What Is an Organizational Value Statement?

A value statement captures the core values of a company, which are the deepest and most strongly felt principles a company holds. So important are these beliefs that a company will not compromise them. They are constant, and, therefore, a well-written value statement should be considered a long-term or even permanent declaration.

All businesses have core values, though not all companies articulate them. Companies without a value statement should consider crafting one. A formal statement can be used as a yardstick by which to measure company behavior, actions and decisions. The statements also help attract and identify job candidates compatible with the company. Value statements help explain a company to the outside world.

Good value statements must represent the company's true beliefs. External mores, no matter how fashionable or likely to make a company look good, should not influence the statement. The statement should be straightforward, its listed values immediately understandable. Phrases such as "good customer service" are open to interpretation and less effective than specific phrases such as "build relationships by creating happy customers." Statements evoking emotion will help inspire and motivate company-wide compliance with values. Good value statements answer the question "What does this company stand for?"

Sometimes companies include core beliefs in their mission statements. A mission statement explains why a company exists. Companies might also include values in vision statements -- aspirational declarations of what a business aims to become. Mission and vision statements change as a business evolves, while a company's core values remain steadfast. A stand-alone value statement provides a standard against which new mission and vision statements can be measured. Because all strategies and objectives arise from mission and vision, aligning them with the value statement ensures value-driven organizational action.

By setting forth what a company stands for -- its character -- the value statement defines organizational culture. When everyone must adhere to core values, the common commitment promotes unity of purpose and builds company identity. The statement enables this process by telling employees what is right and wrong, helping them determine actions and standards that will gain approval and promote success. To ensure values are more than just words, a company can make the statement part of its organizational life through rituals and practices that revolve around values. These might include awards, competitions and gatherings.

The core values in a small company usually are those of its founders. As a company grows, management inherits the values and may decide to codify them in a value statement. When doing so, it's wise to determine and describe values already driving company behavior rather than inventing new ones. If company values are less than worthy and management does need to institute new principles, leaders must remember that simply issuing a value statement will not promulgate values throughout a company. Values must become part of an organization's life.