Core values are the guiding principles that shape the identity and culture of an organization. They represent the beliefs, behaviors, and attitudes that define the organization and guide its decisions and actions. However, some people question whether core values are just fluff – superficial statements that have no real impact on the organization’s success or the people within it. In this article, we will explore the importance of core values and how they can shape an organization’s culture and impact its success.

Firstly, it is important to understand what core values are and what they represent. Core values are the fundamental beliefs and principles that guide an organization’s culture and behavior. They are the unwavering, unchanging principles that guide an organization’s decision-making process, regardless of the circumstances. Core values represent the organization’s identity and help to create a sense of purpose and direction.

Core values play a crucial role in shaping an organization’s culture. They provide a framework for decision-making, communication, and behavior, and help to establish a sense of shared purpose and direction. When core values are clearly defined and communicated, they can serve as a unifying force that brings people together and helps to create a sense of community and belonging.

Moreover, core values can also impact an organization’s success. When an organization’s core values are aligned with its mission and goals, they can serve as a powerful driver of success. For example, a company that values innovation and creativity is more likely to develop new and innovative products or services, which can lead to increased revenue and market share. Similarly, an organization that values collaboration and teamwork is more likely to create a positive and productive work environment, which can lead to increased employee engagement and retention.

However, it is important to note that core values are not just a set of words or slogans. They must be lived and demonstrated in every aspect of an organization’s behavior and culture. In other words, core values must be more than just fluff – they must be deeply ingrained in an organization’s identity and culture. This means that leaders must model and reinforce core values in their behavior and decisions, and employees must understand and embrace them as an integral part of the organization’s culture.

Core values are not just fluff – they are the foundation of an organization’s identity and culture. They provide a framework for decision-making, communication, and behavior, and can impact an organization’s success. However, to be effective, core values must be deeply ingrained in an organization’s culture and demonstrated in every aspect of its behavior. When this is the case, core values can serve as a powerful force that guides an organization towards its mission and goals.

Video Transcript

In this video, you’ll get answers to these questions:

  • Are core values just fluff?
  • What are core values?
  • Who comes up with the core values for your company?
  • How can you figure out your company’s core values?
  • When is it best to identify your core values?
  • What are common mistakes when coming up with core values?
  • What are common mistakes using core values?
  • What does it look like to implement core values on a day-to-day basis?

Are core values just fluff? I will never forget the day I asked a business owner that question and he slammed the table and explained to me why core values are essential for a company. In this video, I am going to answer the question, “Is it just fluff?” We will also talk about what are core values, what are common mistakes when coming up with core values, and how can you avoid common mistakes when applying core values.

I’m Aaron Hall, an attorney for business owners and entrepreneurial companies. If you haven’t yet downloaded it, I have a free guide, “Seven Common Mistakes Made by New Businesses.” You can get it at You just enter your email address and then I send it to you. And then I will send you some other free videos to help better understand some of these common legal mistakes and how to avoid them in your company.

So, here I was going to a round table discussion of business owners in Minnesota. It was a small group early at 6:00 AM one morning, and before we got started with the round table discussion, I would ask them a question based on something I had been reading about. I had heard about company values and core values, and when I worked for companies, I had seen those core values. They were listed on a website; they were listed in the employee handbook. But aside from that, I really didn’t see how is this relevant to what we were doing on a day-to-day basis. And so I wondered, are core values just fluff? Do they really have any meaning or relevance to an entrepreneurial company in today’s world? So I looked across the table and I said, “Hey before we get started, what do you guys think? Are core values legitimate or is it just some sort of touchy-feely concept that consultants try to sell to business owners?” It was at that moment, I will never forget, a business owner slams the table and says, “Core values are essential. They are the foundation of a great company. Everything you do is based on those core values, and if you don’t have them, you can’t run a successful company long-term.”

Around the table, other business owners chimed in agreeing with passion on the importance of core values. So at that moment, I realized from these successful business owners, core values are essential. They are important. They are vital. But I spent the next couple of years then reading about them and trying to better understand how core values look in a successful company versus just listed on a website somewhere.

What Are Core Values?

So, what are core values? Well, by core we mean they are core to who the company is. They are foundational, they are essential, they are vital. And by values, we are talking about what does the company value? What do they put importance on or weight on? And obviously, if you put importance on one thing, you are deemphasizing the relative importance of other things.

So, for example, if you say money is important and honesty is not a core value, then it is okay for you to get money and sacrifice being honest. But let’s flip that. If you say honesty is a core value, then you will be honest even if it costs you money. Often, you know if something is a core value based on whether you would rather close the company or lose money than to violate it.

So, what are core values? Well, you can go online and you can find out a whole list of optional core values. Many companies list them on the “About” page of their website. And there are terms like teamwork, integrity, honesty, entrepreneurism, flexibility, compassion, care, and the list goes on and on. What is not as important is the specific word that is used. The word obviously reflects a concept, and that concept then needs to be applied on a regular basis.

Who Comes Up With The Core Values For Your Company?

