Company Philosophy (definition and how to create it)

While it is true that any company can sell a product or offer a service, what makes it different from the others in its segment are its company values ​​and philosophy. The Business philosophy it is basically a synthesis of your environment or culture in a group of fundamental values ​​that are intended to inform everyone about your business practices. Consequently, having a company philosophy is a great way to guide employees on the tough road of making decisions. decisions, while it can also be a powerful branding tool, making the workplace much more pleasant.

How to create a company philosophy?

It is important to mention that not all companies need to have a declaration of values, ethics and philosophy, however a well-known example of a company that has these three aspects is Google.

• Mission. When talking about a Mission statement, it is understood that it must summarize everything that the company does or outline its objectives. In the case of Google, its mission is to "organize information from around the world and make it universally accessible and useful."
• Philosophy. A company philosophy must delve a little deeper into the mission of the company, which is why it must be concise in ideas or values. In the case of Google, its philosophy includes principles such as "fast is better than slow" or "democracy on the web works" and "you can be serious without wearing a suit."
• Ethics. The code of ethics or code of conduct goes further into the philosophy of the company and its mission with the aim of dealing with certain types of behaviors and situations. Returning to the example of Google, this company includes in its policies conflicts of interest, confidentiality, as well as customer service, among other things.

The principles of the company philosophy have to come from being faithful to the company or to the founder or director as a person. As a founder or owner of a company you have to extrapolate the values ​​through execution using a number of hypothetical situations. You need to create dilemmas for yourself, in which there are trade-offs between benefits, ethically questionable practices, and customer experience. Next, it is necessary to analyze how the company should behave in each of these situations, thereby achieving a clearer idea of ​​the values.

Another convenient way to create a business philosophy can be through a brainstorming, words or concepts that you want consumers to associate with the company.

Characteristics of the business philosophy

One of the most important elements in a successful company philosophy has to do with a sensitivity to external forces or factors affecting the business, as well as the need to adapt to the environment in which the company operates. This is truly a fundamental approach in the company as the forces that affect it are unique facts and opportunities. It is well known that the most successful companies make constant efforts to keep the operations of their companies in line with the external forces that affect not only the objectives, but also the products, the strategy, the production process and the people.

We can identify five aspects or characteristics of business philosophy that are frequently applied in the most successful companies:

1. Maintaining high ethical standards in both internal and external relationships is essential to the success of the company.
2. Decisions must be based on facts, which must be viewed objectively, somewhat like a fact-based thinking approach to taking action.
3. The business must keep in constant evolution and adjust to the forces that act in its environment.
4. People should be judged on their performance, but not on their personality, education, or personal skills and traits.
5. The business has to be managed with a sense of competitive urgency.

Development of a company philosophy

When talking about the need to develop a company philosophy rather than just having it happen, the experience of others can be taken as an example. Successful companies, which, as we already mentioned, include these five common elements that can be considered as the basis for a good philosophy in any deal. In addition to these elements, the management of any company may consider adding other beliefs that serve to guide the organization. However, if these other elements are really going to be part of the company's philosophy, then they must be basic enough to become primary guidelines for action.

Even without a specific planning or effort, any company will develop gradually a philosophy based on the way they observe people and learn through trial and error. Despite this, in most cases a positive program developed by senior managers, build or refine a fundamental philosophy as an underlying and overriding component for managing the company.

For the philosophy of the company to be truly impactful, it must be expressed in a short, concise and precise way, in such a way that any employee can keep it on their mind when it comes time to make decisions. decisions. It is generally recommended to include a maximum of three points or aspects in the philosophy of the company, mainly because if four or five are added, the retention rate, linked to decision making, tends to decrease considerably.

But this does not necessarily mean that things should be simplified too much, however it is important that the philosophy of the company has a balance. If the philosophy only focuses on the details, it becomes difficult to assimilate and you run the risk that no one really puts it into practice. It is best to have a list of key points as core values ​​and expand each of them into a short paragraph.