An Old Write Up....Toward A Corporate Identity

I wrote this up a couple of years ago while working for Dad, it's still helpful for me in how I approach business. Not everything here is transferable to a ministry setting, but hopefully it can help stimulate what we were talking about. D-Bro, will also have more to add on this I am sure. Beware, this is a bit long....

We are currently in the process of searching out and articulating who we are, which may well be the most important undertaking of our young company. The sages of ancient Greece placed this charge before all who would seek their wisdom – Know Thyself. In ancient times as well as today clarity of purpose and potency of mission flow from a healthy sense of self-awareness. In Built to Last, Collins and Porras poignantly state, “it is far more important to know who you are than where you are going, for where you are going will certainly change as the world about you changes.”[i] However, our identity is not merely a static understanding of the idea of “this is who we are”, but rather who we are is a dynamic reality, encompassing the notions of “this is what we value”, “this is why we exist”, “this is what we do”, and “this is where we are going.” These concepts can be broken down into three broad categories: Core Values, Purpose, and Vision, which together comprise our identity. It is important to wrestle through these concepts in order, because in answering one, the next can be approached competently and confidently.

1. Core Values:

Explanation:

Core values are the heartbeat of a company. These, if they are of any worth at all, are the fiercely held beliefs that pervade everything the business is and does. Collins and Porras define core values as “the organization’s essential and enduring tenets, not to be compromised for financial gain or short-term expediency.”[ii] These values are internal, to be held by the company itself, irrespective of external influence or demands. They are to be held by the company even if it were in a different industry, or even if the market were to penalize the company for holding these values. To fall short of this is to have weak, inoperative values that expose the company to all kinds of internal hypocrisy.

The values of a company are not conjured, or fabricated, they are discovered. Here are some questions that can be helpful in unearthing these values:[iii]

· What values do you bring to work that are so important to you that you would hold them even if you were not rewarded for holding them?

· What values do you bring to work that you would want to instill in your children as they move into their careers?

· Would you live your life and run your company by these values if money were not an issue?

· If circumstances penalized you for holding these values, would you hold them regardless?

· Will these values be as valid 100 years from now as they are today?

· Would you hold these values if you were in an entirely different line of business?

As these values are articulated you should notice that your beliefs that can be truly considered core occupy a short list. Somewhere between three to six core values is a good rule of thumb. To go beyond this is to include values, however good they may be, that cannot reasonably be considered “core.”

Examples:

DPR: [iv]

· Integrity – We conduct all business with the highest standards of honesty and fairness; we can be trusted.

· Enjoyment – We believe work should be fun and intrinsically satisfying; if we are not enjoying ourselves we are doing something wrong.

· Uniqueness – We must be different from and more progressive than all other construction companies; we stand for something.

· Ever Forward – We believe in continual self-initiated change, improvement, and the advancement of standards for their own sake.

EFCC: [v]

· Evangelizing the lost is God’s “heartbeat” – Therefore, we will aggressively proclaim the gospel locally and internationally.

· Spiritual maturity is God’s design for every believer – Therefore, we will strive to grow in Christlike love and care for each other, serving in our area of spiritual giftedness.

· Worship is God’s desire for His people – Therefore, we will respond to God’s presence with us in all life’s circumstances.

· The Bible is God’s Word, relevant and sufficient for every generation – Therefore, we will follow the Scriptures as our only rule of faith and practice.

· Prayer releases God’s power for ministry – Therefore, we will pray regularly for the ministry effectiveness of Emmanuel Faith Community Church.

Rationale:

Simply stated, companies, organizations, churches, and institutions will succeed or fail based on their fidelity or lack thereof to their core values. From operations to employees, vision to objectives, the core values should inform and be reflected in everything the company is and does. Conversely, anything that does not fit within the core values of the company should be expelled, no matter who or what that may be. However ironic it may seem given the most recent rash of corporate scandals, corporations that achieved and have sustained greatness rarely if ever compromised or changed their core values, rather they vigorously maintained their businesses within their tightly held beliefs and values.[vi] So the importance of values cannot be gainsaid. For the purpose of illustration Aubrey Malphurs lists nine helpful reasons as to why values are important: [vii]

· Determine [corporate] distinctives

· Dictate personal involvement

· Communicate what is important

· Embrace good change

· Influence overall behavior

· Inspire people to action

· Enhance credible leadership

· Contribute to [corporate] success

· Influence [corporate] purpose and vision

Purpose and vision cannot be properly addressed with a vague sense of values, because there is no constant anchor to steady them in a constantly changing world. It must also be emphasized that if the exercise of articulating values results in empty rhetoric, that exercise is more damaging than helpful. However, without trying to sound redundant, to discover and diligently instill our core values in the company, from top to bottom may well be one of the most important things we ever do.

