I recently took a trip to San Francisco and met with two companies, the first, a solar client, the second, the main SF Bloomberg office down on the wharfs. Both have open office environments. The solar company has low cubes for everyone including the CEO, and each conference room has floor-to-ceiling glass walls so any passers-by can see what’s happening inside. Bloomberg has an even more open environment, long tables of workstations with employees lined up before four screens each, a TV production area in the open center aisle surrounded by employees, and recording devices to capture what happens inside each conference room.
My first reaction coming from more traditional East Coast layouts was: Isn’t all this noisy. A deeper part of me wondered if such supposed transparency was driven by an Orwellian instinct to listen in on employees, avoid legal risks, etc. But I noticed something else — all the employees were more courteous than I’ve seen elsewhere. A spirit of shared professionalism was breathable in the halls. My Bloomberg friend and I chatted about tech column ideas and segued into a few colorful stories about sex, knowing that the conversation was going on tape. Who cared? The environment encouraged pure honesty.
The challenge with corporate values is like all intangibles, initially they are hard to tie to external customer demand or internal profits. Customers of that solar firm or readers of Bloomberg can’t see initially that the employees inside are acting more honest, more courteous, more respectful with each other, so “values” may not jack sales or readership. But that “value” bubbles up in productivity, idea generation, and service expansion in ways that help make such companies more competitive.
Corporate values in my mind are the fitness test of the production body, and when it comes time for the competitive race, companies that are more fit will perform better. Any company can optimize for itself in the short term by cutting corners and ethics, getting a bump in this quarter’s profits. Values recognize the deeper truth that the corporate, corporeal body really does not exist, and instead is a fiction filled with human beings whose ethical performance is tied to the product output. We’ve seen what happens to market ecosystems when values break down — housing bubbles, near-catastrophic financial collapses. The same lack of values can damage smaller corporate bodies.
It all comes down to motivating the real humans who make or serve things to perform, both for profit and for organizational strength. What is the value of “values”? What is the value of being surrounded by 100 honest, motivated, ideating, empowered, nimble, fast, trustworthy people who are pulling together in a common purpose? The second question answers the first.
Investments in fitness never pay off in the first day, but they do over the long haul.
(A response inspired by Gunther Sonnenfeld’s brilliant post on corporate ethics.)
Image: Sergio Tudela Romero