I recently attended a dinner with a group of HR leaders and Chief HR Officers. The conversation turned to one of my favorite topics, organizational culture. I mentioned that core values are foundational to a strong culture. One of my tablemates said, “Our organization doesn’t have core values.”
I responded, “It absolutely does.”
While they may not be posted on the walls or noted by a leader at the top of every town hall, every organization has values, and possibly micro cultures.
If you’re not sure if your organization has core values, think about what behaviors at your company are celebrated or tolerated, and which ones aren’t.
Your culture supports how the members of your organization work together and measure their results. Values influence how you get that work done.
Organizations with cohesive, collaborative teams that innovate and excel in meeting business objectives almost exclusively have leaders who talk about values consistently.
When it comes to assessing the health of an organization’s culture, I’m not looking at perks or engagement scores, but instead something deeper. I pay close attention to an organization’s leadership practices. I want to understand how success is recognized and rewarded — specifically, whether achievements are celebrated not just for results but for being accomplished the right way. I look at how leaders develop teams and individuals, whether they foster an environment in which coaching and mentorship drive higher performance. I also consider how a company responds when a leader violates trust, as this speaks volumes about its integrity. Equally important is how the organization handles well-intentioned mistakes — does it treat them as learning opportunities or punish those who take thoughtful risks? These factors reveal the true character and culture of a workplace and its leadership.
Core values shape the way an organization functions every day. So, if I see deficiencies in how often team members get feedback from their direct managers or whether people are recognized for innovative thinking, it’s time to evaluate how core values are upheld.
For me, the work I love most is helping organizations align the core values they say they live by with the ones that are truly in action. These moments of alignment — or misalignment — are critical. When values are clear and consistently reinforced, they serve as a compass for decision-making, collaboration, and innovation. But when they’re ignored or inconsistently applied, things can quickly fall apart.
Organizations with cohesive, collaborative teams that innovate and excel in meeting business objectives almost exclusively have leaders who talk about values consistently.
Core Values Guide Everyday Decisions
Think of core values as a decision-making compass. They’re not just words on the careers page of a website. They’re the invisible guardrails that help employees and leaders navigate tough challenges or choices with confidence and integrity.
When values are clear and actively embraced:
- Decision-making becomes empowered. Employees don’t need to wait for constant approval because they know what’s right for their organization. They act in alignment with the company’s values.
- Trust and ethics flourish. Businesses that live by values like transparency and accountability can avoid ethical missteps and build lasting reputations.
- Customer experience improves. Companies that value customer service don’t just talk about it. They give employees the autonomy to solve problems proactively.
I’ve seen this in action many times. I can recall one client’s transformation vividly. Their values centered on putting customers first, yet their rigid policies often made it impossible for employees to help customers. When we achieved alignment with their values by relaxing the rules and training team members to use their best judgment, they got a more engaged workforce and far happier customers.
Good leaders know how to navigate uncertainty, and the best leaders use core values as their north star. They ground decisions not in convenience or the current trend, but in those guiding principles that reflect the true essence of their organization. When faced with ambiguity, core values become an internal compass, a touchstone to help leaders make decisions in alignment with both culture and business strategy.
But they can’t do it in secret. When employees and customers want to know why certain decisions are made or new strategies take shape, leaders should lean into their values message. Giving a “why” rooted in core values helps build support for values-based behaviors at all levels.
The Building Blocks of Culture
Culture isn’t company paid snacks in the office or a “fun” Friday happy hour. Culture is based on everyday behaviors: how an organization sets goals, handles conflict, trains and develops employees, and stays focused on customer needs. It’s reflected in how managers provide feedback, how teams collaborate under pressure, how leaders address conflict, and how companies celebrate success.
Strong core values create a culture in which team members feel committed and connected. Shared values foster trust, making it easier for teams to solve problems and experiment with new ideas, boosting innovation. Core values offer stability and support focus, especially in times of acute change. When the external environment is uncertain, core values become a constant; the north star that keeps the organization grounded and moving forward.
If culture is about relationships — how individuals work together to achieve shared goals — core values set the tone for those relationships and define what behaviors are acceptable, tolerated, and celebrated.
Culture is upheld when employees receive actionable feedback from their managers regularly, and when individuals and teams can collaborate effectively through difficulties and difference.
Leaders serving breakfast to employees as a show of “servant leadership” doesn’t bring culture to life as well as demonstrating they understand what a company’s customer needs and encouraging employees to develop ways to meet those needs. Breakfast can be part of the discussion, but it’s just the backdrop for meaningful conversation, not the main event.
When the external environment is uncertain, core values become a constant; the north star that keeps the organization grounded and moving forward.