Purpose:

Explanation:

Purpose answers the two soul-wrenching questions that humans have wrestled with from the individual to the corporate levels since the dawn of time: “why do we exist?” and “what do we exist to do?” Hence purpose is like a two-sided coin being both ideological and functional. What is also peculiar to purpose is that it is very concerned with direction but remarkably unconcerned with a particular destination; it is about the journey itself, not about arriving. This is not to say that the notions of destination and arrival are not crucial components to an overall corporate identity (which will be appropriately addressed in the discussion on Vision), but that they are not the emphasis of Purpose. With this in mind, a clear statement purpose is in the end the product of answering the functional (“what”) and the ideological (“why”) questions. Although these issues are inextricably related, in the process of discovering purpose it can be quite helpful to address and define the two components separately before drawing it together in the end.

Function and Purpose –

While function may seem dispassionate and somewhat mechanical, it is indispensable to purpose, and as this discussion unfolds hopefully the glorious nature that exists at the heart of function will become clear. Function is concerned with propriety, the fulfillment of (in this case) a corporation’s designated role. To hold a purpose that is incompatible with a company’s designated role leads to dysfunction and ultimately destruction. An apt, and admittedly absurd example is if a hospital adopted for itself the profoundly inspiring purpose statement held by the crew of the Starship Enterprise, “To explore strange new worlds, to seek out new life and new civilizations, to boldly go where no man has gone before.” However inspiring it’s purpose, the hospital in question would be doomed to fail both in space travel and as a hospital because it’s designated role was never that of a spaceship it was that of a health care facility. Function for a business is a multivalent proposition, encompassing many layers. Businesses function on a broad societal level, fulfilling a generalized role, as well as more specific market, industry and customer levels.

Peter Drucker was the first to assert that businesses are truly organs of society, and more specifically socio-economic organisms whose societal responsibility is the generation of wealth and economic performance.[viii] Ironically however, for Drucker the specific, functional purpose of a business is not profit maximization, he emphatically states that this “concept is worse than irrelevant: it does harm”[ix] In spite of the audacity of this iconoclastic commentary, it may very well be one of Drucker’s most insightful and ultimately useful contributions to the philosophy of business. As he notes, the profit motive informs us of nothing when it pertains to what a specific business does or what its intended function is. For example a swashbuckling CEO of a coal mining company who asserts “we’re in business to make money” propounds an empty purpose that fails to clarify whether he runs a software company or a coalmine nor does it clarify what function his business fulfills (e.g. a coalmine functions to provide combustible energy in a variety of applications). Instead Drucker insists, “There is only one valid definition of [functional] business purpose: to create a customer.”[x] Without a customer a company ceases to be a business, because it is the customer who pays for a company’s goods and services. Profits from a functional standpoint serve more as a report card than a purpose, measuring how well a business creates and maintains a customer by satisfying the customer’s demands, just as a student is in school to learn, not to obtain a report card. The report card (at least in theory) serves to measure how well that student has performed in respect to his purpose – that is, how well he has learned. Purpose for a business draws the business outside of itself to fulfill its role in society and to its customers in the same fashion that learning draws the student from his limited knowledge base to a wealth of knowledge that exists outside of himself.

As a result, to uncover its own specific function a business must determine who its customers are and what goods and services it provides to its customers and the interrelationship between the two. Most businesses goods and services are supplied to more than one customer. For example a residential roofing subcontractor has to consider the general contractor, the developer, and ultimately the homeowner (end users) of his product all to be his customer. Therefore he must consider what each of these parties as customers need and want, and how his goods and services will satisfy those needs and wants. The general contractor wants the roofer’s services to be rendered in a timely fashion. The developer/owner may want the roof to fit within his price range among other wants. The homeowner may want the roof at a certain price or to possess a certain aesthetic. Additionally the homeowner needs the roof to be of sound structural integrity, and at the most primal level the end user needs the roof to fulfill its primary function of providing safe shelter from the elements. With this in mind it would be crudely prosaic and banefully shortsighted for the roofing contractor to say his business exists to build roofs. If this is his purpose he has ignored the crucial interrelationship between the customer and his goods and services. It is this interrelationship that strikes at the heart of function. The customer does not want a roof in and of itself he wants what the roof provides, what effect that roof has on him, and how the roof benefits him – he wants to be safe and secure under that roof primarily, and secondarily he wants comfort of knowing his roof compliments his house. If after carefully considering this intricate relationship the roofer states that his business exists to “efficiently and affordably provide families safe and comfortable shelters” he will demonstrate that he understands his customers (general contractor, developer, and homeowner) and their relationship to the goods and services that his company provides. While the process of uncovering a corporation’s true functional purpose may be somewhat mechanical, the heart of function should be inspiring and even glorious. The roofer could ask himself, what would the world be like if my business didn’t exist? At the very least it would obtain its shelter way behind schedule and way overpriced, at the very worst those of us who couldn’t find caves might well die of exposure. He ought to be inspired to make sure his company runs consistent with its true purpose because its true purpose is of inherent value, benefit, and worth.

