One Company’s Values Journey, Part II

Luck-02This week I continue my interview with the Luck Companies Chief Leadership Officer, Mark S. Fernandes. Mark is the person charged with transforming Luck Companies into a Values Based Leadership organization.

Last week we learned about the genesis of Luck Companies’ decision to change its culture. In 2004, senior leaders crafted four values – leadership, integrity, commitment, and creativity – and defined corresponding behaviors for each of those values. That was phase one, the foundation of Luck Companies’ transformation into a values based organization.

In 2009, senior leaders came to the conclusion that organizational cultures are shadows of the leaders. To have the culture that they wanted, Luck Companies’ leaders had to go first, modeling the way as an example for all others to follow. That was phase two, which they’re still engaged in.

I told Mark I loved the emphasis on defining their company values in measurable, behavioral terms. Mark said, “This became obvious to us in the first months of phase one. When we rolled our new values out to the company in 2005, outcome statements and corresponding behaviors were attached to each of the four values. These became part of every associates’ performance reviews that year.

In phase two, those behaviors became part of the Values Based Leadership 360 that all formal leaders complete annually.”

Accountability for values is much easier when you’ve defined specific behaviors for desired values. Typically when a company sets new values expectations, some leaders and players just don’t fit in the “new culture.” I asked Mark if Luck Companies’ had experienced that. Mark said, “We typically have 12-14 people on our senior leadership team. Over the past 11 years we have ‘lovingly set free’ eleven senior leadership team members.

Most were very smart people. They were wonderful human beings who performed quite well. It just became obvious by their attitudes, actions, and behaviors that their personal values did not align with the company’s values.”

If you’re not going to hold everyone accountable for valued behaviors, “your values are just words hanging on a wall,” Mark explained. “You’re better off not having them.”

How do leaders at Luck Companies know their culture is on track? Mark said, “We analyze trend data from our annual leader 360’s and our annual associate engagement surveys. We hold ‘What’s on Your Mind?’ sessions at all locations throughout the year.

We demand transparency and feedback. We train for it, assess for it, and reward for it through out evaluation process. There is daily dialog across the enterprise relative to our mission and values – our organizational constitution.”

The big question for any company and it’s culture is about the “big three” – engagement, service, and results. Culture impacts each of these, deeply. Mark said, “The impact of Values Based Leadership has far exceeded our expectations. In our most recent engagement survey, 91% of our associates said they were engaged! The Hay Group’s global average is 30-40%.

Our employee effectiveness score was 84% compared to the Hay Group’s top performing benchmark of 55%. Our customer satisfaction score is 76% compared to an industry norm of 55%. Our results show us outperforming industry norms by similar margins.”

I’m inspired by the work Mark and his peers are doing at Luck Companies. They are proof that being intentional about values pays off – in many ways.

I’m indebted to Mark and to Megan Dougherty who willingly and ably facilitated this interview.

What are your takeaways from the Luck Companies’ values journey? Share your insights on Twitter, Facebook, LinkedIn and Google +.

How healthy is your team or company’s culture? Don’t guess – get the data with my online Culture Effectiveness Assessment.

Want hands-on guidance for boosting productivity while reducing drama at work? Join me in Denver for my Culture Leadership Roundtable. This series, based on my book, The Culture Engine, meets one-morning-a-month starting in March.

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