What Happens When Core Values Are Ignored?
When there’s a gap between an organization’s stated values and its lived culture, cracks begin to show. Trust erodes, engagement drops, and performance suffers.
I recall working with one company whose leaders said that they welcomed diverse perspectives. They prided themselves on inclusivity. But during a culture survey, it became clear that only one style of thinking was consistently rewarded. Employees who didn’t fit that mold felt sidelined, and many chose to leave.
The disconnect between stated values and actual behaviors had real consequences. Not only did this company shed employees but it also had great difficulty recruiting top talent. Many felt that company’s reputation no longer aligned with its mission and the business did not grow as it once had. This scenario is not unique.
When core values are ignored, the risks are significant. Employees and customers lose faith in leadership, resulting in diminished loyalty and morale. Without the “values compass,” companies may prioritize short-term gains over long-term sustainability, resulting in unethical decision-making. This can further destabilize an organization and damage a brand. Over time, a toxic culture can emerge, making it difficult to maintain a productive and motivated workforce.
Bringing Core Values to Life
The organizations that get this right don’t just list their values during onboarding or in glossy annual reports. They live them.
Here’s how they do it and how each organization that wants to “walk the talk” should approach creating or sustaining a values-based work culture:
Talk about values often and openly. Don’t limit conversations about values to strategy meetings or performance reviews. Integrate them into everyday decision-making.
Align leadership actions. Leaders set the tone. If they model values like integrity, transparency, and collaboration, the rest of the organization will follow.
Reinforce Values through Systems and Policies. Build performance management, recognition, and training programs that reward behaviors aligned with core values. Provide feedback when actions diverge from those values.
Measure and reflect regularly. If employee feedback indicates disengagement or conflict, reassess whether core values are being upheld or need revision.
Ultimately, core values are both the compass and the anchor for an organization’s culture. They help employees and leaders make decisions with confidence, collaborate effectively, and weather uncertainty with clarity and purpose.
What Can You Expect Values to Do?
Someone else at that dinner said that values are nice in theory and make for a more collegial workplace, but they don’t impact the bottom line. I strongly disagree.
Values have significant business impact. As I’ve noted when writing about culture previously, values come from organizational beliefs. These values give rise to behaviors. If those behaviors are successful in meeting business goals and objectives and maintaining an engaged, successful workforce, they are sustained. If they are found to be unsuccessful, leaders and team members return to the roots of the culture “tree” to develop new behaviors that then give rise to new beliefs, values, and behaviors.
These behaviors are how work gets done. When core values are more than just talk, the impact is undeniable:
- Higher employee engagement and performance. Aligned employees are more motivated, productive, and committed to the organization’s success.
- Stronger brands and loyal customers. Customers can tell when a business walks its talk and that earned trust gets rewarded it with continued loyalty.
- Attracting and retaining top talent. Values-driven organizations naturally draw great people. And they are able to keep them, giving them a strong competitive advantage of talent plus longevity.
- Better Teamwork and Innovation: Shared values create unity, making collaboration more natural and effective.
- Stability During Change: In uncertain times, core values provide consistency and a clear path forward, helping teams stay focused and resilient.
- Increased Profitability: A Gallup study noted that companies that align employee behaviors with core values see better than a 20% increase in profitability.
Measuring success isn’t just about hitting financial targets. It’s also about understanding whether your organization’s culture and values are truly driving performance. A well-defined process for assessing success should capture employee engagement and the overall effectiveness of collaboration. If you’re hearing consistent feedback about lack of engagement, difficulty navigating conflict, or an uptick in employee concerns, it’s a signal to pause and reassess. Are your core values acting as guideposts, shaping the behaviors and decisions that lead to innovation, collaboration, and growth? If employees feel unprepared, uninspired, or unsupported, the issue may not be strategy. It may be misalignment between the values of the organization and how they’re being lived day to day.
This alignment becomes even more critical when shaping leadership. Organizations that expect cross-functional collaboration of their leaders don’t just look for technical expertise. They seek individuals who can work seamlessly across departments, leveraging marketing intelligence, sales, M&A, and operations to drive collective success. The best leaders aren’t just skilled in their own lane; they’re connectors, problem solvers, and information-seekers. When a company makes it clear that leadership means breaking down silos and empowering others, it builds a culture in which strengths get amplified and the organization as a whole is positioned to outperform the competition.
Living Values
Core values are the compass that guides an organization’s culture, decision-making, and long-term success. But they require action.
Pull core values out of the handbook and into decisions and interactions. Live them, and they’ll strengthen every aspect of an organization.
