The idea of a corporation’s “core values” became popular with the 2001 publishing of Jim Collins’s iconic book “Good to Great.” Collins was so eloquent in presenting the idea, that “core values” largely replaced the old corporate mission statement as a company’s defining identity.


I believe in having core values, clearly stated and used as the basis for day-to-day operations. But there’s a problem.


Core values can only go so far in establishing the policies by which a company needs to operate. Over the course of the past several decades, it’s become unpopular to have formal corporate policies in writing – on everything from work hours, to attire to whether people work at desks. 


No one wants to be the rigid fuddy-duddy who hands down all the rules. Formal corporate policies have a 1960s feel to them (and I’m talking the very conservative corporations of the ‘60s, not the flower children out in the streets). With the emergence of the hip dot-com companies and the growth of the Silicon Valley culture, the trend has been toward a much more laid-back, live-and-let-live type of work setting.


Theoretically, this is employee-friendly, because no one is telling you what you have to do or how you have to do it. Presumably, it’s all about results, but along the way, you’re just free to be you and do your thing. 


But there are problems with that. Let me use an example to illustrate:


Recently the daughter of one of my friends showed up at the place where she has worked nearly a decade – wearing black lipstick. She’s had the same boss the entire time, and she’s worn the black lipstick on multiple occasions without anyone raising an objection.


But on this day, her boss didn’t like what she saw, and told her she needed to take the black lipstick off because it was inappropriate for the work setting.


Now the point here is not to argue about whether black lipstick is or is not professional. The point is that, absent any clear policy on the subject, it all became about her boss’s opinion (or conceivably her boss’s mood on that given day).


The fact of the matter is that there are rules, even if you don’t write them down. The unwritten rules arise from the company’s employee culture, or from the opinions of influential people. Maybe you don’t have a mandatory start time in the morning, but it’s common for people to show up at 8:30. If you show up at 9:30, you’re not violating a policy, but you’re running afoul of the culture. You might be doing a perfectly fine job, but you’re still giving yourself a problem you don’t need.


When you leave the rules unwritten, several bad things happen. One is that you lose control of who makes the rules – and believe me, someone will make them. Another is that some people will know the rules better than others. The plugged-in people who are close to the influential people will have a better sense of what they can and can’t do than those who are more shy or on the social outskirts of the company.


The employees who regularly go out for food or drinks after work? They’re going to be more attuned to the unwritten rules than the people who go straight home to their families, or who go work out.


And as we saw from our black lipstick example, employees don’t know how to follow the rules if you’re letting people make them up as they go along.


You do need some policies, but I understand that companies don’t want to follow the strict, rigid model of generations past. So I suggest a particular way of doing this. It involves four columns you create.


The first column, on the very far left, lists your core values. These should be three-to-five key statements that define the principles and beliefs that guide your company.


The second column is for specific rules you make. Is there a standard start time for work? Are neck tattoos OK? Does everyone have to work at a desk? How can flex time be used? Are you allowed to swear? Are you allowed to wear black lipstick? If you think it’s important to be clear about an issue, this is where you make it official.


The third column is called “Rules I Didn’t Make.” This involves best practices and industry standards that aren’t so much your preference, as they are norms for your profession. For example, it’s standard for lawyers to wear suits to work. It’s standard for food-service employees to wash their hands before preparing meals. It’s standard for baseball players to wear uniforms, gloves and caps. You may or may not agree with the rules you didn’t make, but the point is to let employees know these rules apply because of the nature of your work.


The fourth column comes from an idea introduced by Patrick Lencioni, which is that of aspirational values. These are ideas where you might fall short, but you aspire to them nonetheless. For example, you might aspire to never make a mistake when taking care of clients. Now you’re human, so you’re going to make some mistakes, but you should still aspire to be impeccable in your work. Or you might aspire to be professional at all times in your appearance and behavior. Chances are you’re going to slip up at some point, but this is a worthy ideal to which you can aspire.


So, the aspirational values are important, not because people will get fired if they fall short (they won’t), but because you want them to know this is what they should be shooting for.


Finally, there’s the question of things you can’t anticipate. Some years back, when beards were less acceptable than they are now, I was getting ready to take an employee to a client meeting – and I thought he looked unacceptably scruffy. I didn’t want him to go see the client looking like that.


But I had no policy defining “scruffy.” It was just what my gut told me. This wasn’t a good idea. So I asked him to shave.


Now, he could have said, “There’s no policy on scruffy!” And he would have been right. But in this moment I needed him to listen to me. Fortunately, he did.


And for leaders, this is where your emotional bank account with your employees becomes so important. If you’ve consistently treated them with fairness, respect and integrity, then you’re a lot more likely to get their cooperation when that moment comes when you have to ask them to do something not governed by policy – since there’s no way you can anticipate everything that could ever come up – but rather by your own instincts.


We’ll talk more about that in a future piece, but if you’re the kind of boss who has always been good to your people and always had their backs, you’ll probably get their buy-in when you need them to shave or change their clothes, or maybe even wash off the black lipstick.