the importance of value management
Introduction
With the development of science, technology, and economy, global competition is increasing. Facing the challenge of the knowledge economy and global market competition, as well as how to enhance the core competitiveness and cultural management level of enterprises, has become a hot topic of research and discussion. In the previous studies, value management comes into being and has been paid more attention by practice and scholarship. Regarding the importance of value management, this paper chose Wedgwood as an example to discuss how Wedgwood does use different practical activities to explain the companies’ discovery, establishment, and value management.
The concept of values dated back to 1951 and was proposed by the anthropologist Kluekhohn, which was an idea of what is worth and what should do. Kluckhohn (1951) stated that the values were influenced by the implicit or explicit conception of an individual or group when faced with the choice of way and purpose of action. Moreover, Rokeach (1973) pointed out that values were individual or social preferences, pursuits, and persistent beliefs about a particular behavior. A value system was a combination of beliefs and preferences for different behaviors. Since then, values have ceased to be an idea, but rather an individual or group’s behavioral preferences, standards, guiding the lives or social activities of an individual or group (Madrigal and Lynn, 1994).
For corporate values, the Japan-US International Competition in the 1980s attracted scholars from all over the world to explore corporate culture management. Values, as the heart and center of organizational culture management, were continued to study (O’Reilly et al., 1991). In detail, for the terms of corporate values, Andrew Campbell and Sally Yueng (1991) argued that corporate values are philosophical thinking of business, expressing the principles of faith and value between corporate and social normative structures. At the same time, Duo and Li (2009) believed that the implementation of value management is a cultural change that has driven changes at the strategic, operational, and individual levels. The contributions of the corporate values are permeating all aspects of corporate management and gradually form a value management system. Furthermore, the implementation of values includes the dissemination of values through the construction of corporate culture, the establishment of values-based codes of conduct, and the re-engineering of institutional processes, selection and recruitment, training, and monitoring based on values (Rosenblatt, 2011). To this end, the general beliefs of the transformation of values into employees can be through the conversion of values into goals through the performance evaluation method to evaluate the effectiveness of value management, and integrate value management into daily work (Rosenblatt, 2011).
According to the existing research on corporate values, this paper will choose the Wedgwood as an example to analyses how corporate values practiced and how do the corporate values influenced the company. Wedgwood is a company that was founded by Josiah Wedgwood on 1 May 1759, and it manufactures luxury accessories and porcelain. It was rapidly successful and became the biggest company in the manufacturing of Staffordshire pottery, and this product was exported all over Europe, Russia, and America. It mainly became successful in the production of stoneware and earthenware that were accepted as equivalent in quality to porcelain but were much cheaper. “dry-bodies” stoneware jasperware in contrasting colors is Wedgwood most associate, and “Wedgwood blue” and white being primary, always much the most known colors, more so, there are other colors. Since 1775, the company has been making Jasperware continuously; in the 18th century, it became much limited. Nevertheless, it was table China in earthenware creamware that is refined that made a lot of profit and sales (Holt and Andrew, 2013).
The analysis Wedgwood Company helps to have a deep understanding of the human resources management curriculum, learning the definition of corporate values and their importance to the business development of the enterprise. At the same time, how the values of the enterprise are generated and how to match the values of employees in both directions are also worth discussing. Therefore, this paper was divided into three parts: the explanations of the two-way matching of employee and organizational values and the discussions of the roles that the human resources department plays in the enterprise value management process. In the end, this paper will summarize the evaluation and reflection on the learning experiences of value management.
Theories and Practices of Value Managements
Terms of Value Managements
In the enterprise to build the core competitiveness, value management has become more and more enterprises, which is the main driving force behind the rapid change in building sustainable competitiveness and more humanization (Chang et al., 2013). Values management injects people-oriented management concepts into enterprise development goals and fundamental principles, improves the effectiveness of management, and complements the directive management mode and the target management model (Xiao, 2010). Besides, it also introduces social ethics into enterprise management, emphasizing corporate social responsibility, and civic awareness (Xiao, 2010). Values management’s critical function is to maintain the organization’s ability to align core values with organizational strategies (Paarlberg and James, 2010).
With the expansion of the application of value management, more and more scholars have studied the types of value management and the implications of it. According to the collected and collated literature, the management process, core theory, strategic tool are the three main categories of value management (Sroufe, 2013). The Management Process School advocates value management as a way for managers to establish and promote shared values (Robbins & Coulter, 1996). Shan (2002) pointed out that value management is the glue of enterprise cohesion and the spiritual pillar of enterprise development, and he plays a central role in modern enterprise management. Furthermore, Strategic Tools advocates value management as a new strategic leadership tool whose core is to enable employees to share and communicate their values in their day-to-day work (Dolan S L, Garcia S, 2002). Thus, value management can be regarded as the core of enterprise culture construction and target orientation.
