By Marshall Goldsmith (edited by Gil Dekel)
Companies spend a lot of effort to perfect their mission statements, but how effective statements are in influencing behaviours? It seems that companies have wasted millions of pounds agonising over the wording of statements, assuming that people’s behaviour will change because of certain words such as “integrate our strategy and values.” There is a hope that when people hear great words, that they will start to exhibit great behaviour…
Sometimes these words will evolve as people try to keep up with the latest trends in corporate-speak. For example, a company may begin by striving for “customer satisfaction,” then advance to “total customer satisfaction,” and then finally reach the pinnacle of “customer care.”
But this obsession with words disregards the fact that there is almost no correlation between the words on the wall and the behaviour of leaders. Every company wants “integrity,” “respect for people,” “quality,” “customer satisfaction,” “innovation,” and “return for shareholders.” Sometimes companies get creative and add something about “community” or “suppliers.” But since the big messages are all basically the same, the words quickly lose their real meaning to employees – if they had any in the first place.
Enron Company is a great example. Before the energy company collapsed in 2001, I had the opportunity to review their values. I was shown a wonderful video on Enron’s ethics and integrity. I was impressed by the company’s beliefs and the care that was put into the video. Examples of Enron’s good deeds in the community and the professed character of Enron’s executives were particularly noteworthy.
It was one of the most smoothly professional presentations on ethics and values that I have ever seen. Clearly, Enron spent a fortune “packaging” these wonderful messages. It didn’t really matter. Despite the lofty words, many of Enron’s top executives either have been accused or are in jail.
The situation couldn’t be more different at Johnson & Johnson. The pharmaceutical company is famous for its Credo, which was written many years ago and reflected the sincere values of the leaders of the company at that time. The J&J Credo could be considered rather old-fashioned by today’s standards. It contains several phrases, such as “must be good citizens – support good works and charities – and bear our fair share of taxes” and “maintain in good order the property that we are privileged to use…”[1] It lacks the slick PR packaging that I observed at Enron.
Yet, even with its less-powerful language and seemingly dated presentation, the J&J Credo works – primarily because over many years, the company’s management has taken the values that it offers seriously. J&J executives have consistently challenged themselves and employees not just to understand the values, but to live them in day-to-day behaviour. When I conducted leadership training for J&J, one of its very top executives spent many hours with every class. The executive’s task was not to talk about compensation or other bonuses of J&J management; it was to discuss living the company’s values.
My partner, Howard Morgan, and I have completed a study of more than 11,000 managers in eight major corporations.[2] We looked at the impact of leadership development programs in changing executive behaviour.
As it turns out, each of the eight companies had different values and different words to describe ideal leadership behaviour. But these differences in words made absolutely no difference in determining the way leaders behaved. One company spent thousands of hours composing just the right words to express its view of how leaders should act – in vain. I am sure that the first draft would have been just as useful.
At many companies, performance appraisal forms seem to undergo the same careful scrutiny as credos. In fact, more effort seems to be given to producing the perfect words on an appraisal form than to managing employee performance itself. I worked with one company that had used at least 15 different performance appraisal forms and was contemplating yet another change because the present sheet “wasn’t working”! If changing the words on the page could improve the performance management process, every company’s appraisal system would be perfect by now.
Companies that do the best job of living up to their values and developing ethical employees, including managers, recognise that the real cause of success – or failure – is always the people, not the words.
Rather than wasting time on reinventing words about desired leadership behaviour, companies should ensure that leaders get (and act upon) feedback from employees – the people who actually observe this behaviour. Rather than wasting time on changing performance appraisal forms, leaders need to learn from employees to ensure that they are providing the right coaching.
Ultimately, our actions will say much more to employees about our values and our leadership skills than our words ever can. If our actions are wise, no one will care if the words on the wall are not perfect. If our actions are foolish, the wonderful words posted on the wall will only make us look more ridiculous.
22 June 2016.
© Marshall Goldsmith (edited by Gil Dekel). Image and text published here with permission of authors.
Footnotes:
[1] J&J Credo. Accessed 22 June 2016, from: https://www.jnj.com/sites/default/files/pdf/jnj_ourcredo_english_us_8.5x11_cmyk.pdf
[2] See: “Leadership Is a Contact Sport,” by Marshall Goldsmith and Howard Morgan, strategy+business, Fall 2004.
