Many companies have developed credos, brief statements of their corporate philosophies, that articulate basic company values, including ethical values. The panelists focused on the values statements used in their companies and commented on specific practical applications of these statements and their implications for ethics.
REMARKS BY DOMINIC GARDA
I would like to talk about three things: 1) what Lucent values mean to me, 2) how these values relate to my department and 3) what the conflicts are between these values.
Value: An obsession with serving the customer. As a development director I have two main goals each year. First is providing the best possible products and services to our end customers. Second, is carrying out this activity while managing expenses so they stay within a reasonable level. This coupled with the work of my peers who are responsible for sales/revenues will bring about success.
Value: A commitment to business excellence...speed, innovation and quality... For products I have found that quality is the most important aspect. Quality does not include reducing development intervals, but it does include meeting delivery dates we have committed. It also means providing products that accomplish what the customer needs with minimal problems. The combination of speed, quality and innovation (i.e., always looking for better ways to do activities), if appropriately channeled, lead to maximum profitability and growth.
Value: A deep respect for the contributions of each person to the success of the team... Without the team, we could have no products, no growth and we certainly would not be profitable. Integrity, candor, respect, accountability, etc. must be lived daily. These characteristics are core to our values.
Value: A strong sense of social responsibility. It is a must that Lucent be viewed as a positive company not only from an economic perspective, but also from a social perspective. While I am not involved with the many things Lucent does at the corporate level, it is clearly a value and I have strongly encouraged my department employees to support this. We have gone to minority schools and have supported daughters of employee visits to expose children to the sciences. Our values constitute a strong ethical statement. I could give examples of how Lucent as a whole "lives the values", but instead I'd like to focus on how these values relate to my department: 1) We have the values statement to use,
2) Upper management looks for objectives to be set across all four value areas, 3) Staff meetings with my superior focus on the three main organizational value areas: a) customer, b) business excellence and c) "people value added" (PVA).
Staff meetings exemplify how we run our local business. I spent yesterday at a staff meeting that lasted 9 hours and we discussed many important topics. With the strong focus all companies must have on profitability, one might think a large portion of the time would be spent talking about this. Contrary to this, we spent 30 minutes on financials, 3.5 hours on quality initiatives, 2 hours on people issues (including how we will work with the results of a recent employee survey), 1 hour on policy deployment, 1 hour on staffing and 1 hour on miscellaneous topics.
There has been a significant shift in focus over the past 3-5 years. Making money and customer satisfaction would have been the only topics discussed at a staff meeting in the previous years. Now we spend significant time on our people. I believe this shift in focus has helped our results in the financial and customer satisfaction areas in major ways.
This shift is broader than just topics covered in staff meetings. We now have initiatives defined whereby we work daily to improve the working environment and thereby satisfaction level of people. In return, we expect behavior consistent with Lucent values. We measure satisfaction two ways: through surveys conducted at the corporate level and by constant local feedback channels.
Obviously there are conflicts that could occur between our values. These might be: 1) Customer crises vs. planned initiatives for PVA. 2) Short term sales/revenue issues vs PVA events supporting local society. 3) Quality of product vs. delivery dates. This is normally more a perceived conflict than an actual one since these values generally align with each other.
When I have a conflict, what do I consider? First is always the customer and what the root of our issue is. If it is a significant short term issue, it will likely preempt PVA activities. If long term, a plan will be needed to balance the values. Second is profitability. New sales are also very high priority. They can also preempt PVA. But, each time, different from the past, I make a conscious decision on what will be impacted and how we will get it back on track later.
In summary, whether it is in tough customer meetings or in departmental activities, I find myself asking the same questions that fit the value statements. What are the customer implications?-the financial implications?-the people implications?
REMARKS BY ROGER CAMPBELL
Campbell began his presentation by inviting participants to play a values game.
Values Game Instructions: You are about to start a company and establish a belief system for this company. Belief systems are based on values. Your task is to rank order the values listed below in helping you establish a belief system for your organization. Place the number 1 by the most important value, the number 2 by the second most important and so on through the number 8.
Values to be ranked
Earnings ___ Golden Rule ___
People ___ Customers ___
Suppliers ___ Organization ___
Communication ___ Citizenship ___
This exercise is given to new managers and supervisors. It is surprising how many will say we have to have earnings. If you don't have earnings you can't survive. Others say: You know what?-it takes people to make things happen and if you don't have good people, you can't make good earnings. They go on down the list and say. I can stand up here and fight for my ranking. What we are trying to do is have these people see how each one of these values contribute to Worthington Industries and the success of the organization. We also want them to see how these values contribute to individual success. Invariably, the training groups come to the realization that all of the values are equally important for survival. They end up talking about a synergy wheel in which the individual values are the spokes. If one is weak, you are going to have a bad wheel. It will collapse at that spot.
These values are the basis for the philosophy of Worthington Industries. We have this philosophy printed on small plastic cards and given to all employees.
Worthington's Philosophy
Earnings The first corporate goal for Worthington Industries is to earn money for its shareholders and increase the value of their investment.
We believe that the best measurement of the accomplishment of our goal is consistent growth in earnings per share.
Our Golden Rule We treat our customers, employees, investors and suppliers as we would like to be treated.
People We are dedicated to the belief that people are our most important asset. We believe that people respond to recognition, opportunity to grow and fair compensation. We believe that compensation should be directly related to job performance and therefore use incentives, profit sharing or otherwise, in every possible situation. From employees we expect an honest day's work for an honest day's pay. We believe in the philosophy of continued employment for all Worthington people. In filling job openings, every effort is expended to find candidates within Worthington, its divisions or subsidiaries. When employees are requested to relocate from one operation to another, it is accomplished without financial loss to the individual.
