Good Entrepreneur Ethics Increase Business Value

Did you ever wonder how a new entrepreneur knows how to “do the right thing” for his business? Most experts believe that the essence of doing the right thing is ethics. Translating that into business value, a study by Wirthlin Worldwide concluded that 80% of customers still base a good portion of their buy decision on their perception of that firm’s ethics.

Ethics are generally defined as a set of societal standards that encompass the norms of the community. These norms are not genetic, and they have to be learned. At the base of these are moral values, but in my view most of the rest are gleaned from experience, parents, and formal education.

In the real world, the latest updates come from good business books, like the one by David M. Shedd, “Build a Better B2B Business.” This one focuses on the generic attributes, as well as specific processes, which add up to the ethically right thing for most businesses.

The generics include integrity and honesty, as well as the above mentioned moral values. The specifics for business include providing leadership in building the business, but also in contributing to the greater good:

1. Communicate your values and business goals. Do the right thing for the business starts with defining core values. Then create business goals to tackle the few critical issues and opportunities for the business. To be effective, communication has to be two-way and continuous, to keep the “right thing” as “top of mind” for all team members.

2. Align the organization to your values and goals. Ensure everyone is in alignment to live the values and focus on and execute the goals. Make the tough decisions to ensure the success and profitability of the business, and make the tough personnel decisions to put the right people in the right positions, giving them the training they need.

3. Manage priorities for the short-term as well as the long-term. Just as people must manage their personal and work responsibilities, so, too, must companies balance their priorities. Prioritize on the constraint in the business – that which is important, not on what is most urgent.

4. Endeavor to beat, not meet, industry standards. Doing the right thing is not just “getting by,” or squeezing within the letter of the law. It means knowing and living by the spirit of the law, as well as not waiting for new laws and regulations to fix problems. The same is true of employee standards, and social responsibilities.

5. Create winning teamwork. Leading people to do the right thing as a team is one of the most challenging things to teach and coach. Making a team work well requires constant communication, demonstrating accountability, ensuring motivation, recognition, and continual learning.

6. Look at yourself from your customer’s perspective. The right thing is for every business leader to value every customer and realize the importance of each in building the business. Your appreciation of your customers and focus on delivering value to them is a pre-requisite to customer satisfaction, growth, and success.

7. Balance work and life. We are all in business to be successful, but we are all people too. Another way to send a strong message about doing the right thing is to step up to the thorny “quality of life” issues, including balancing one’s work and personal life, work at home, and providing the right health, social, and spiritual needs.

Since ethical behavior is the base, the traits to foster this must always be sought out and nurtured. These traits include day-to-day work consciousness, enhanced discipline to foster a combined business and ethical acumen, and empathy for a high level of engagement. This insures that everyone is joined together, feeling a common imperative to do the right thing and make the right decisions.