Powered by Principle: Using Core Values to Build World-Class Organizations

By Amie J. Devero

In the course of six years of research and more than fifteen years of field work, Amie Devero has distinguished many of the key characteristics common to the thousands of organizations that maintain better than average results and ethical performance over the long term. What stood out was the degree to which they all use deep-seated core values for their decision-making and management.

If you are a leader or a manager, an investor or a student, the tools and practices that are presented here will become indispensable. Powered by Principle not only explains why these types of organizations do so well, but provides a detailed, step by step guide for how to create this kind of dynamic and aligned organization.

From the rationale to the exact type of process one should use to measure the expression of core values, every step is outlined here. Along the way, you will also gain knowledge of ways to develop your own thinking and mindset for this profound journey to become Principle-Powered.

Regardless of your title, role or tenure, you will find a way to make your organization far better, and to make yourself better along the way.


Olympic coach Indra Reinpuu shows how to live the dream. For many years Indra has shared his experience and knowledge with state and national League coaches of volleyball and netball, as well logging over 6000 one-on-one sessions as a personal trainer. He is a motivational speaker and the current South Australian Sports Institute Volleyball Development Coach.

• Language: English
• Publisher: DoctorZed Publishing
• Release date: May 1, 2010
• ISBN: 9780987467614

Amie J. Devero

Amie Devero has nearly twenty years of experience in helping organizations and people produce extraordinary results. She was educated at Bennington College, Harvard University and The London School of Economics, and holds two masters degrees. After retiring from a successful career as a professional dancer, Amie founded Execufit Ltd, a wellness consulting company based in London, UK.

Book preview

POWERED BY PRINCIPLE

Using Core Values to Build

World-Class Organizations

Amie J. Devero

DOCTORZED PUBLISHING

www.doctorzed.com

© No part of this book may be reproduced, stored in a retrieval system, or transmitted by any means without the written permission of the author.

First published by AuthorHouse, USA

2007 Amie J. Devero. All rights reserved.

eISBN: 978-0-9874676-1-4 

This ebook 2nd edition published and distributed by DoctorZed Publishing, 2012

www.doctorzed.com

Contents

Dedication

Acknowledgements

Introduction

Why Powered by Principle?

What Are Our Real Values?

The Context for Principle-Power

Developing Core Values

Strategic Core Values

Powered-by-Principle Alignment

Being Powered by Principle: Leadership and Culture

Global Issues (CSR) and the Powered by Principle Approach

Business, Values, Faith and Spirit

Other Paths and Final Thoughts

Endnotes

Index

Dedication

We benefit in profound and lasting ways from the work of millions of men and women who never stop striving for excellence despite the lack of applause, acknowledgement or thanks.

This is for all those unheralded champions.

Acknowledgements

There are many people to thank, since this book has been five years and two complete iterations in the making. My former business partner, Francis Wade, was the instigator, and in many ways an early coauthor. Without him the very idea of being Powered by Principle might never have emerged. I thank all of the clients who were in some ways guinea pigs for this approach, benefiting from, but also tolerating, the stumbling and missteps that accompany any developmental process. The CEOs who allowed me to interview them were exceptionally honest and forthcoming in sharing their own strengths, but most importantly, their failures. Their input was invaluable in every aspect of the development of the approach and the book.

Art Fyvolent, who is both a friend and a colleague, has always made me and my work look far better than it may really be through his impeccable design. Without the copy-editing help of Karen Andrews the final draft might have been inscrutable. I also thank my friend David Austin, who when no one else noticed my inertia, stepped forward to act as an elephant-like reminder of what I said I wanted to accomplish. The power of being held to account cannot be overvalued.

Many other friends have been coaches, hand-holders, shoulders to cry on, interim editors and trusted advisors: Isidro Fernandez, Barrett Spencer, John Foster, Hilary Andalman, Julio More Jr., Kirstin Johnson, my mother and father, both of whom played distinct roles in encouraging and critically cautioning me, my sister Andrea and many others along the way. Thank you all.