Corporate values are the result of the historical precipitation of the company in the development process. It is an essential content of corporate culture. Corporate values represent the standard value orientation of all members of the company and guides the behavior of the company and employees (Dowling, 2006). In the process of enterprise value management, not only the organization unilaterally decides the enterprise’s values be adapted by employees, but also a two-way matching process between individuals and corporate values (Chatman, 1989). Chatman (1989) was the first to propose that value matching refers to the degree of similarity between individual values and the organization’s value as a whole and at all levels. It belonged to similarity matching between individuals and organizations rather than compatibility matching. This view is similar to the Similarity-Attraction theory, which points out that the more similar an individual is to an organization or its members in terms of attitudes, beliefs, cognitive characteristics, and values, the easier it will be attracted by the organization or leadership. Employees are more inclined to maintain connections with individuals and organizations with similar values (O’Reilly et al., 1991).
In practice, two-way matching of employee and organizational values can be reflected in many aspects, such as increased employee work attitude, increased engagement, innovative behavior, positive promotion of advocacy behavior (Zhang et al., .2009). At the organizational performance level, Hoffman et al. (2011) found that employee and corporate value matching had a direct positive effect on the effectiveness of the team. As the source of value creation, employees gradually awakened their sense of self-management and paid more attention to the experience of work and the degree to which personal values and organizational values fit in the workplace. Meanwhile, Park and Yeo (2011) used a different approach from traditional measures of employee-organizational value matching, using alternative methods, multi-polynomial regression, and multi-response personal analysis to arrive at a positive relationship between value matching and organizational performance. Besides, the entrepreneur’s values are essential factors that affect the management of corporate values. Schein (1992) clarified the connection between leadership and corporate culture, stating that entrepreneurs, as corporate leaders, are the shapes of corporate culture, and leadership styles are influenced by solidified corporate culture. At this point, corporate leaders must change by promoting corporate culture. Therefore, employee performance can be improved as a measure of the two-way match between employee and organizational values.
Besides, a corporate core value will clearly explain how people interact with each other and customers. When there is success in values, the people’s daily characters will incorporate the set core values. According to Patrick (2002), when the values don’t succeed, both your employees, customers, and business will suffer. Therefore there’s a need for creating a value statement that will help in the alignment of the organization culture and the employees. Firstly, avoid the “feel goods” this is where the values can be battles-tested by success. Instead, companies should think their importance concerning tough times they have undergone in the organization, this is where the organization recalls the situation that was so challenging and how the company responded about it. If the organization did not come out with the decision then the organization has to reexamine the value of the company. They will have to come up with benefits that will help in coming up with the guide of decision making, and leaders of the organization should involve their employees to know the reason for decision making. Secondly, to create value that will help improve the behavior in the corporate, the organization must critically think how the culture will be informed, daily made decisions and the actions that will drive in the field, where the placed policies will help support them and make sure that leadership team is both communicating. Values are exemplified to the group (Patrick 2002).
Practical Observation of Value Managements in Wedgwood
As for the application of value management, Wedgwood is a good example. After visiting Wedgwood, we found that the company’s values management applied the theory of the management process school, and it is a professional experience to solve the management activities of enterprises in the process of exploring values and summarizing values in-depth management, as well as makes value management more scientific and feasible.
In the process of Wedgwood value management, Paul Grisleys (2002) three-step process theory is adopted: understanding the value of the enterprise, value recognition, and change, maintain ingesting the values of the enterprise. In detail, making the everyday extraordinary is one of the central Wedgwood’s values. To realize it deeply, Wedgwood, the company has set three sub-values, including creating change, celebrating every day, and grow with compassion, which applies the concept of two-way matching of employees and organizational values.
For exploring the values, Wedgwood listened to employees’ voices through two large-scale projects: employee survey and values project. This helps to hear the employees’ proposals, as well as finds out that the values already existed among employees and within the company widely. As stated in the previous studies, value matching has positive effects on employee advocacy behavior through intermediary variables such as emotional commitment and organizational support (Afsar and Badir, 2017). Wedgwood’s value exploration encourages employees to make positive suggestions through two large-scale and then discovers the company’s significant values. This is a powerful example of the two-way matching of values from employees and the organization.
