One endearing question organization leaders are asking themselves is whether organizations should move from being profit focused to value focused? Profit driven organizations believe that organization decisions should largely be profit based as profit creates value for business.

On the contrary, Value driven organization leaders believe that organization and leadership values drive business. The latter idea comes from Kotter and Heskett’ s Corporate Culture and Performance research on 200 companies that revealed that value driven organizations outperform profit driven ones. Their research findings affirmed the premise that: value drives culture, culture drives employee fulfillment, employee fulfillment drives customer satisfaction, and customer satisfaction drives shareholder value.

Hopefully a look at what value based leadership really ease will provide more answers.

Value Based Leadership Defined

Value Based Leadership is a progressive model approach to leadership that supports leaders achieve organization goals. This is through leaders practically connecting organization values to personal and staff values. The concept around this leadership style is that people generally live according to their value beliefs; and are thus more likely to abide by corporate values that resemble theirs value beliefs.

In terms of performance evaluation, value based leadership is all about leaders evaluating self and staff performance on set organization values; not on profit metrics alone. This is evident especially during organization change as during change most organizations are forced to adapt to new way of doing things. This automatic calls for a change in leadership style and performance review system.

Value based leadership in summary encourages:

• Use of organization values and ethics to guide organization decisions.
• Respecting and incorporating employees, customers and stakeholder’s views through open communication and displaying in action willingness to share and reward value based success.
• Strategic implementation of plans and strategies through creating shared value bonds between leaders and implementers.
• Talent acquisition through matching competencies, personal character, values integrity to organization values.
• Translation of company vision, mission and values into direction, strategies and goals that promote corporate culture.
• Taking full responsibility for all actions taken on behalf of the organization
• Displaying integrity in the midst of contravening internal and external forces.
• Leaders using motivational tools and inspiring staff through value based programs that promote less control and command on the working business environment.

SO WHAT ARE THE MERITS OF VALUE BASED LEADERSHIP

1. To Company leadership
2. Better Leadership Perspective

According to a Harvard Business Paper, when leaders focus on upholding values and maintaining integrity, they acquire a long term perspective of the company goals, thus creating the necessary environment to foster innovation that maintain organization competiveness in the business environment. Inversely, an overemphasis on the Technical and administrative role in business always leads to short sightedness which equates to short term results.

1. Builds Personal Trust and Integrity of Leader

When a company’s corporate values are put in action by its leaders, it affect the perception company staff have of their leaders. This perception espouses company staff to exude confidence in executing tasks bestowed to them by their leader resulting in better staff engagement and work ethics.

2. To Company in General
3. Source of Staff Motivation and Creativity

There is always intrinsic motivation to want to work for someone that shares your belief and values. Peter Senge’s book “The Fifth Discipline puts it clear that: “to have a company that will survive over time organizations need to align their vision and values to that of their staff’s.

Secondly, the VBL Journal view is that a company committed to adopting motivational strategies that aligning their staff’s values with organization values realize staff growth and an increase in productivity. This is because value driven leadership often creates a working culture that fosters creativity and innovation which are listed among the listed key drivers of world economy to date.

1. Better Alignment of Company Decisions

Incorporating company values in company policies ensures that company leaders align their thoughts, actions, systems and staff to what the company stands for. The result is better alignment in decision making, recruiting, selection and training processes, as every step made by the company’s executive is right, and reflects the company’s stance.

1. Precipitates Better Change Management

Value based leadership (VBL) is important in times of change and uncertainty. While vision provides the direction a company is headed to, value will most definitely define how to get there.

1. Less Organization Continuity Hiccups:

As an organization leader, instead of relying heavily on the predominant competencies during hiring, job appraisals and job termination, adding a few more sourcing methods into the mix namely: personal integrity, character and values as the basis of hiring, employee retention will at the end ensure all staff in your company match company values thus less evaluation headaches when it comes to job appraisals.

Disadvantages of VBL

According to www.valuebasedmanagement.net some of the drawbacks of Value based leadership are:

• There is no specific Value Based leadership Model to practice, thus the value based model you choose for your organization will have its positives and drawbacks.
• For it to work, Value Based leadership requires a strong support from the Top Management CEO’s and executive board; which can be challenging to attain.
• If wrong variables are used to measuring the impact of Value Based leadership on corporate performance, a company’s values may be eroded.
• It is not simple to implement (is as complex as corporate strategy).

Where to Begin With VBL

Matching company values to staff values at most requires self-assessment of the leader:

• Self-Reflection: Know who you are as a leader, what you want, and what you stand for. Once you know all these you can proceed to now identifying which values and behaviors of yourself demonstrate your company values? Once identified, integrate these behaviors into your leadership style by mimicking those value based behaviors as value is seen best through behavior alignment.
• Self Confidence: Be open to accept your strengths and weaknesses as a leader.

• Humility: always remember where you came from as a leader notwithstanding the title and accomplishments achieved. Humility allows you to have a personal demeanor becoming to your staff. This will make your staff relax around you and thus reveal their true character, values and aspirations; this better positions you to evaluate the status of your company’ corporate culture.

• Balance: accepting different perspectives that are contrary to yours and channeling them towards a common understanding. This is vital as it allows you as a leader to come down to the level of your fellow leaders and staff and understand what they value most and how best to communicate organization values to them.