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Generally speaking, companies exists to create value, and the more value they create the more successful they will be. To maximize value, companies have pursued myriad initiatives, including investing in capabilities to improve the efficiency and effectiveness of their business processes such as business planning, resource allocation and management reporting.
Unfortunately, in many cases, these investments failed to generate the increase in value the companies expected—mainly because the companies overlooked the linkage between an organization’s culture and the value the company ultimately creates.
This paper outlines a new framework Accenture has provided that can help companies understand the critical elements of a value-centered culture and the steps they can take to get their people and culture more explicitly focused on creating value.
According to Accenture research, companies are lagging in creating a value-centered culture.
In the Accenture 2011 High Performance Finance Study, 26 percent of finance executives participating reported that the lack of a value-centered culture and finance acumen throughout the enterprise is one of their greatest challenges. And only 23 percent of those executives rated their finance organization’s value-centered culture capabilities as advanced.
Why are companies struggling to create a value-centered culture? One overriding reason is that many organizations find it difficult to articulate what “value” means because there’s no definition of value that’s shared consistently across the organization. In fact, the notion of value remains a bit complex, if not elusive. If the definition of value and how it is created are unclear or inconsistent, the mindsets of people in an organization may not be focused accordingly.
Value viewed from “the worker’s perspective” is anything that rewards the individual (both in terms of personal and professional fulfillment and in the monetary sense, value viewed from “the leader’s perspective,” is something that rewards the business and shareholders, while customers’ definition of value is a function of the company’s ability to influence and impact their lives.
Reconciling all these perspectives is often critical to the success of an organization but, based on Accenture’s client experience, it is hard to accomplish without a strong value-centered culture.
As companies seek growth in a global economy that has become more complex, more competitive and more uncertain, they face increasing pressure to create greater value than ever before. However, as Accenture’s research illustrates, many companies are missing one element—a value-centered culture—that is vital to value creation and, in many ways, is a leading factor in determining the ultimate success or failure of a business. Indeed, research has shown an organization’s culture can create sustained competitive advantage, and Accenture’s own client work has found that a company maximizes value when its employees’ mindsets, actions and behaviors are explicitly focused on and geared toward creating that value.
In short, for many companies pursuing growth and high performance, a value-centered culture is not optional. Their success depends on it.
When pursuing the implementation or enhancement of a value-centered culture, there are six key techniques a company can consider to get its people and culture more explicitly focused on creating value:
Getting the message through and backing it with incentives and rewards—one challenge that prevents many companies from creating a value-centered culture is the lack of a common understanding and definition of value. To enhance employee engagement with and support of the overall mission, a company can benefit from clearly tying rewards for how an employee acts and what they do at an individual and corporate level.
Translating and embedding a clear ethos—values, norms and policies can be embedded within employees’ daily work activities, but they can also bond with one’s personal lives—essentially becoming part of one’s way of life.
Clarifying why value is important and empowering managers to execute—communicating clearly the vision and strategic/ tactical plans for the organization and taking the necessary steps so everyone understands why they need to execute on those plans.
Striving for a high degree of “sensitivity” for all managers’ targets—to help employees understand how their actions contribute to the good of the enterprise, a company can draw a clear line between those actions and the ultimate value created.
Connecting investment business case development to group-level performance—helping a manager understand how a decision to invest in a particular project will impact the company’s overall financial performance can be beneficial.
Nurturing motivation with “gamification”—manifest the natural association between intrinsic motivations, like the desire for status and recognition, with behaviors associated with a value-centered culture.
R. Bergström—managing director and leads Accenture’s Finance and Enterprise Performance practice in ASEAN. Bergström is based in Singapore and is also the Asia Pacific lead for Accenture’s Enterprise Performance Management (EPM) capability group.
T. Brown DeVaughn—senior manager with Accenture’s Finance and Enterprise Performance practice. Based in Atlanta, Brown DeVaughn has more than 15 years of Enterprise Performance Management (EPM) experience working across industries.
E. Brook—senior manager with Accenture’s Finance and Enterprise Performance practice. Based in New York, Brook has more than 10 years of financial management experience working with corporate and government clients.
L. Tande—senior manager with Accenture’s Finance and Enterprise Performance practice. Based in Stockholm, Tande has more than 10 years of management consulting experience.
R. Smith—a retired Accenture global managing director of the Leadership Effectiveness practice. With 30 years of experience as a practitioner and researcher in the area of organizational behavior, Smith is focused on leadership and strategic human capital in organizations.
March 29, 2013
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