For identifying the values, employees are often attracted to organizations with similar goals or values to show the importance of matching in recruitment (Schneider, 2010). Wedgwood’s human resources management in terms of value identification is mainly about recruitment and selection. In the career selection process, recruitment and selection are Wedgwood’s unilateral selection of values for candidates. The recruitment principle of Wedgwood is to hire the right person to hold the right position. However, the ‘correct’ person not only means that the candidate needs to meet Wedgwood’s requirements in terms of knowledge and skills but also refers to the values of the recruitment target must meet Wedgwood’s values. Thus, in the process of recruitment screening, organizations often choose employees with similar values and concepts. In practice, to match the two-way candidate with the organization’s values, Wedgwood Human Resources Department adheres to the following four principles in the recruitment and selection process:
Shaping a positive candidate experience in all regions
Developing a consistent hiring manager process and experience
Strengthen the role of human resources as a partner in this process
A global tool for cooperation, efficiency, and transparency
By maximizing these four aspects, Wedgwood makes the everyday extraordinary values are conveyed to the candidates. This has helped in promoting transparency and ensuring that all members involved are following the recruitment process, which has confidence that results will be right. Besides, these principles ensure candidates get informed about their application status if they get a job.
For maintaining the values and its importance, Wedgwood has discovered and established values to change corporate values in the short term. Wedgwood continues its values through its annual employee engagement survey. According to the direct functions and benefits of the two-way matching of values (Ünal et al., 2015), this study found that the matching of employee and organizational values can also have an indirect effect on employee engagement through a sense of performance fairness. At this point, the pursuit of excellence and innovation in knowledge-based employees are the characteristics of matching values related to work and the environment. The intermediary role plays a significant role in the team atmosphere (Wu, 2012). Thus, Wedgwood’s Employee Engagement Survey is an indicator of the current status and does not produce any automatic improvements. The action the team takes in response to the results is the critical matter because the survey is full participation and actual feedback. To this end, Wedgwood can understand the current status of employee engagement through the study and follow the current situation of employees’ values. Based on these views, Wedgwood can make relevant adjustments to the matching of employees and organizational values.
Evaluation of the Value Managements in Wedgwood
The discovery and formation of corporate values is the primary task of corporate values management (Sirmon et al., 2007). Ken Blanchard (1997) proposed that value management should establish core values, communicate values, and practice based on values. Then the establishment of clear corporate values can enhance the efficiency of corporate value management and honestly play its role. Wedgwood reasonably uses the theory of value management process to solve the management activities of enterprises in the process of exploring values. At the same time, it also summarizes the values in the management process and makes the value management more scientific and feasible. The first approach of the Wedgwood value management is the two-way of matching values between individuals and organizations, which based on Grisley’s (2002) three-step process theory. However, Wedgwood updated the details in the last step with its situation. Wedgwood has focused more on maintaining employees’ recognition of corporate values, rather than maintaining the development of corporate values. Through Wedgwood’s value management, employee performance has increased by 40%, customer satisfaction has increased by 18%, and corporate finance has grown by a factor of 4.5.
However, the influence and role of leaders in Wedgwood’s value management process have not been reflected. This aspect needs to be improved if Wedgwood wants more efficient value management. The leadership role of enterprise managers is crucial in the process of enterprise development, and it also plays a decisive role in the management of enterprise values. In Wedgwood, the founder’s spirit is the source of corporate values. Besides, managers’ management level and leadership ability are an essential guarantee for the company to always implement the core company values. In this way, the manager regards corporate values’ management as a necessary task for the development of the company, which helps to run the value management effectively.
Conclusion
This paper reviewed the terms of value management and corporate values. Based on this knowledge, the author used Wedgwood as an example to analyses how value management practices.
Through the visit in Wedgwood and the explanation of its human resources team, the author had a deep understanding of the theoretical knowledge of the value management, and at the same time, had a comprehensive view about how the corporate values were discovered and generated. For the first point, the two-way value matching between employees and the company is carried out by introducing Wedgwood’s human resources practice activities. Wedgwood’s human resources team is not limited to the content of value management but also focused more on maintaining employees’ recognition of corporate values, rather than maintaining the development of corporate values. According to these, the concepts and activities of all aspects of human resource management are introduced and explained very clearly, which is of considerable significance to our theoretical and practical learning.
For the second point, the author found that the practice of value management can guide stakeholders to have a more positive belief in the development of the enterprise, which is the driving force for driving employees to unite, achieve strategic goals, and promote the company to develop in a better direction. With the company’s development and changes in the external environment, the company’s values continue to build in management practices. In this way, the role and role of the human resources department in the management of corporate values were in essential stages. This requires the human resources practitioners to help the continuous expansion and innovation of the organization’s values and the constant optimization and improvement of value management while keeping the core values unchanged. Regarding the practice observation of Wedgwood, it can be found that values are gradually implemented from a concept in all aspects of enterprise management, and have become the conventional behavior norms and beliefs of enterprises. Thus, human resource practitioners need to guide all aspects, from strategy to daily work, to refine the value system.
