In Key #2, the importance of having a business vision was emphasised. A clear vision of the kind of business you want in the future can only flow out of your values. Your values are your fundamental beliefs and principles – your internalised standards. They guide your behaviour – and form your conscience. They determine what you stand for, what you believe in and hence the quality of what you do.
The values of the owner-manager(s) of a business usually become the culture of the business, and every business is known by what it stands for and does – either good or bad. It is often said that a private sector enterprise has a personality. In the face of massive and continuous change, every business must make appropriate changes to its products, services, methods and the ways it operates. Change avoids becoming irrelevant to buyers, and is the only way to survive in a highly competitive, uncertain and turbulent business world, even though there will be growing pains.
However, when facing the need for change, it is sometimes very tempting and seems very appropriate to shift away from core values – to water down or compromise on such values as integrity, commitment, loyalty, reliability, social awareness and professionalism.
Compromising core values can create serious harm for a business by undermining its image or reputation among buyers. Change, but hold fast to core values!
What was said about the need for change above in Key 8a does not need repeating. However, when facing rapid and major changes, one of the guiding rules is that, as far as possible, you should hold on to your existing expertise, knowledge, experience, skill base and customers – what has been labelled ‘stick with the knitting’. This is not intended to mean that no changes should ever be made to products, services and operating methods – quite the contrary. But, the further you move away from what you do best, the greater the risk involved.
Radical changes such as diversifying into unknown products, markets or industries can be very dangerous, as some of the high-flying entrepreneurs of the 1980s learned to their regret. It follows that
You must be careful about getting into a business you don’t know how to run.
Diversifying can drastically dilute your QRS capabilities (see Key #4).
Rather than diversify, you should first consider moving into related or similar products, services, technologies and markets – to gain synergy [2 + 2 = 5]. This means keeping your core skill base intact while being ever alert for opportunities for improvement and innovation.