Who comes up with the core values of the company? In a small company, the entrepreneur or the founder. Or in a larger company, it is going to be the employees, management, and leaders who best reflect who the company is. So in an ongoing organization, if you are trying to figure out what are the core values, you might select the best employees, and the best managers, and that might be selected by the founder or CEO because those people best reflect who you want more of in the company.

For a small company with under 10 employees, the core values are identified by the business owner, the founder, and the person who created the company. And these core values often are tied into the why, the purpose, the mission, and the vision, but they are more about how you operate than why you operate.

How Can You Figure Out Your Company’s Core Values?

All right, so how can you figure out the core values of your company? There are a number of great books online. There are a number of websites, but ultimately, it comes down to intuition by the people who are coming up with those core values. So, in a small company, that is going to be the business owner. And you know, a value is core if you would rather shut down the company or you would rather lose money than to violate that core value. That is why it is a very personal thing. It is often related to the identity of the owner.

Why are core values so important? Core values are important. As the company grows, the number of people will be increased, and if those people don’t reflect the values of the founder or who you want the company to be, if it is a larger group, then you are going to have a conflict between those core values. The new people will have values that are in conflict with your company and how you want it to be run.

I founded a company in the past, and we focused very heavily on the core values in the hiring process and what we talked about. One mistake I made though, is that I allowed people to come into the company who said they believed in the core values, but six months later, we realized some of these employees did not. They were coming to the company and applying for jobs, saying what they thought they needed to say in order to get hired. And they might have even believed themselves that they shared the core values, but ultimately they were not willing to live out those core values to the detriment of their own financial impact.

So, if a person had to decide between integrity and losing their job, these people, like the ones who didn’t share my core values, would violate integrity to keep their job. We actually had that occur and it was devastating for the company. The takeaway here is you can work really hard in the hiring process to have core values emphasized. You can work to emphasize core values in the day-to-day operations of the company. But ultimately, sometimes you can be fooled as a business owner. It doesn’t mean you shouldn’t have core values. It just re-emphasizes the importance of core values. And if you have people who don’t share them, that can be devastating to the company.

When Is It Best to Identify Your Core Values?

When is it best to identify your core values? The sooner the better. By the way, I don’t believe core values change over time, but you may refine them and figure out exactly what they are. So you might better discover or identify them or learn better how to communicate them. But the sooner you figure that out, the better. And for a small business, your core values in the company are going to be common core values with who you are as a person and how you live your daily life.

What Are Common Mistakes Using Core Values?

What are common mistakes when coming up with core values? One common mistake is having too many. Generally, you should have four to six or so. But if you have 15 or 20 core values, those really are not core. You are lacking the ability to prioritize only that which is core. The essential ones should be identified because if you are trying to focus on 20 different values and 20 different things, that means you don’t have focus. Your focus is spread too wide, or your attention is too wide. Now, you can still look for other values in the hiring process. You can still look for other values when reviewing employees, but it is the core that you are talking about all the time, and it is identifying what is really the priority for us because frankly, you can only talk about so many things. If you have three core values, that is fine. But the problem that is often made by new business owners is that there are too many or they lack clarity. So time spent identifying those core values and talking about them regularly with the company and the employees, most CEOs will tell you that is time very well spent. This is because you are reinforcing the rules as far as how we interact and what behavior and mentalities trump other behaviors and mentalities, and that is vital, especially when profit is often driving a company. It is vital that core values are communicated regularly, so they are superior to the profit incentives of the company, and you keep everybody’s eyes on those core values.

What Are Common Mistakes When Coming Up With Core Values?

What are common mistakes when using core values? The biggest mistake is they get listed on a website, and they are not driving the day-to-day operations of the company.

What Does It Look Like to Implement Core Values on a Day-to-day Basis?

What does it look like to implement core values on a day-to-day basis? First, it is going to go into your founding documents, your website, and your “About” page. It is going to be broadcast if you will. Second, you are going to implement it in your processes of onboarding people and hiring people. You want to be testing for your core values through questions or perhaps some sort of assessment test for job candidates. Next, you want to make sure that your employees are rated based on core values. That they have regular feedback. So whether you have an annual employee review or a monthly review or even best is just an ongoing discussion of core values. And especially managers should be pointing out on a regular basis if an employee’s conduct or decision-making process conflicts with the core values. “Why,” you ask. “Why not just do it on an annual basis?” It is important that employees not be surprised when the annual review comes up. You don’t want to be bringing up topics for the very first time at an annual review. It is far better to bring it up incrementally as the issues arise. So an annual review might be a reflection on those conversations that have been had and how the employee is doing with core values. But my belief is that an annual review never should surprise employees with criticism for the first time. It should be a review of prior discussions that have occurred.

If you don’t already have the “Seven Common Mistakes Made by New Businesses,” it is a cheat sheet that I have. I invite you to get it. It is free. You can get it at And by signing up to get that, I will also send you periodic videos talking about other common legal mistakes. These are videos that are not publicly available online or on this YouTube channel. It allows us to have more of a conversation about how to grow your company. And again, there is no cost; there is no obligation. It is free, but it gives us a chance to have at least some sort of relationship as you are growing your company.