Reference
Campbell, A. and Yeung, S. (1991). Brief case: Mission, vision and strategic intent. Long Range Planning, 24(4), pp.145–147.
Xiao-bo, S.Q.X., 2010. People-oriented Management of Higher Vocational College Students [J]. Journal of Changzhou Vocational College of Information Technology, 3.
Chatman, J. A. (1989). Improving interactional organizational research: A model of person-organization fit. Academy of management Review, 14(3),pp. 333-349.
Collins, J.C. (James C. and Porras, J.I. (1994). Built to last : successful habits of visionary companies. Century.
Holt, R. and Popp, A., 2013. Emotion, succession, and the family firm: Josiah Wedgwood & Sons. Business History, 55(6), pp.892-909.
Dolan, S., Garcia, S. and Dolan, S. (2002). Managing by values: Cultural redesign for strategic organizational change at the dawn of the twenty-first century. Journal of Management Development, 21(2), pp.101–117. [online]. Available from: http://search.proquest.com/docview/36025166/.
Duo Lun, and Li Chaoping. (2009), Value management: the way of business survival in the 21st century , Beijing: Renmin University of China Press,.
Grisley. (2002). Management Values [M]. Economic Management Press.
Hoffman, B.J. et al. (2011). PERSON-ORGANIZATION VALUE CONGRUENCE: HOW TRANSFORMATIONAL LEADERS INFLUENCE WORK GROUP EFFECTIVENESS. The Academy of Management Journal, 54(4), pp.779–796.
Kluckhohn, Clyde. (1951). Values and Value Orientations in the Theory of Action, Parsons, T. and Shils, EA.Toward a general theory of action.18(4),pp.36-61
Liu Yang. and Zhao Shuming. (2015). Values, cultural management and corporate leadership behavior. Journal of Reform. (8), 96-102.
McLean, B. and Elkind, P. (2004). The smartest guys in the room : the amazing rise and scandalous fall of Enron . Updated ed. London: Penguin.127-128.
O’Reilly, C.A., Chatman, J. and Caldwell, D.F. (1991). People and Organizational Culture: A Profile Comparison Approach to Assessing Person-Organization Fit. The Academy of Management Journal, 34(3), pp.487–516.
Rosenblatt, V., 2011. The impact of institutional processes, social networks, and culture on diffusion of global work values in multinational organizations. Cross Cultural Management, 18(1), p.105.
Park, Y. K., and Yeo, S. C. (2011). Testing the relationship between person-organizational value fit and performance. Korean Journal of Applied Statistics, 24(2), pp.411-424.
Robbins, S.P. and Coulter, M.K. (1996). Management . 5th ed. / Stephen P. Robbins, Mary Coulter. London: Prentice-Hall International.
Rokeach, M. (1973). The nature of human values. New York: Free Press.
Schein, E.H. (1992). Organizational culture and leadership . 2nd ed. San Francisco, Calif: Jossey-Bass.
Schneider B．(1987). THE PEOPLE MAKE THE PLACE. Personnel Psychology, 40(3), pp.437–453.
Shan Xiaohong. (2002). Values: the soul of modern enterprise management [J]. Theory and Reform, (2), pp. 91-92. \
Ünal, Z. and Turgut, T. (2015). The Buzzword: Employee Engagement. Does Person-Organization Fit Contribute to Employee Engagement? Iranian Journal of Management Studies, 8(2), pp.157–179. [online]. Available from: http://search.proquest.com/docview/1682163280/.
Wu Zhe. (2012). Knowledge staff engagement: a systematic study of a three-dimensional model. Journal of Systems Science. (4), pp. 84-87.
Zhu Qingsong, Chen Weizheng. (2005). Employee values and organizational values: fit measurement indicators and fit models. Chinese Industrial Economy. (5), pp.88-95.
Madrigal, R. and Kahle, L.R., 1994. Predicting vacation activity preferences on the basis of value-system segmentation. Journal of Travel research, 32(3), pp.22-28.
Paarlberg, L.E. and Perry, J.L., 2007. Values management: Aligning employee values and organization goals. The American review of public administration, 37(4), pp.387-408.
Sroufe, R., 2013. Developing sustainable supply chains to drive value: Management issues, insights, concepts, and tools. Business Expert Press.
Dowling, G., 2006. How good corporate reputations create corporate value. Corporate Reputation Review, 9(2), pp.134-143.
Afsar, B. and Badir, Y., 2017. Workplace spirituality, perceived organizational support and innovative work behavior. Journal of workplace Learning.
Sirmon, D.G., Hitt, M.A. and Ireland, R.D., 2007. Managing firm resources in dynamic environments to create value: Looking inside the black box. Academy of management review, 32(1), pp.273-292.