Introduction

Leges sinemoribus vanae (laws without morals are useless).

-Motto of University of Pennsylvania Law School-

I remember watching Wall Street, the Michael Douglas movie of 1987, and listening with a mixture of disgust and empathy to the Greed is Good monologue. At the time it seemed like a gross exaggeration of reality and I dismissed it as mere entertainment. Not too much later, in the mid-1990s, a television show called Survivor came to the airwaves. At first I thought it was a great idea. After all, what better way to measure real teamwork, cooperation, persuasiveness and innovation than by testing a group’s ability to survive in a wild environment? Boy, did I ever have that wrong! Instead of encouraging these qualities, which I knew from experience made people and organizations successful, the show rewarded lying, cheating, backbiting, undermining and pure self-interest. Being a consultant who specialized in transforming organizational cultures, I felt nauseous and somewhat irrelevant every time I heard the show mentioned – and it was mentioned incessantly in those early days. It seemed pretty obvious that something in my relationship to business was not very well-matched to a change that was taking place.

Of course, the trend was not limited to the world of entertainment. This was the beginning of rock-star CEO’s and the huge salaries and bonuses for them, as well as for hedge- and other fund managers, star athletes and a host of other select categories of individuals. The days of being a team player seemed to disappear with the disbanding of the Michael Jordan Chicago Bulls. Suddenly (it wasn’t really sudden, it just seemed that way) it was every man for himself. So flagrant was the mood that Leona Helmsley said (and was not lambasted for saying) that taxes are for the ‘little people’. as she was taken to prison for tax evasion. That kind of comment, rather than fueling rage, just emphasized the get whatever you can, however you can mood. Historically this all would have been seen as a mere cultural blip—like another 1970s me era or like the moral abandon of the flappers before the crash of 1929 – but instead, it marked a real sea change. This was different for a lot of reasons. The most important was the technological change that was giving rise to real globalism. The world may have been shrinking a bit to that point, but as Thomas Friedman¹ points out, we were aiming for a complete flattening, an inescapable interdependence of every market, country, currency and culture.

The advent of the Internet and of e-mail becoming available all over the world meant that while greed might still be good and the engine of capitalism, it was not delivering nearly enough to its little people, the worker. Fewer and fewer Americans were willing to do the work that had powered the industrial age, and many of those jobs had gone overseas twenty years earlier to countries where labor was cheap. But the discontent with rote work was spreading beyond the factory floor. Now service, telephone and agricultural work were also no longer satisfying. Greed being what it was, people wanted to make more money, and they wanted to have more fun doing it, as well. With the economy booming, technology companies spreading like an epidemic, IPOs and the new ability of ordinary people to become millionaire day-traders in their bathrobes, mega-distributors on eBay or real estate moguls in their spare time, organizations were suffering. The job market has never let up since then, and to this day remains tight despite the current strife in our economy. Getting good people to do good work is not as easy as it was in 1980.

Then it all hit the proverbial fan with the Enron debacle in 2001 and the loss of 20,000 plus jobs in one sweeping blow. Of course, that wasn’t all. Soon WorldCom, Tyco and HealthSouth followed suit with their own ethics scandals. Even America’s homemaker extraordinaire, Martha Stewart, seemed to be operating with no moral or legal direction.

Now I need to make a detour in the story for this to make any sense.

At just around the same time as Enron, my former partner Francis and I started to make a discovery: organizations are not just collections of individuals. If they were, then developing those individuals into great, open-minded people would create great results for the company. Unfortunately, great individuals, even when banded together in an organizational chart, still just produce great results for themselves, not for the bottom line of the organization. This was distressing to us because we specialized in creating just those kinds of group transformations for organizations. But we soon found an alternative way to accomplish both the bottom-line improvements for our clients and the transformation in the individuals, including every level of employee.