Ideology and Purpose:

The inseparability of function and ideology ought to be becoming clearer. Function’s mechanical concerns for the propriety and benefit of the effect of a business are balanced out by the ideological concerns housed in the soul of a business. From an ideological perspective a businesses purpose is in perfect harmony of the beliefs and values it holds to be sacred. The beauty of the roofer’s well examined, functional purpose statement “to efficiently and affordably provide families safe and comfortable shelters” is that it simultaneously answers both what his business does and why his business exists. Most decent roofers would feel cheapened in their soul if the reason why they existed were merely to build roofs, even though at some surface level that describes what they do. But the purpose that is provided by their thoughtful owner ought to be deeply meaningful, highly functional, and extraordinarily inspiring. If not, they are either not cut out for roofing or they are working for the wrong roofer. The reason why businesses need purpose is because they are full of humans who by nature are creatures whose souls are ever in need of purpose.

Examples:

Here are some examples of purpose (or mission statements – the terms seem interchangeable):

· DPR – DPR exists to build great things.

· Westminster Catechism (pertaining to man’s purpose) – It is the chief end of man to glorify God and enjoy him forever.

· Israel (Modern State) – Israel exists to secure a place on Earth for the Jewish people.

· Hewlett Packard – HP exists to make technical contributions for the advancement and welfare of humanity

· Merck (Pharmaceutical) – Merck exists to preserve and improve human life.

Rationale:

“Purpose…is the organization’s fundamental reason for being”[xi] A purposeless business is not akin to a ship without sails, its akin to a ship with no bow, no stern, no hull…in other words, hardly a ship. It ought to be sufficient to say that the need for an appropriate, clear and compelling core purpose is self-evident; sadly in this world there are many businesses with either no purpose or the wrong purpose. However, for those businesses that operate from a true sense of purpose, as there is much compelling evidence to indicate so, true and lasting success is far more likely than for those without purpose.

Vision:

Explanation:

Vision, the very term evokes images of gray-haired, weathered men who carried upon their shoulders the weight of their times. Their visions were of terror and grandeur, so great in fact that those who saw these visions were undone even as they saw them.[xii]These images can make the idea of vision for a company both daunting and trivial. Does a CEO receive a vision from the Heavens regarding where his business is headed? Is vision in the business world today the product of unchecked ego and an over-inflated sense of what a business really is? After all some businesses really believe that they are on an endeavor of cosmic importance…isn’t business just business? Hopefully the explanation that follows will help to clarify what vision is and how it is attained.

What is vision? The answer should seem self-evident, but more often than not it is confused. Is vision a dream? A vague, undefined hope? The answer can be comforting; visions do incorporate hopes and dreams, and the human spirit’s inherent need to aspire. Vision is “a clear and compelling goal” or as Collins and Porras have popularized, a BHAG – Big, Hairy, Audacious Goal.[xiii] In describing the BHAG they say, “Like the moon mission, a true BHAG is clear and compelling and serves as a unifying focal point of effort – often creating immense team spirit. It has a clear finish line, so an organization can know when it has achieved the goal; people like to shoot for finish lines.”[xiv] A vision can start as a dream, or an unspoken but deep-seated hope, but these things often lack definition and clarity. Vision gives these shape, they point the imagination to something tangible. An athlete envisions the finish line, he knows what it looks like, he knows how he is going to feel when it has been crossed, he knows how he is going to direct his efforts in order to ensure that he will cross it victoriously. Jack Welch, CEO of General Electric, speaks of vision as a way for a company to “define its (envisioned future) in broad but clear terms. You need an overarching message, something big, but simple and understandable.”[xv]Therefore vision doesn’t need to take an hour to articulate, it should take no more than fifteen seconds, GE’s vision which they constantly aim for is to “Become #1 or #2 in every market we serve and revolutionize this company to have the speed and agility of a small enterprise.” This is GE’s BHAG, it is simple, but it requires all of GE’s energies to see it accomplished.

