Why Values for an Organization Are Important (With Types)
By Indeed Editorial Team
Published November 27, 2022
The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.
Companies often outline principles for how they hope to operate when they establish their business and as they continue to grow. These fundamental principles help brands show their employees and customers what they value most. Learning more about these essential principles can help you understand why they're important for businesses and how to implement them in your career. In this article, we discuss what values for an organization are, explore some key benefits, and discover the different types of values companies might use.
What are values for an organization?
Values for an organization are principles that show a company's purpose. They are often a set of ideas that show what's important to a company, how they hope customers perceive them, and how they want their employees to behave. There are different types of values that help guide different aspects of the business, contributing to an organization's overall culture and reputation.
Benefits of organizational values
A company's values are a unique set of beliefs that enable people to understand the company's goals. Here are some of the benefits of creating and sharing organizational values:
Develops a stronger brand identity
Brand identity is the way a brand presents itself to the market and interacts with its audience. It includes product design, audience targeting, employee relations, and customer service. When a company's basic principles reflect its identity, this becomes part of its brand. People may link the organization and its goods or services with the fundamental values it displays, which can lead to stronger customer loyalty. For example, if a brand communicates that it uses fully recycled materials for its products, one of its values may become environmental consciousness.
Increases employee loyalty and attracts talent
When employees are proud to work for a company, they may do a better job and bring in other people who share the same values. People looking for jobs often do a lot of research about companies before applying. For example, they might look at the company's website, online reviews, and social media. Just as a hiring manager seeks to fill a position with the ideal candidate, a candidate also seeks employment with the ideal organization. For example, a law firm may promote its values of integrity and honesty. When someone is looking for a role in the legal field, they might apply to the firm based on the values it communicates.
Promotes a favourable corporate culture
A healthy work culture prioritizes the well-being of its employees and fosters a supportive environment at all organizational levels. It can also implement policies that promote respect, trust, empathy, and support. A common belief system and a commitment to sustaining those standards help create a pleasant working environment for the company's personnel. This involves designing clear values and communicating them with employees so that everyone can share them and implement them accordingly.
Differentiates a brand from the competition
Values for a corporation can help companies differentiate themselves from the competition. Companies within the same industry often share common core values, but they can have additional values that make customers and prospective employees have a greater interest in their business. For example, while many businesses in the construction industry communicate quality as a value, one company might share sustainability as a value to stand out from the competition.
Clear values can also improve productivity for employees and teams. With a clear set of values, employees may collaborate better using the same principles to guide their actions. For example, a culture of accountability helps ensure that each employee owns their tasks. Helping individuals stay accountable can improve overall performance, efficiency, and productivity across the business.
Types of organizational values
Organizations often maintain a range of values that assist them in accomplishing their objectives. Rather than focusing on just one type of value, organizations can be successful if they take a more holistic approach. Most businesses focus on a few principles that their employees and the public may easily recall. Here are some organizational values to consider:
A company's core values are the foundational principles and beliefs that guide its operations and the behaviour of its employees. These are often long-term qualities and ideals that the company's founders establish when starting their business. Future decisions and actions are then determined by those core values, including hiring practices, workplace culture, and employee satisfaction. Some core values include:
Diversity and inclusion
Aspirational values are the ones that companies might determine to show what they hope to achieve in the future. For example, a company might want to commit to more diversity in its hiring practices and product offerings. It can then use this value as a guideline for targets and objectives. Sometimes, these aspirational goals may change if they conflict with core values. With this, leadership can then decide which ones are more important to their business model and reputation.
Teamwork values are those that companies set to encourage employees to work better with each other. These often focus on how they might promote collaboration between individuals and departments to reach their goals. Even with companies where many people work independently, such as IT call centres, employers can emphasize these values by promoting open communication and allowing teams from different departments to learn from one another. Some types of teamwork values include:
Permission-to-play values are often basic values that company leadership hopes their employees can follow. These are commonly standard values that many companies within an industry share. For example, they may value hard work or the ability to meet deadlines. Different from the other types of values, this is often a behavioural standard that doesn't differentiate a company from others in the field. These might be similar to core values like respect, accountability, and honesty.
Accidental values are those that companies acquire without intentionally setting them. This often happens when employees at a company have certain qualities and behaviours that influence a company's values. For example, if many employees are highly creative, they might foster this value, as it can help their business grow. Accidental values may also come from customers, as how customers perceive a company can influence their brand and what's important to them.
Corporate stewardship values
Corporate stewardship values show a commitment to the responsible use of resources. These values aim to make the world a better place by making decisions that show respect for the planet and its people. For example, employees and customers with a passion for environmental issues may pursue a relationship with a company that has these types of values. Corporate stewardship values can include:
Market values help businesses satisfy their customers' wants and needs. These values concern the way they sell and promote their products and services. They help to shape a company's brand and reputation. Market values may include:
Inclusivity and representation
Financial values concern the way businesses manage their money. These values help companies please stakeholders by increasing profits and making sure they stay economically viable. These values can encourage employees in an organization to help companies work within their budgets and understand short- and long-term goals. Some financial values include:
Creative values are beliefs surrounding original ideas, unique ways of thinking, and innovative solutions. A company that upholds these beliefs may encourage employees to be curious and ask questions when problem solving. These values often help brands differentiate themselves from the competition. Some creative values include:
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