underpins the broader hacker culture that early Facebook was famous for.
Implement
This is where most leaders get Values wrong. The job is not done once written on the wall. For Values to permeate a team and form or correct a culture, leaders need to create a system where those Values are regularly reinforced. Some Values are easier to test for than others. Some lend quite well to positive incentives while others can be instilled through discipline. Your ratio of carrot to stick will depend on your desired level of internal competition vs. collaboration. It’s impossible to advise on what’s best from afar so instead here’s an list of the tactics I’ve seed / heard of:
Company-wide recognition* (e.g. [Value] of the month)
Company-wide recognition* (e.g. The Dundies, but not mean)
Peer-to-peer nomination
Test during the interview process
Include in performance reviews
Hard rules (e.g. Amazon’s PowerPoint ban and the importance of narratives)
Soft rules (e.g. a16z’s $10 tardiness rule and the importance of founders)
Company norms (e.g. Amazon’s “door desks” and the importance of frugality)
Stories (too many to name but the tales that founders enshrine in company lore carry a lot of weight)
Filter-out systems (e.g. any elite military boot camp)
*could include a reward mechanism if desired. Cash, gift cards or random prizes all work. My personal favorite is “lunch with the founders”
What does good look like?
You’ll know that your Values have taken hold when you start to hear your Values in every day conversation. The phrase itself becomes shorthand for the related behavior and can be used to encourage or dissuade the listener from veering off course. A personal example comes from my time at Entrepreneur First (EF).
EF had a number of values but one of the oldest and most established was Strong beliefs, weakly held. Internally this meant that we were a passionate group of builders who trying something that many doubted. We needed to believe in what we were doing in the face of critique. At the same time, we could not become so dogmatic in our thinking that we ignored conflicting data. We had think our ourselves as passionate experimenters; passionate about proving our hypotheses but happy to change course if new information arises. I haven’t worked at EF in years but that description was immediate recall and I would be that if asked, any of my colleagues would say the same.
While working at EF, the phrase Strong beliefs, weakly held was used a lot. A verbal reminder could unblock gridlocked debates or provide air cover when an initiative seemed to be sinking. Those four words normalized a behavior and enabled employees to pass it down to one another regardless of tenure, location or title. It may have been recognized through company awards annual retreats, but the Value lived in the day-to-day meetings / conversations / debates between peers.