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24 January 2006
The views expressed here are the personal views of the participants, and are not necessarily the views of their organisations.
The following people were present at this fe3 mindstretch®:-
After introductions, the session began with some thoughts about why the idea of values has taken hold of many organisation. The definition of corporate values is one way of helping to spell out certain behaviours as socially acceptable, and is less exhausting for management than command and control mechanisms as it requires less monitoring. The need to engender commitment to work through the creation of some sort of positive emotion has to a large extent, been driven through the loss of “jobs for life” – management needs to find something other than money to make organisations engaging. The development of attractive corporate values is one method of doing this.
Some academic studies have found that the adoption of some kinds of organisational values did to some extent predict employee levels of commitment.
There are issues in the academic literature about the subject of organisational values , not least that of definition. Most do, however, agree that a value is a standard or criteria for choosing goals or guiding action. Perhaps more controversially, there is the debate about whether values can be changed, or indeed should be changed. In our meeting too, there was disagreement about whether values can be changed, and some thought that it would take a significant life event or crisis to do so.
However, the espousal of a number of corporate values often has unforeseen consequences – and one of these is that the values don’t work perfectly together and in fact may pull against one another. It’s generally held that the strategy of the organisation has an effect on the importance of the values in terms of importance – and most academics working on values have considered them in terms of their relative importance in the organisation. Therefore strategy influences even where the values pull against one another.
We then looked at a couple of frameworks developed by academics to discuss this in more detail.
The first, developed by Quinn and Rohrbaugh came out of the organisational effectiveness literature. Their central tenet is that effective organisations need to satisfy multiple performance criteria based on these four general values. At the core of the model is the assumption that there will be competition among the four values. The two axes it contains are those of flexibility vs control and an internal perspective vs an external perspective.
The internal process value emphasises the need to maintain control. It is internally focused and stresses information management, communication, stability and control.
The human relations value emphasises flexibility and has an internal focus, stressing cohesion, morale and ultimately, human resource development.
The open systems value places emphasis on flexibility and has an external focus and would stress flexibility and readiness, the need to acquire resources and change, and “monitor and coordinate with other organisations while adapting to and incorporating externally imposed changes”
Finally, the rational goal value emphasises control and external focus, using planning and goal setting as means, and productivity and efficiency as ends. The organisation looks to maintain current output while watching for and planning for changing trends in the market.
Karen noted that in the arena of values research, employee commitment has been measured against these value sets and the value set which most predicts employee commitment is that of human resources.
The second framework, developed by Kabanoff and Daly, looks at the two elements of structure and process. Their main premise was that organisations need to balance the tensions inherent in doing business – allocating resources efficiently to maximise outputs (that is, with a level of inequality) while allocating them equally enough to maintain social cohesion and some level of co-operation. Their framework shows how different organisations seek to resolve these tensions in the way they stress different values.
The structure part of the diagram considers how centralised power is in the organisation. Process is the policies and practices of the organisation. Both dimensions has efficiency (or relative inequality) at one end, and equality at the other. On the process dimension, this is expressed as equitable (or being rewarded for effort or other criteria) at one end and egalitarian (or everyone being rewarded at the same level) at the other.
In the elite organisation, which is both centralised and equitable (or relative inequality in both structure and processes) the values of authority, performance and reward are emphasised and leadership, teamwork, participation, commitment, normative (i.e. concerned with social order and rights), and affiliation (sharing together) are de-emphasised.
In the collegial organisation, which is both decentralised and egalitarian, more emphasis is placed on the group values of teamwork, participation, commitment, normative and affiliation than on those which stress individuals (authority, leadership, performance, reward).
Processes can either serve to counterbalance or to reinforce the structure – for example, an organisation with an egalitarian orientation might
reinforce this structure through a pay policy which compresses salary differentials, or counterbalance it by linking pay to performance appraisal.
Karen said that this part of the presentation was to stress that espousing values may have far-reaching consequences, many of which aren’t
really thought through. Organisational values are a strategic tool and if they are to flourish, need to be supported by, and support, the direction of the business.
She illustrated this with a couple of diagrams from a piece of work completed for her Masters. Her project was with a large children’s charity and the topic was the impact of the charity’s values on recruitment. As part of the preparation for the main survey, she spoke with a number of senior people about the values, how credible they were and how alive in the organisation. Karen found one or two of the values oddly missing from some of the interviews, leading her to look at the difference in perceptions of the senior management and those of “rank and file” employees.
It seemed to her that the reputation of the charity to develop new and innovative ways of tackling children’s issues was very powerful as a recruitment tool – particularly as many joining the organisation came from local authorities where methods of working were quite “set”. If doing things differently was the key strategy for the organisation, the values would line up as in this slide – with the value of ambition and growth relegated to “nice to have”.
However, the charity was trying to grow itself out of financial difficulties and as a result was tendering for a great deal of statutory sector work, where the prime requisite was cost and safety. This effectively relegates the value pioneering to relative unimportance (innovation can be both risky and expensive), along with positive (not essential) and collaborative (which in a competitive tender, could work against the charity).
These two slides illustrate the point that the organisational strategy influences the importance of the values and if they’re not balanced or the strategy isn’t communicated, or the values bear no relation to the strategy, espousing them may generate a very cynical response from employees.
For details of the case study given by Mike Green of the QCA, please click here to go to the QCA Case notes.