Since the problem seemed to come from great people doing the wrong things, we wanted to know how they could learn which things were right so that they would choose to do those things. Our problem wasn’t with them doing anything immoral or unethical, just stuff that didn’t help the financial results of our clients. After a lot of research and testing, we stopped working on people and started working on strategy. But our approach was unique. We developed strategy with the executives using a method called Strategy Mapping², and then worked to make sure that every single employee knew and understood it, and most importantly, saw the way that their individual contribution drove that strategy. When people know why they are doing something they do it far better.

Well, we were working on building strategy-focused organizations³, and then Enron and all the other scandals unfolded. It wasn’t long before our clients became pretty worried about their own ethical and legal standing. Since we were already helping with the development of core values as part of strategic planning, this concern naturally came to us. Over the course of the next few years we were able to find a way to bridge the huge conceptual gap that exists between what have been called core values and the arena of operations and financial metrics. For our own work, this marriage of domains was a personal and professional epiphany. Being able to help our clients produce measurable business breakthroughs while building organizations in which the people were satisfied, self-expressed, excited and producing real results – well, nothing could have been more of a delight.

As I continued to work in this area, my partner and I now working separately, it became more and more obvious that there was a real interrelationship between long-term success and core values. Even though the entry point might have been through the fear of shady behavior, the benefits that could be gained by linking strategy and principles were innumerable. All of the issues that had started in the early 1990s have now evolved into worldwide economic realities. The job market is still tight, and Americans (and Europeans) still don’t want to do menial work. But today foreign talent can do more than answer phones – they can produce almost anything we can, often better and always cheaper. That circumstance has made a lot of traditional roles irrelevant. The fact is, there is often no advantage even to doing payroll and benefits administration in-house. So Human Resource departments now need to justify their existence by finding ways to build value. The Human Resource profession has been turned on its head by that reality – yet even there, the crisis has generated an opportunity, just as the problems of the 1990s created the impetus for getting Powered by Principle.

Workers are still in hot demand, and in order to take positions they are requiring ever-increasing levels of personal satisfaction beyond financial compensation. That leaves organizations in a constant quandary as to how to get great employees. And getting them isn’t enough because careers aren’t what they once were. At first, when work became a transient phenomenon, the workers felt abandoned by the parental corporation. Now, the companies are themselves equally insecure. Employees are fickle and often leave precipitously, move to new locations, decide they want novelty or simply get stolen away for better pay. Since the work they perform isn’t menial it is hard to replace, and the cost of employee turnover is enormous and potentially deadly. Even worse than the cost of hiring new employees is the loss of productivity while new hires get up and running. So there are many good reasons to keep employees happy and anchored.

None of this even addresses the most important benefit of being Powered by Principle. Companies that have strategic core values, and align themselves to them in every way, do better over the long term no matter what measurement of success is used. They deliver better products and higher quality services, keep their customers and employees, make more profit, have better-than-average stock value and endure while their competitors fall by the wayside.

Even as I tried to help companies become Powered by Principle, I saw an unavoidable truth: There are hundreds, perhaps thousands of organizations that are already Principle-Powered. But they got there their own way, through their own unique process. My curiosity drove me to learn how they did it and what they learned, and I stole their methods shamelessly and incorporated them into the methodology that was emerging. The Powered by Principle approach is really the amalgamation of best practices and powerful ways of being from the more than one hundred CEOs I interviewed and the many clients who collaborated in the development of this process. No individual step here is a new creation, just the over-arching structure, terminology and explanation. But even as a mere assemblage of the genius of so many leaders and committed employees, Powered by Principle is a distinct approach. Most importantly, it will take you a long way toward building an extraordinarily strong, lasting and productive organization.

Chapter 1: Why Powered by Principle?

