by Marshall Goldsmith
Those plaques on the walls! Those inspiring mottos! Companies have wasted millions of dollars and countless hours agonizing over buzzwords and slogans that are hung on walls. There is a clear assumption that people’s behavior will change because the pronouncements on plaques are “inspirational” or certain words “integrate our strategy and values.” There is an implicit hope that when people – especially managers – hear great words, they will start to exhibit great behavior.
Sometimes these words or phrases morph as people try to keep up with the latest trends in corporatespeak. A company may begin by striving for “customer satisfaction,” then advance to “total customer satisfaction,” and then finally reach the pinnacle of “customer delight.”
Enron Talked a Good Game
But this obsession with words belies one very large problem: There is almost no correlation between the words on the wall and the behavior of leaders. Every company says it wants “integrity,” “respect for people,” “quality,” “customer satisfaction,” “innovation,” and “return for shareholders.” Sometimes companies get creative and toss in something about “community” or “suppliers.” But since the big messages are all basically the same, the words quickly lose meaning for employees.
Enron is a great example. Before the energy conglomerate’s collapse in 2001, I had the opportunity to review Enron’s values during a meeting with its senior management team. I was shown a wonderful video on Enron’s ethics and integrity. I was greatly impressed by the high-minded beliefs the company espoused and the care that was put into the video. Examples of Enron’s good deeds in the community and the professed character of Enron’s executives were particularly noteworthy.
It was one of the most smoothly professional presentations on ethics and values that I have ever seen. Clearly, Enron spent a fortune “packaging” these wonderful messages. It didn’t really matter. Despite the lofty words, a number of Enron’s top executives either have been indicted or are in jail.
J&J Adheres to its Credo
The situation couldn’t be more different at Johnson & Johnson (JNJ), where I had the opportunity to work with that company’s top 2,000 leaders. The pharmaceutical company is famous for its “Credo,” which was written many years ago and reflects the sincere values of the leaders of the company at that time. The J&J Credo could be considered rather quaint by today’s standards. It contains several old-fashioned phrases, such as “must be good citizens – support good works and charities – and bear our fair share of taxes” and “maintain in good order the property that we are privileged to use.” Like most values statements, it conveyed a great message, but it had none of the slick PR packaging that Enron’s did.
Yet, even with its less-powerful language and seemingly dated presentation, the J&J Credo works – primarily because over many years, the company’s management has taken its values seriously. J&J executives have consistently challenged themselves and employees not just to understand the values, but to exhibit them in their day-to-day behavior. Whenever I conducted leadership training for J&J, one of its most senior executives would spend many hours with every class. The executive’s task was not to talk about compensation or other perks of J&J management; it was to discuss living the company’s values.
My partner, Howard Morgan, and I completed a study of more than 11,000 managers in eight major corporations. We looked at the impact of leadership development programs in changing executive behavior. As it turns out, each of the eight companies had different values and different words to describe ideal leadership behavior.
But these differences in words made absolutely no difference in determining the way leaders behaved. One company spent thousands of hours composing just the right words to express its view of how leaders should act – in vain. I am sure that the first draft would have been just as useful. In our study we found that leaders who took training and feedback seriously, made a personal commitment to improvement, and followed up with their co-workers became more effective. Leaders who just listened to the talk but took no action or made no commitment improved no more than those who hadn’t even heard the talk.
Actions Speak Loudest
Companies that do the best job of living up to their values and developing ethical employees, including managers, recognize that the real cause of success – or failure – is always the people, not the words. Rather than wasting time on reinventing words about desired leadership behavior, companies should ensure that leaders get (and act upon) feedback from employees – the people who actually observe this behavior. Rather than wasting time on changing performance appraisal forms, leaders need to learn from employees to ensure that they are providing the right coaching.
Ultimately, our actions will say much more to employees about our values and our leadership skills than our words ever can. If our actions are wise, no one will care if the words on the wall are not perfect. If our actions are foolish, the wonderful words posted on the wall will only make us look more ridiculous.
(This column has been modified from a piece that originally appeared in Strategy+Business, Summer, 2005.)