What your team thinks you value matters more than you realise

Research shows that when employee and leader values are aligned, it results in increased sales, staff retention, and work attitudes. But in an era of impression management, how your values are perceived matters most.

When you hear organisations talk about values, it can feel like a box-ticking exercise.

However, new research has found employees’ perceptions of leaders’ values matters.

Perceptions of shared values have been linked to increased sales, staff retention, quality of relationships, team effectiveness, and performance.

On the flipside, when employees perceive that their values aren’t aligned with their boss, it’s associated with high staff turnover, tension, burnout, and even unethical or deviant behaviour.

The key word is perceived.

What matters most, according to the research, is how employees perceive the values and actions of their leaders, rather than whether their actual values align.Sharing the same actual values with your employees is somewhat less important for leaders, especially to performance outcomes.

For leaders, this has important implications for how you behave at work.

The research was led by University of Exeter’s Associate Professor Allan Lee in collaboration with Melbourne Business School’s Professor Alex Newman, Assistant Professor Rohit Piplani and Professor Will Harvey and Professor Gregory Maio from the University of Bath.

Here are the key takeaways for managers.

Why values matter at work

Values form a core part of our identity.

They’re rooted in deep seated beliefs that are often shaped during our childhood and adolescence through socialisation, family influence, and cultural context.

According to the Schwartz Theory of Basic Values, values are the guiding principles that influence our actions, perceptions, and decision making.

And they remain relatively consistent over time.

At work, Professor Alex Newman says values shape the way leaders think, behave, and make decisions.

And they influence the kinds of goals leaders set for their teams which have direct implications for employee experience at work.

“I’m an achievement-oriented person so I like to focus on those end goals but that doesn’t necessarily work well for everybody,” he says.

Leaders who value benevolence are likely to behave in a way that places higher rewards on wellbeing and inclusivity in their teams.

If you share the same values in the workplace, you’ll share the same approach and see things in a similar way.

“If you don’t have people who share the same values as their leaders, you’re going to have quite high turnover in your team,” said Professor Newman.

Perception can matter more than reality

One of the interesting findings of the research was that perception matters more than reality, which has resonance to why people choose to share fake news.

The research distinguishes between Perceived Value Congruence: how much people feel their values match and Actual Value Congruence: how closely leaders' and followers’ values really match when compared directly and using specific values.

While Actual Value Congruence was also associated with greater job satisfaction, commitment, reduced stress, greater trust, employee engagement, and higher quality relationships, there was no consistent link when it came to job performance.

However, greater job performance was consistently linked with Perceived Value Congruence.

Professor Harvey said this highlighted the importance of values fit when hiring both the leaders of your organisation and the employees who report to them.

“It’s important for organisations to have a process where they think about their organisational values, leader values and employees' values” Professor Harvey said.

Many organisations already include values-based interview questions in hiring processes and incorporate values into their performance evaluations.

“For example, if it’s inclusiveness you value you might ask your employees in performance evaluations to talk about what they’ve done at work to be inclusive.”

Professor Newman said the Schwartz values survey was a useful and comprehensive tool for uncovering values.

Diversity still matters

We know it’s human nature to like people who are like us, but only hiring people who are similar to us is not a recipe for business success.

Research has proven diverse teams are more innovative, profitable and importantly have a greater understanding of the diverse needs of your customers.

This is why Assistant Professor Piplani says when we think about values, particularly when it comes to hiring, you don’t want to overdo it.

“It’s if they are completely misaligned that it becomes more problematic,” he said.

And Assistant Professor Piplani says you can still share values while at the same time hiring for diversity of thought and experience.

Values don’t exist in a vacuum

Context also matters when it comes to values.

“A lot of your values are influenced by your upbringing, your religion, education and your cultural background,” Professor Newman said.

This has important implications for leaders working in cross-cultural settings.

“If you’ve got managers going into a new cultural context, they need to be aware of the value systems and how they might differ because of that cultural context, for example in more hierarchical cultures,” he said.

“In these cultures, lines of authority play an important role in decision making across an organisation.”

Key takeaways for managers

While there has been plenty of research on the value of values, this research highlights that how you communicate your values as a leader matters more than you think.

Sharing the same actual values with your employees is not what is most important.

What matters most, is how your employees think they align with you as a leader, and this has important implications for how you behave at work.

Here are five key takeaways:

• Reflect on your own values as a leader and how you communicate these in your everyday interactions, not only in formal settings.
• Perception matters: Think about how your words and actions may be perceived, seek feedback on how your values are seen by others, and adjust your communication accordingly.
• Values fit matters for organisational success. Hire leaders who fit organisational values and align employees with leaders in teams where there is broad values alignment.
• Use values-based hiring strategically to ensure diversity of thought and experience is protected.
• Clearly articulate your values especially during times of organisational change to build greater trust and readiness for change in your organisation.