A successful investor had recently inherited a number of properties from his father. They were commercial and multi-unit residential buildings located throughout the greater Baltimore area. In order to maximize his efficiency, the investor traveled to Baltimore, having made arrangements to spend several days with a local real estate expert looking for distressed properties he could purchase to further bolster his real estate holdings. He planned to spend the last two days visiting the properties he now owned, reviewing their condition and collecting the information he would ultimately need to make decisions about how to proceed with them. Having grown up in the city, the investor was intimately familiar with the area. Most specifically, he was familiar with the properties he had just inherited from his father, who himself had built many of these buildings fifty years before his death.

The broker, Mark, was one of the most successful in the city, and worked for a large real estate company—one that had been growing in leaps and bounds primarily though acquisition. Its reputation for information collection, attention to detail and integrity was exemplary, which was why the investor chose to work with that firm. He didn’t have time to waste and wanted to be certain he was getting accurate information, since he would be making decisions on the fly.

As the investor and the broker approached one particular building, the broker explained that the building had been on the market for some time, and that he had an exclusive listing on it, which was why there was no signage indicating that it was for sale. He vaguely alluded to the income stream that the building would generate and confided that he had a very long-term relationship with the owner, his client. Mark was certain he could get this building for a great price! The investor was quiet, simply listening to the agent go on about this opportunity. Finally, the investor said, I’m familiar with this property. Actually, it isn’t for sale. Mark began to protest, No, it is, it’s owned by the H family and they want it sold. The investor smiled slyly, now realizing just what kind of person Mark was. My father was part of the H family and he built this in 1923. I own it. The investor never again used that real estate company for any of the millions of dollars he continued to invest in property.

How can an organization build a long-term strategic advantage in a way that also produces ethical behavior and an environment in which each person has the freedom to be creative, authentic, and to fully express him or herself? This is a challenge for the best of organizations and one that is never fully resolved but must be revisited time and time again. At various times in modern history, different aspects of this challenge have been pre-eminent. Recently, the primary challenge has been to deter leaders and employees from succumbing to unethical behavior. That momentary concern arises from the publicity surrounding certain infamous scandals, but the long-term view points toward a much wider range of organizational and business concerns. Those concerns include ethics and corporate responsibility, but are not defined by them.

More companies than ever are creating core values. But for most, those statements are used primarily as inspirational tools, posters in the lunchroom and pages in the employee handbook. For organizational leaders, a challenge is at hand: Can we get those core values to penetrate every moment of organizational life, from the policies and procedures to the heart and mind of each employee? If we can, how do we go about it? What must we do and what kind of leaders must we be? The challenge extends into the areas of customer service, management style, employee participation, and the very fulfillment of organizational missions. When values are alive, they bring with them a tone, an ethos, and a set of overriding directives that are integrally related to the quality of life at work, the quality of delivery to customers, and the quality of decision-making at the highest and most far-reaching ranks of the organization.

The process that answers this challenge is not a silver bullet but an organic approach to strategic planning and management that places core values at the epicenter of the organization. In recent years, finding ways to promote and ensure ethical behavior has often seemed like the most critical of those benefits. But as the ethical emergency recedes, new priorities are emerging. The need to find ways to build strategic advantage and to create workplaces that challenge and excite workforces, harnessing the creativity and commitment of those people will always be vital. Getting Powered by Principle is the ultimate goal for organizations that are committed to being truly values-based. But it isn’t a final destination. Instead, it’s a beginning and an ongoing approach to a particular way of doing business. The process requires vigilance, attention and introspection in perpetuity. The potential rewards are enormous, in terms of both business results and the personal accomplishment of creating extraordinary workplaces that fulfill the needs and address the concerns of all stakeholders. Principle-Powered organizations bridge the gap that normally exists between an over-arching strategy and the people who must execute it in real time. The gap is bridged by the core values acting as management tools, decision-making guides, policy advisors and standards for behavior and all operations. This way of doing business leaves people making many more of the right decisions with less need for external control, and producing outstanding business results in the process.

The