CFO Corner: Words Matter—Hollow Purpose Statements Hurt Your Organization
Many organizations have wasted immense sums of money in developing corporate values and re-orienting their strategies around corporate purpose. Usually, their intentions are good but unless these investments have an impact, where is the ROI?By Nick Shepherd
Creating a purpose statement might seem like good public relations. In today’s skeptical age, what is critical to success is that there is a clear operational linkage between the words that are used and the operational outcomes that are expected. What do the words mean in day-to-day reality? Otherwise, not only is the effort to create a purpose statement a waste of time, it can backfire.
Nowhere is this more critical than the clarity required around corporate values. These are supposed to be the foundations of behavior; yet, in many cases. the words used do not result in the expected outcomes. In my book “Toxic Culture” there are several examples of organizations that have stated values about the importance and value of people that are currently in court for contraventions of labor law. Organizations that proudly report statistics such as the hiring of minorities and the percentage of females in management positions are often the same organizations being sued for harassment and discrimination. However clear their stated purpose, the words apparently did not translate into how people build relationships and treat each other internally and externally.
This explains why so many corporate purpose statements amount to white-washing of little value or worse.
Anyone who has assembled IKEA furniture knows that in their drive for simplicity, instructions often fail to deliver clear guidance. So, it is with human behavior. Every single person within an organization—and especially those with supervisory roles at any level—must know exactly what the words being used translate into in terms of day-to-day decision-making and relationships. Without this, any hope of successfully optimizing employee engagement will fail. Expectations will be created but not be fulfilled because of a lack of agreement and understanding on “what does this mean.” Rather than creating a positive culture, hollow purpose statements can lead to cynicism and scepticism and a belief that what management says is not actually “what goes on around here.”
To solve the problem requires a positive answer to three questions.
1. Does everyone know and understand what operational behaviors and approaches to decision making are expected to support and deliver on the stated values?
2. Does every manager believe in, accept, demonstrate, and actively support those stated behaviors in their daily relationships with their employees and with all other relationships?
3. What processes are being used to reinforce the purpose statement and values, and what metrics are being used to measure their effectiveness.
If the answer is no to either of these questions, then employee engagement will not be achieved to the level necessary for predictability and a competitive advantage. Worse still, nothing can be measured in terms of the expected outcomes because nothing has been defined as the planned expectation. While measuring employee engagement is subjective, it can be measured with a higher level of confidence if supported by clarity of expectations and metrics.
Nick Shepherd, FCPA, FCGA, FCCA, FCMC
Eduvision Inc.
Subscribe to ESM's weekly newsletter.
Profit From the “S” of Environmental, Social, Governance (ESG)Through education, media, business development, advisory services, and outreach, the Enterprise Engagement Alliance supports boards, business analysts, the C-suite, management in finance, marketing, sales, human resources and operations, etc., educators, students and engagement solution providers seeking a competitive advantage by implementing a strategic and systematic approach to stakeholder engagement across the enterprise. Click here for details on all EEA and RRN media services.
1. Professional Education on Stakeholder Management and Total Rewards
-
Become part of the EEA as an individual, corporation, or solution provider to gain access to valuable learning, thought leadership, and marketing resources. - The only education and certification program focusing on Stakeholder Engagement and Human Capital metrics and reporting, featuring seven members-only training videos that provide preparation for certification in Enterprise Engagement.
- EEA books: Paid EEA participants receive Enterprise Engagement for CEOs: The Little Blue Book for People-Centric Capitalists, a quick implementation guide for CEOs; Enterprise Engagement: The Roadmap 5th Edition implementation guide; a comprehensive textbook for practitioners, academics, and students, plus four books on theory and implementation from leaders in Stakeholder Management, Finance, Human Capital Management, and Culture.
- ESM at EnterpriseEngagement.org, EEXAdvisors.com marketplace, ESM e–newsletters, and library.
- RRN at RewardsRecognitionNetwork.com; BrandMediaCoalition.com marketplace, RRN e-newsletters, and library.
- EEA YouTube Channel with over three dozen how-to and insight videos and growing with nearly 100 expert guests.
Strategic Business Development for Stakeholder Management and Total Rewards solution providers, including Integrated blog, social media, and e-newsletter campaigns managed by content marketing experts.
4. Advisory Services for Organizations
Stakeholder Management Business Plans; Human Capital Management, Metrics, and Reporting for organizations, including ISO human capital certifications, and services for solution providers.
5. Outreach in the US and Around the World on Stakeholder Management and Total Rewards
The EEA promotes a strategic approach to people management and total rewards through its e-newsletters, web sites, and social media reaching 20,000 professionals a month and through other activities, such as:
- Association of National Advertisers Brand Engagement 360 Knowledge Center to educate brands and agencies.
- The EEA Engagement widget to promote, track, and measure customers/employee referrals and suggestions that can be connected to any rewards or front-end program management technology.
- The Stakeholder Capitalism free insignia to promote a commitment to better business.
- The BMC Brand Club and transactional storefronts to educate corporate and agency buyers on the IRR market.
- The EME Gold program to educate the top 3% of promotional consultants on selling engagement and rewards services.