Customers Without the customer and his need for our products and services we have nothing. We will exert every effort to see that the customer's quality and service requirements are met. Once a commitment is made to a customer, every effort is made to fulfill that obligation.
Suppliers We cannot operate profitably without those who supply the quality raw materials we need for our products. From a pricing standpoint we ask only that suppliers be competitive in the marketplace and treat us as they do their other customers. We are loyal to suppliers who meet our quality and service requirements through all market situations.
Organization We believe in a divisionalized organizational structure with responsibility for performance resting with the head of each operation. All managers are given the operating latitude and authority to accomplish their responsibilities within our corporate goals and objectives. In keeping with this philosophy, we do not create corporate procedures. If procedures are necessary within a particular company operation, that manager creates them. We believe in a small corporate staff and support group to service the needs of our shareholders and operating units as requested.
Communication We communicate through every possible channel with our customers, employees, shareholders and the financial community.
Citizenship Worthington Industries practices good citizenship at all levels. We conduct our business in a professional and ethical manner when dealing with customers, neighbors and the general public worldwide. We encourage all our people to actively participate in community affairs. We support worthwhile community causes.
We call this our code of operation. When we send a new plant manager in to manage a multi-million dollar facility, all this person receives is a review of this card, a handshake and the company says: Congratulations and good luck. We don't send this person out with reams and reams of operations manuals. Instead we say that if you can live by this philosophy, you can manage just about anything. Our philosophy talks about everything of vital importance-earnings of course, and this is brought about by people and customers. We talk a lot about the golden rule-treating other people they way you would like to be treated. Some of our people have taken it a step further and call it the platinum rule-treating others the way they want to be treated.
The chairman of our company continually talks about the value of respecting others. This leads into diversity of people issues. An example of this occurred when one of our young plant managers in one of the southern states called me late on a Friday evening. He said he had a difficult situation in the plant. This involved a maintenance man who hung a rebel flag from his tool chest. That display is often done in the south as a part of history or tradition. However, this person had a supervisor who found it very offensive. This situation resulted in a conflict and the two men brought the matter to him to resolve. I asked the plant manager what he was going to do about this situation. He responded that he did not know but would think about it over the weekend.
On Monday morning he called back. He said that over the weekend he was riding his lawn mower and decided he would go back to the company philosophy. He said we are going to sit down and talk about the golden rule. We are going to say to the fellow who has the rebel flag: What does this mean to you? Then we are going to give the other gentleman an opportunity to say what it means to him-how does it make him feel? The supervisor called back later in the morning and said the meeting was fantastic. He said the two persons came to their own agreement using the philosophy of the golden rule. This is a simplified answer to how this philosophy works.
We also talk about citizenship in our philosophy. We go out and ask communities for the opportunity to locate plants and facilities in their community. We also ask them to let us use their water supply, the air around them, their people. We have an obligation to those communities to use their resources wisely. If we pollute, put filth into the air, bring their sons and daughters into our plants and allow them to get injured, we are not being very good citizens. If we go into these communities and don't donate to important activities, we are not being a very good citizen in that area. We are visitors in these locations. We are there because they allow us to come in. We have to treat their people and resources with a great deal of respect. Respect and dignity start at the top of our organization and go all the way through Worthington Industries. It has been there for forty-three years.
One example of this was a memo that was sent out in 1970 to all of our plant employees from John H. McConnell, the founder of our company. It was dealing with safety and he said that if he knew that there were going to be injuries in any of our facilities the next day, he would rather shut the facility down and lose the production time as opposed to somebody getting hurt and injured. Now that is a very clear statement that says people are important.
We also talk about personal accountability because it is a two-way street. The company has a part that we are responsible for and the employees have a personal responsibility-particularly for worker safety. It is one thing to have a philosophy card hanging on the wall but the proof is action: How do your people treat each other? How do your people treat the customer, the suppliers? How do they treat the company?
At Worthington Industries it is a belief in people-they are the most important part. Anybody can go out and buy machines. It is easy to get money but it is difficult to get the right people. If we don't have the right people, we can't do anything. If people don't treat each other the right way, we don't have anything. All this adds up to happy customers, and good quality products. When all this comes together, we make money. It is the result of a synergy wheel focus. Whether you call this ethics, a belief system or a value system, I'm not sure. In our company we talk very strongly all the time about values.
THE DISCUSSION
A participant asked: How does a company "teach" its values to employees? to which Campbell responded that Worthington probes an individual's values at the time of hiring. Another question concerned the relation of core values to general business practices, e.g. gathering intelligence about competitors.
Response by Campbell: Worthington Industries has a history of business practice that includes considering: 1) Is this deal right for the other person? 2) Is it right for you? 3) If it were plastered over the front page of a newspaper, would you be happy that you were involved in it? 4) If you did something like this, would your parents be happy to hear about it?
ABOUT THE PANELISTS
Dominic P. Garda began his career with AT&T in the Operations Systems Business Unit. He was promoted to management in 1986 and to Department Head in 1994. He has had experience working on and managing a variety of products for AT&T and Lucent Technologies. Since April of 1995, he has been responsible for the NetMinder (See Note) Traffic Management product line. He holds a BS in Electrical Engineering from the University of Notre Dame, and an MS in Computer Engineering from Carnegie Mellon University.
Roger N. Campbell has been associated with Worthington Industries for a number of years. He started in regional sales; became Vice President, Sales Manufacturing, ACT (a business division); and is now Director of CorporateTraining. He has a BS from Muskingum College and a Master of Education from Bowling Green State University.
NOTE
NetMinder is a registered trademark of LucentTechnologies in various countries outside the United States.
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