VITAL VALUESLeo Hauska

23.04.2009

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Why are we talking about

values?

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VALUE & VALUES

Focusing on what matters, on valuable things, on values.

Value/s as t h e orientation during any transition.

Creating value through values.

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TODAY‘S AGENDA

(1) Issues

(2) Trends

(3) CEO‘s Positions

(4) Opportunities

(5) The Role of HR

(6) Threats

(7) Options to Start

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ISSUES WITH VALUES

It‘s a very personal issue!

We are not priests but

businessmen.

Ethical values cannot be managed.

We don‘t have any tool for measuring.

Nobody is in charge.

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ISSUES WITH VALUES

We have it since decades.

There are too many different

people.

There are always the same values.

It‘s written down.

We live it anyway.

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ISSUES WITH VALUES

Booz Allen Hamilton and the Aspen Institute, 2004:Global study of corporations; 30 countries, 365 companies:

Values Included in Corporate Values Statements:

Ethical behavior/integrity…….. 90%

Commitment to customers….. 88%

Commitment to employees….. 78%

Teamwork and trust………….. 76%

Commitment to shareholders.. 69%

Honesty/openness…………… 69%

Accountability………………… 68%

Differentiation

•Social responsibility………………… 65%•Innovativeness/entrepreneurship… 60%•Drive to succeed……………………. 50%•Environmental responsibility………. 46%•Initiative……………………………… 44%•Commitment to diversity…………… 41%•Adaptability………………………….. 31%

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ISSUES WITH VALUES

Example: Hauska & Partner

Instead of „customer orientation / customer satisfaction“:

CONTRIBUTION DEDICATION & PASSION

EXCELLENCE

RELIABILITY DIVERSITY

Provide the best consultancy,tangible/intangible benefits

Identification with clients, loyalty & energy

Highest standards, ongoing development, innovation

Responsibility & trust Appreciating differences

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ISSUES WITH VALUES

•The group's values are:

•Result-oriented - we want to achieve good results in everything we do

•Open - we are transparent and open in our communication

•Innovative - we are willing to learn new things and change

•Committed - we are jointly builiding a sustainable business

Example:

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VALUES MANAGEMENT TRENDS

Values Managementis one of the

biggest opportunitiesif we do it right.

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VALUES MANAGEMENT TRENDS

Booz Allen Hamilton and the Aspen Institute, 2004:Global study of corporations; 30 countries, 365 companies:

89% Written values statements

75% Significant pressure to demonstratestrong corporate values.

„More and more companies … are questioning … their ability to … reinforce values that benefit the firm … and the wider world …

… more firms are taking action to turn their corporation‘s values into a competitive asset.“

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VALUES MANAGEMENT TRENDS

Most companies believe values influence relationships and reputation but do not see the direct link to growth – however:

Top performers connect values and operations!

Practices to Reinforce Values:

85% Explicit CEO support

81% Corporate values statement

77% Performance appraisals

74% Internal communications

72% Training

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VALUES MANAGEMENT TRENDS

Values Management:Aligning Employee Values and Organization GoalsLaurie E. Paarlberg, San Francisco State UniversityJames L. Perry, Indiana University–Purdue University, Indianapolis

© 2007 Sage Publications

“Values management as a social processthat influences individual behavior

and organization performancethrough shared values systems.”

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VALUES MANAGEMENT TRENDS

Communicating “the values of the organization” is not enough.

Employees are motivated by societal & cultural values.

Success factors:

Employees respond to organization values within a “zone of existing values”.

Middle managers play key roles as “integrators”.

Aligning values requires routine interactions between employees, managers – and other stakeholders.

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VALUES MANAGEMENT TRENDS

INDIVIDUALVALUES

ORGANIZATIONALVALUES

SOCIETALVALUES

ECONOMICVALUES

VitalValues

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CEO‘s POSITIONS

“Corporate Values helped save Xerox during the worst crisis in our history.

Living our values has been of Xerox’s five performance objectives for the past several years.”

Anne Mulcahy

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CEO‘s POSITIONS

"The only thing that works is management by values.

Find people who are competent and really bright, but more importantly, people who care exactly about the same things you care about."

Steve Jobs

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CEO‘s POSITIONS

“Leading by values is … empowering. Rather than burden our people with excessive controls, we are trusting them to … act based on values … they themselves shaped.

… We have to innovate in ways that truly matter … by taking personal responsibility for all of our relationships - with clients, colleagues, partners, investors and the public at large.”

Samuel J. PalmisanoChairman, President and Chief Executive Officer

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CEO‘s POSITIONS

CEO Round Table 2008Multinational CompaniesRegional Headquarters:

Current Issues:

A broad variaty ofcost cutting programs

Pro-active strategies:

How can we link our company to the real needs of the society? How can we make our corporate culture inspiring for our key

people? How can we ensure sustainability?

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•„In our experience, corporate responsibility must be a driver of profitable growth.“

Roland BergerStrategy Consultants

•„Sustainable Development. Now is time for action, no further diagnosis.“

The Boston Consulting Group

OPPORTUNITIES

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OPPORTUNITIES

“Companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders.

It opens a way of managing change and of reconciling social development with improved competitiveness.”