Vision is attained, then through a process of directed envisioning. It may start with hopes and dreams, but it is through the process of envisioning that the vision will become the unifying focal point of effort in an organization. Here is where the legacies of Built to Last and Good to Great have been left on the business world today. Collins and Porras have, through intense research drawn conclusions on corporate ideology and vision that are difficult to refute. Companies like DPR have modeled themselves after the ideas proposed in these books, and as a result have yielded great results while attaining a reputation of being revolutionary. Vision level BHAG’s as Collins describes should be set somewhere between ten to thirty years into the corporation’s future. He says this because it forces the company to think beyond their current capacities, environmental trends, and conditions. In short it forces the company to become visionary. From the outside vision may seem to be a product of foolish machismo, but internally, within the visionary company it flows from true understanding.[xvi] Envisioning is a two-fold process of soul-searching and forward thinking; it is internal and external. A company cannot have a vision that is incompatible with its purpose or values, nor can it have a vision that does not properly account for its current state. The vision comprises a well thought out statement that captures the envisioned future. For example, our imaginary roofer, as he goes through the envisioning process, may decide that he cannot be the best commercial roofer in the world, but he can be the best at residential track-home roofing. He realizes that he is passionate about building lasting relationships with his customers and employees and those in his community, and that through measuring his profits per house roofed gives him the best economic measure of his business (each of these three items comprise the Hedgehog Concept). Then from this envisioning process he states his vision: “in thirty years Ace Residential Roofers will the largest, most respected residential roofing contractor in the south-eastern US.” This vision statement gives a tangible idea of where the company is headed. The CEO of ARR then goes on to give Vivid Descriptions[xviii] of what this vision will look like when it has been accomplished. They might read as follows:

· ARR will seek out and cultivate customers who will be fiercely loyal to our services. Our General Contractors will be more than a contracting party, they will be our friends. Those who live under our roofs will be proud to know that it was built by ARR

· Our employees will be proud to know that they belong to the ARR family. They will be the best treated, best compensated, most competent, well-trained and productive employees in the industry.

· ARR will be an active participant in each community it works in through charitable donations, and volunteer service contributed by our employees.

· ARR’s methods of attaining profits will revolutionize the industry in terms of ethics and economic ingenuity.

Examples:

The following are examples of vision statements, some include vivid descriptions:

· DPR[xix]

Vision

To be one of the most admired companies by the year 2030.

Vivid Descriptions

· Over the next 30 years our people practices will be recognized as being as progressive and influential as Hewlett Packard's were over the last 50 years.

· When it comes to quality and innovation, we will do for the Construction Industry what Toyota did for the Auto Industry.

· We will have created a brand image that is as positive and consistent as Disney's.

· Like Microsoft and Sun Microsystems, our people and company will be known for being aggressive and "Bullet Smart".

· We will be as integral and indispensable to the communities we operate in as are The Boys and Girls Clubs and The Red Cross.

· We will consistently produce truly great results and financial returns comparable to the Most Admired Companies.

· Sony [xx]

· Vision: Become the company most known for changing the worldwide image of Japanese products as being poor quality.

· Vivid Descriptions: We will create products that will become pervasive around the world…We will be the first Japanese company to go into the American market and distribute directly… We will succeed at innovations like the transistor radio that American companies have failed at… Fifty years from now our brand name will be as well know as any on Earth…and will signify innovation and quality that rivals the most innovative companies anywhere…”made in Japan” will mean something fine not shoddy.

Rationale:

Why vision? A company can survive without one that is proven by the vast numbers of companies that do in fact make from year to year without vision. However, without some sort of vision that transcends the here and now a business will struggle to do anything but maintain. Vision functions to stimulate long term forward progress. A good vision can serve to inspire and guide a corporation toward future success. Vision ought to stretch, but it also ought to be accomplished. Once it is accomplished, a new vision should arise to avoid what can be the most lethal virus in a business: complacency. The most successful companies have found ways to perpetually stimulate forward thinking and forward progress, and have found that through this stimulation they have indeed become great businesses.

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[i] Jim C. Collins, Jerry I. Porras; Built to Last; p. 221 (2002; Harper Collins; New York, NY)

[ii] Built to Last; p. 73

[iii] These concepts can be found in Built to Last; pp.223-224

[iv] These stated values can be found at http://www.dprinc.com on the page titled “Our Philosophy”

[v] See Emmanuel Faith Community Church Constitution and Bylaws

[vi] Built to Last, and Good to Great present vast and compelling evidence that demonstrates this very point.

[vii] Aubrey Malphurs; Advanced Strategic Planning; p.84 (1999; Baker; Grand Rapids, MI)

[viii] Peter F. Drucker; The Essential Drucker; pp. 14-17 (2001; Harper Collins; New York, NY)

[ix] The Essential Drucker; pp. 18-20

[x] The Essential Drucker; p. 20

[xi] Built to Last; p.224

[xii] See Isaiah 6:1-6

[xiii] Built to Last; pp. 93-4

[xiv] Built to Last; p. 94

[xv] Built to Last; p. 95 – parenthesis mine

[xvi] Jim Collins; Good to Great; p. 202; (2001; Harper Collins; New York, NY)

[xviii] Built to Last; pp.232-239

[xix] These stated values can be found at http://www.dprinc.com on the page titled “Our Philosophy”

[xx] Built to Last; p. 237