Why is “value” important and what is it?

Who can’t agree that “value” as a concept is central to growing our businesses—capturing market share, improving margins. But what the heck is “value”? But how can such a subjective concept be so central to our economic success, and yet so misunderstood and so difficult to replicate?

If you want a useable answer, don’t ask an economist. Go find a philosopher.

Seriously. Find a philosopher, perhaps one familiar with Immanuel Kant, whose explanations helped me actually get a grasp of what I intuitively always knew, but could never explain without seeming like a blithering idiot.

The key to understanding is, as it turns out, intuitively simple. It just requires us to drop our spreadsheets for a while and get abstract—to use that which causes us, you and me, to feel good about ourselves. And just as night follows day, to recognize that bad coexists with good and how ignoring that fact only gives you half the answer.

First, let’s recognize that “Value” is a Good thing. Capital “G” good. Not a good thing like, “Wow, this chainsaw cuts really well, it’s a good chainsaw” That is a practical, utility-based sense of good. Lower case “g” good.

Okay, how many kinds of good are there? Just two for our purposes here.

An “Instrumental Good” is good for something. Like that chainsaw. It’s transient, it is “Good for today.” A better product, say an improved chainsaw with laser beams, may come along tomorrow which measurably diminishes the previous ones instrumental “good”-ness, its practical usefulness. For example, the Telegraph was once a huge Instrumental Good which long since lost it’s practical value.

An “Intrinsic Good” is always future-based and fixed in it’s worth. And that worth is very high. You might say, “it was a Good thing yesterday, and will be tomorrow and forever”. This kind of “Good” ( or value, or character, or trait, or virtue) is simply Good in-and-of-itself. You don’t argue with it, you can’t argue with it because it’s what you believe. It is part of who you are, and we very seldom argue successfully against our own values.

Love is this kind of Good. The same goes for Truth, Beauty, Justice, Compassion, etc.

Sounds fairly abstract doesn’t it? Well, let’s take that last one, Compassion, to illustrate how this seemingly high-minded worldview can be useful to businesses in search of understanding and advantage.

If you’ve ever sat on hold for 45 minutes to get a product problem resolved, only to be told” Sorry, can’t help you”, or “Not my department” you know the feeling that ensues: For most of us it goes beyond frustration into anger. For those times we’ve destroyed a day waiting for the cable guy, only to have him not show up at all, well that moves things into capital “A” type anger.

Why?

Because you’ve been worse than disrespected. You’ve been insulted. Someone has implicitly said, “Your needs are not important.” Your feelings are irrelevant, your humanity is taken away from you: nobody cares. The visceral response for many customers at this point could hardly be stronger if someone had called their mother nasty names. Now, if you’re not the recipient of this service nightmare you might be tempted to say “Hey, why so mad—it’s only cable TV, or a moldy loaf of bread, or….” The reason? Because this time, it’s not business, it’s personal. The kind of emotion involved here could be called an Intrinsic Bad. Anger is just that. We respond because our personal sense of justice has been abused. An Intrinsic Good shared by all, Justice, has been violated. It goes without saying that this cycle is not one we wish to see inflicted, never mind repeated, in our business operations.

Luckily, there’s an antidote and it has nothing to do with a barrage of memos, threats or incentive plans you can devise. It’s another Intrinsic Good: Compassion.

Yeah, I know: Huh? Stop for a minute and think of a time when someone offered you an unexpected kind gesture. Maybe they stopped to hold the door for you, or let you merge into traffic when nobody else would. Maybe they thought ahead for you, and you benefited, and you didn’t even have to ask. At those moments, the hair on the back of your neck stands up, doesn’t it? Physiologically speaking, endorphins in your brain trigger that feeling, that rush.

The cause for the good feeling? That’s Compassion talking. Someone has validated your sense of Justice and your Faith in your fellow humankind. (Yes, Faith is an Intrinsic Good.) Someone has recognized your needs, your value as a person: you merited someone else’s sincere interest and effort. And you really liked it.

Imagine that feeling harnessed in service of your efforts

Compassion is a big Intrinsic Good and its experience is common to all of us. It’s also the central element to one of the most dangerous or rewarding aspects of our business efforts: Service. Yet Compassion is nebulous, isn’t it? How do you measure the hair on the back of customers’ necks? Manage it? Mandate it?

Easy, talk about it. Relate its relevance and power in real terms. Make it a central value of your organization. Not by mandating or formulizing it. That would be impossible. However, making it “happen” is not.

Talk about intrinsic goods like compassion and their place in your plans. You can incorporate them by shifting the language and expectations of what your company is about and how its members evaluate themselves. Remember what we said about skipping the economists? They’re really gonna hate this part: invite your people, all of them, to write company strategy and policy based on Intrinsic Goods. Have them craft a Shared Purpose that uncovers the things that can make their company, and their actions as employees, an intrinsic extension of their own personal ambitions and beliefs. The benefits are many, and you’ll be surprised to learn that, as a recent business book title goes, Pride means more than money* to your people. And, as you're guessing by now, work has a metaphysical vocabulary. Yeah, Faith does move mountains. But mostly because it inspires people to bring shovels, buckets, spoons and, even, to loan you their dump truck. Or, at least, rent it to you at cost.

The truth is, numbers are inherently “unsticky” as human motivators today. Even CFO Magazine is slagging off "best practices" as death senstences for innovation and growth. CIO magazine, via author Nick Carr is saying things like "Why IT doesn't matter." Anyone familiar with crusty Abraham Maslow and his hierarchy will inherently understand why this has been so for quite some time. Meaning is the real currency—for customers and employees alike, and things like Merit, Energy, Ambition, Truth, Purpose and Community count far more than TQM, ISO or 6-Sigma. The flavor of the month financial and management gimmicks are tools—transient Instrumental Goods—like that chainsaw or the Telegraph: They’re good today, and hairy goats tomorrow. We fall in love with them, then disregard each because, in the end, they ask and answer the wrong questions and rapidly lose their edge.

How do they lose it? Since they promote immediate gain at the expense of human connection and those vital Intrinsic Goods, they end up asking for interest and energy we won’t commit fully because instrumental things can’t touch those affirmative values that say “I’m becoming a bigger, better me” by working for or trading with company XYZ.

Yes, tools and results matter. But as leaders we have to walk a fine line between execution and inspiration. We are not our tools. When we forget this we become one-dimensional, one-note and inert. That’s intrinsically Bad because employees and consumers can smell in-authenticity a mile off.

We’re in one of those phases right now: Profits are growing, job horizons are not; expedience rules and it’s making everybody antsy. Never fear, it’s not the first time. History proves that the Bad forces out the Good for a while, and the lesson is learned, forgotten and relearned, just as night does follow day. Out go Conglomerates, Junk Bonds, S&Ls, Andersen, Enron, Tyco and outsourcing, In come the Ethics Seminars and the articles about getting back to basics—doing well, by doing Good. Capital "G" good

The only question is, are you in? Or out?