EU Kommission, 2001: Green Paper

Corporate Social Responsibility

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OPPORTUNITIES

Spending money

Giving back to the society

Costs

Additional projects

Philanthropy

Sponsoring

Charity

Welfare

Earning money

Improving the competitiveness

Investment

Core business

Corporate Strategy

Innovation

Sustainability

Public-private-partnership

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OPPORTUNITIES

STAKEHOLDER

maximizeopportunities

minimizerisks

re-active

pro-active

VISIO

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VALUES

CORPORATION

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Organizations are embedded in the society and the entire environment ….

OPPORTUNITIES

ORGANIZATIONSORGANIZATIONS SOCIETYSOCIETY ENVIRONMENTENVIRONMENT

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.... and depend on these fundaments. Therefore, efforts should not be directed against it, but strengthen it.

OPPORTUNITIES

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The best way to do it: relationships with relevant people and organizations outside the company („external stakeholders“) ….

OPPORTUNITIES

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.... to identify the most important issues and to work on them together.

OPPORTUNITIES

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This enables win-win-situations, prevents crisis, but also opens new business opportunities.

OPPORTUNITIES

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The success factor: a new level of stakeholder relations that includes a dialogue on values and an openess for collaboration.

OPPORTUNITIES

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THE ROLE OF HR

CFO

CEO

HR PR

• Monitoring• Issues Management• Stakeholder Relations• Internal & external

Communications

enable co-operative relationships

• Personal Development• Appraisal System• Training• Recruitment

• Organizational Communications

empower & encourage peopleto shape and to live corporate values

• Controlling of Key Performance Indicators• Financial & Non Financial Reporting

ensure economic sustainability

VALUETHROUGHVALUES

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THREATS

From „customer satisfaction“ to „total customer satisfaction“ and „customer delight“

Sustainable is becoming one of the most used attributes

We have to use communication for defining values, sharing values, organizing and enabling all necessary interactions to live values – but as less as possible for promotional purposes.

Too much focus on communications

CSR MANAGEMENT

PUBLIC RELATIONS

“If CSR becomes all about PR and spin, then it won't be about changing the way

business behaves in the world.”PRWeek, 2004

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THREATS

Credibility

Annual Report 2008

Professional ethics govern our actions as a company.

A good corporate reputation is a company’s most valuable and competitive asset. It is directly linked to

uncompromising compliance with applicable laws, regulations and internal guidelines. Compliance is thus a central pillar of our management and corporate culture and, at the same time, an integral part of all business processes. Achieving outstanding performance and maintaining the highest level of ethical integrity is certainly not a contradiction. On the contrary: this mindset and approach have made Siemens strong. Our message is clear and straightforward:

Only clean business is Siemens business.

•With

CSR

CSR

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THREATS

Fear?

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4 OPTIONS TO START

Code of ConductDefining the corporate values

and link them to value

Stakeholder MapKnowing values & expectations

of your counterparts

Issues IndexPrioritizing the issues you have to deal with

Reporting SystemShaping the framework for your values management

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1 - VALUES MANAGEMENT

Identification and interpretation of the relevant values of your company

Tools: Research, presentations, workshop, WorldCafé, etc.

Result: Unique set of values, “DNA” of your company

Success factor: Top-down and bottom-up approach

Code of ConductDefining the corporate values

and link them to value

Code ofConduct

Code ofConduct

Samuel J. Palmisano:

“For 72 hours last summer, we invited all 319,000 IBMers around the world to engage

in an open "values jam" on our global intranet. IBMers by the tens of thousands

weighed in.”

Samuel J. Palmisano:

“For 72 hours last summer, we invited all 319,000 IBMers around the world to engage

in an open "values jam" on our global intranet. IBMers by the tens of thousands

weighed in.”

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2 - STAKEHOLDER MANAGEMENT

Identifying and analyzing relevant people / organizationsOverview about the people you should deal with Tools: Screening, Mapping, AnalyzingResults: Stakeholder Map, Stakeholder Manual, Guidance for Stakeholder RelationsSuccess factor: openess, neutral/external point of view

Stakeholder MapKnowing values & expectations

of your counterparts

StakeholderManual

StakeholderManual

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3 - ISSUES MANAGEMENT

Identifying and prioritizing of current trends and issues

Basis for scenario development and strategic recommendations

Tools: Screening, analyzing

Results: Overview about / ranking of all relevant issues

Success factor: methodology of analysis, time

Issues IndexPrioritizing the issues you have to deal with

ISSUESINDEX

ISSUESINDEX

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4 - CSR MANAGEMENT

CSRReport

CSRReport

Reporting SystemShaping the framework for your values management

Establishing reporting structures

Using existing standards (Global Reporting Initiative)

Managing Values in the broader context of responsibility & sustainability

Tools: According to reporting guidelines

Results: CSR Report

Success factor: Using standards

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Many valuable strategies are required….

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Hauska & Partner Latvia

Antonijas 20bRiga LV 1010

Tel: +371 6761 0010

www.hauska.com

Hauska & Partner Group

Kärntner Strasse 21-231010 Vienna, Austria

Tel: +43 1 513 1700

www.hauska.com

leo.hauska@hauska.com