A Thriving Company Culture Requires Truth in Leadership
In today's competitive business landscape and volatile macroeconomic environment, a healthy company culture is essential for achieving long-term success. A healthy company culture is a competitive advantage and separates the best from the rest. This has been the finding of many studies and has just recently been confirmed by McKinsey after it researched more than 1,000 organizations. In our experience, healthy company culture is built upon four key ingredients: purpose, vision, values, and behaviors.
Purpose is the reason why an organization exists beyond just making money. A clearly defined purpose can inspire employees and help them understand how their work is meaningful. Vision describes where the organization is headed and what it hopes to achieve. A compelling vision can align employees' efforts toward common goals and inspire them to work together to achieve success. Values are the guiding principles that define an organization's culture. When an organization's values are clearly defined and communicated, employees understand what is expected of them and how everybody works together. Behaviors are the actions that employees take to turn purpose and vision into reality.
A healthy company culture is the result of all four ingredients being aligned: a meaningful purpose, an inspiring vision, strong values, and behaviors based on these strong values. In our experience, however, there is one additional aspect that is often neglected: truth in leadership. Company culture will only be healthy if it comes together with truth in leadership. Truth in leadership means that the leader truly embraces the company's purpose and values and lives up to them.
A few examples that show how truth in leadership amplifies company culture and how a lack of truth in leadership destroys it:
As to purpose:
If a company pursues the bigger purpose of reducing global food waste and food loss, truth in leadership is present if the leader prioritizes food waste reduction in his or her own company over short-term profits and behaves accordingly himself or herself. The leader acts as a role model.
In contrast, truth in leadership wouldn't be present if trust was a core value and the leader shared information that has been given to him or her by a team member subject to the condition that the leader does not share it with anyone else.
As to values:
If honesty and transparency are core company values, the leader can be a role model and amplify employee engagement and performance if he or she lives up to these values by always being honest and transparent, giving candid feedback and walking the talk.
If trust is a core value, a leader must never share information that has been confidentially given to him or her by a team member. With just one action that violates team values, these values can become just words that nobody is committed to living up to.
We are convinced that strong leadership can be mimicked for a certain while. But in the long run, employees will notice whether there is truth in leadership as reflected in the leader living up to the company's purpose and values. Truth in leadership is present if leaders:
Truly believe that the company's purpose is worthwhile
Craft a vision that reflects not only monetary goals but also and especially the deeper purpose in terms of why the company does what it does,
Truly embrace the company's values
Live up to purpose, vision, and values by consistently showing the respective behavior
A thriving company culture does not only require a compelling purpose, an inspiring vision, strong values, and employees who act upon those values. It also and especially requires truth in leadership in the sense of leaders who act as role models and align their values and behavior with the organization's culture.