How a Shadow Values Review can improve your organisation

Michelle Bloom, Director of Consulting and Leadership at The Ethics Centre, discusses the results of Shadow Values Reviews she has conducted for Australian organisations, which reveal and unlock the hidden values that really guide an organisation’s culture.

Shadow Values and principles are an expression of the unstated operating culture of an organisation. Operating beneath the surface, they lie beneath the expressed values and associated behaviours of an organisation. Many organisations, for example state “collaboration” as one of their values which is an effective and positive way to ensure you get the best thinking and diverse perspectives. However, what The Ethics Centre’s Consulting and Leadership team have found is, the value of collaboration is operationalised as “co-operation”, leading to less diversity of thinking and curiosity to explore perspectives. Shadow Values can be even an organisation’s culture as they remain unspoken and out of awareness.

We spoke with Michelle Bloom of the Ethics Centre’s Consulting and Leadership team about the results of Shadow Values Assessments she has done for Australian organisations.

How does a Shadow Values Assessment differ from a traditional staff engagement or culture review?

Most large and medium sized organisations do engagement and culture reviews. Having completed many, with different organisations, we’ve found they’re useful up to a point, usually determined by people’s feeling of psychological safety – the point to which they feel safe to express their actual experience.

We’ve all experienced going through the motions with surveys and being less than forthcoming with our opinions when being asked for feedback, whether that’s because of apathy, fear of reprisal or any number of reasons.

What we’ve done is developed a range of methodologies and approaches to get below the surface of how people feel when they talk about work and build a climate of safety for employees to express their opinions freely without fear of retribution.

This is important because once the skeletons are out of the cupboard, the Shadow Values are all known – they’re understood, people feel a sense of relief and optimism that things can change and change for the better. It’s a different paradigm – this approach is more social science and anthropological, more qualitative than other, more standard culture pulses and staff surveys. It’s more about listening to how people express their experiences, which means they’re inherently more comfortable in having a conversation that’s focused on what matters to them and about how the organisation lives their values and where they don’t.

The approach explores people’s lived experience of the values, and the language people use to describe their perceptions gives you a different depth that you don’t find in other culture reviews. Our culture review provides rich insights into the shadow aspects of the culture which is particularly important is times of rapid change and uncertainty. It is not using benchmarks, often validated in a BAU environment, which give a partial view and less relevant in a VUCA context.

What sort of Shadow Values are exposed by these assessments?

We often find similarities in the Shadow Values raised across different organisations, for instance employees recounting their ability to raise issues, manage up, or quoting expressions such as, “keep your head down” and “don’t rock the boat”. These are very common manifestations of maintaining harmony, avoiding conflict, and just getting your job done.

Our insights provide an understanding of how the different Shadow Values constellate to form patterns of behaviour that support the implementation of strategy (or not). This allows you to see a systemic view of the organisational culture: how to shift, amplify and or re-enforce behaviours in service of living your values, implementing your strategy, and achieving your purpose as an organisation.

People join, stay, perform, or leave organisations based on their experience of the culture and what the organisation says it stands for. If there is a disconnect between the espoused values and purpose and the employees experience of them, it can lead to disengagement, resentment, poor performance and a cynicism impacting both the employee and customer experience.

These systemic insights are a bespoke part of the assessment and what we recommend to one organisation wouldn’t necessarily be the same as what we’d recommend to another. It’s about understanding the social system within the organisation, and each organisation will be quite different based on their shadow values.

How have you seen Shadow Values Assessments make an impact upon clients’ organisations?

Our clients have told us that Shadow Values Reviews have helped them to understand the drivers of behaviour and performance and guided them to intervene at a systemic level to shift these patterns and ways of working. The reviews also help them to understand the shadow values that are not formally codified but are having a very positive impact such as “entrepreneurialism” in one organisation.

Engagement surveys, 360 reviews and culture pulses deliver a very different set of quantitative data to the qualitative information about culture that comes from a Shadow Values Review. A recent client undertook both a traditional staff engagement and a Shadow Values survey to get insight into how to deliver on their strategy.

Another recent client had issues of psychological safety and allegations of harassment despite having policies and procedures in place to protect employees. As we have seen, all too much recently, that what is in the policy may not reflect how people actually behave. When organisations fail to address these Shadow Values, it can be a slippery slope, leading to unthinking practice, ethical failure, and moral injury. When we ignore, and unintentionally collude through fear, by not calling out and reporting behaviour we know are unacceptable.

What we were able to do was create safety for people to be able to discuss these very sensitive issues and share their experiences confidentially, and report back on themes and patterns of behaviour. People put a lot of trust in us and we have the credibility as we are  independent and not for profit, which is a key differentiator of The Ethics Centre from other consulting firms.

We made a number of recommendations that the organisation implemented, and as a result the executive feels strongly that they’re able to deal with the issues sensitively and ethically, manage the systemic risk, implement structural changes and build capability to align their ways of working with their purpose, values and principles.

Have you uncovered and rectified any other examples of detrimental Shadow Values?

In another organisation, we identified significant Shadow Values that created internal systems of patronage, where positional power and influence led to unofficial relationships of quid pro quo. It incentivised fostering relationships with people who had positional power, leading to toxic politics and nepotism. It was inherently destabilising, undermining trust and ran contrary to the more formal systems of reward/recognition programs, performance management and remuneration.

As part of our Shadow Values culture review, we make a number of recommendations to support the organisation to transform their culture aligned to their values. Recently we did a follow-up review with an organisation who had implemented all of our recommendations and the feedback was that employees described it as a “new organisation” and a massive shift in their perceptions and experience of the culture. The performance of the organisation also reflects this shift having delivered on its strategy despite the challenging operating environment over the last 2 years and the quality of the relationships with its stakeholders has been key to delivering on this.

The quantitative measures had improved out of the park – some had improved by 300%. The reasons for that were multiple, but they included a focus on ethical leadership recognising and shifting the Shadow Values, and making formal changes to the organisation’s structure and reporting lines.”

What is the end purpose of a Shadow Values Review, as opposed to traditional engagement and culture surveys?

With a Shadow Values Assessment we’re really measuring an organisation against their espoused values – what they say they stand for and what they actually do. In the time of stress and greater complexity that we now find ourselves, recognising shadow values is becoming even more essential to managing, governing and leveraging culture, for greater employee wellbeing and performance.

If an organisation needs to become more agile or customer-centric, understanding its Shadow Values ensures that it really understands how it actually works and will be able to make informed, evidence-based decisions on what they want to do about their culture to change it. Just saying we value something is not enough. Understanding how to be more “agile or customer centric” is key. Simple, traditional approaches and solutions often fail to deliver as they don’t consider the complex social system of the organisation and the eco system in which it operates, that really determines what is valued and what is rewarded, despite what is espoused.

Some riskier elements of organisational culture have emerged recently, in the way values and behaviours are operationalised, often unintentionally but with disastrous impacts on customers, employees and organisational reputation – think Royal Commissions and recent corporate failures. What a Shadow Values Review delivers is a deep insight into your organisational culture, the values and behaviours that drive it, and a roadmap to help navigate in these complex and rapidly changing times.

The Ethics Centre is a thought leader in assessing organisational cultural health and building leadership capability to make good ethical decisions. To arrange a confidential conversation contact the team at consulting@ethics.org.au. Or visit our consulting page to learn more.