A company philosophy can help both customers and employees understand what a business’s core values and strengths are, and in turn help a business close more sales and make more money. While company philosophies are generally informal and unwritten, taking some time to determine what your organization values and how it conducts business can go a long way toward more coherent decisions, better long-term planning, and more effective management.
What Is a Company Philosophy?
A company’s philosophy can be described as the reasons behind the goals that organization pursues, and the values that inform the pursuit of those goals. A simple company philosophy might be “we will do what is necessary to increase the value of investments in the company,” while a more robust one might indicate which segments of the population the company intends to serve, minimum standards for service, and areas in which the company refuses to cut corners.
Sometimes a company’s philosophy is codified and put down in an employee handbook, or made available online, but often what an organization values isn’t clear until boots are on the ground and sales are being made. In this case, a company’s philosophy might be described as the unwritten rules and standards of behavior and activity that govern its long-term approach to doing business.
Focus on the Customer
Intensely focusing on the customer can pay significant dividends. According to a RightNow Technologies report from 2011, more than five out of six customers would pay as much as 25% more for better service from a company. While doing right by the customer isn’t the only thing one can structure a philosophy around, it’s a good start for many businesses, especially those that are just starting out.
Approaching business with a customer-oriented philosophy won’t just give your company repeat business, either; it can also generate new business entirely. The same report indicated that more than 80% of customers switched brands over poor customer service. If you have a reputation for being guided by strong values regarding customer service, you can take advantage of crises faced by other organizations and start courting those customers.
Build Out From the Mission Statement, Code of Ethics, or Practices
Organizations that have both a mission statement and a stated company philosophy often use the company philosophy to articulate the more specific values that generated that mission statement. Both private companies and governmental groups put this strategy to work. If your mission statement includes an intent for your company to be environmentally sound, describe that in greater detail in your company philosophy. What components of your process can benefit from such an approach? How do you intend to deliver on that promise to your customers?
If you have a detailed code of ethics or set of practices you rely on, meanwhile, putting your company philosophy together might be even easier. Look for the common threads between the more detailed activities you expect members of your company to undertake, and the standards they are expected to apply in their work. For example, a company with a wide range of internal metrics for employee performance and detailed sales analytics likely considers informed, data-driven decision making a core component of its company philosophy.
Don’t Be Disingenuous
It can be tempting to throw as many nice-sounding words as possible into a public statement of a company’s philosophy, but avoid this at all costs. If your focus is on casting a wide net and selling to as many people as possible, don’t talk about the highly-customized, personal experience you intend to give each and every customer. Those who find that what they expected isn’t what they got from your organization are likely to run to a competitor, should they find one who actually delivers what your company merely promised.
By putting pen to paper and writing down your company’s philosophy, you can give employees and customers alike a better sense of what your business is about. What’s your company’s philosophy? Have you run into trouble when your practices and your philosophy didn’t line up? Tell us about it in the comments.