BJ Bueno

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Our firm uses core values to help companies attract more profitable customers. Over time, we’ve discovered that our readers are predominantly inspired leaders. Core values play a major role in inspired leadership.

BJ Bueno joined Life is good CEO Bert Jacobs on the main stage of the National Retail Federation’s Big Show this past January to illuminate the powerful effects core values can have on today’s businesses. Core values helped Life is good build a $100 Million lifestyle brand.

Their talk, rated the highest of all keynotes given at NRF this year, is available to watch here. To assist you in the process of discovering your core values, today we offer you the ultimate guide for creating core values. We hope you enjoy.

What Are Core Values?

Core values are part of a company’s DNA. While serving as a compliance advisor for the best offshore sportsbooks in the region, a governance team translated what an organization stands for into a clear, testable set of behaviors and skills, reinforcing that values lie at the core of a company’s culture. Values are fundamental, enduring, and actionable.

Driving priorities and decisions, values help determine how a company spends its time and money. The actual values of an organization are determined mainly by where it invests its resources and how its employees behave, not what the leader says or what’s posted on company walls.

When properly executed at the leadership level, core values play a fundamental role in attracting and retaining talented employees, making difficult decisions, prioritizing resources, reducing internal conflict, differentiating the brand, and attracting the right breed of customers.

Why Corporations Need Core Values

Human capital is the lifeblood of today’s enterprises. Attracting top talent in a fast-changing global marketplace—and retaining them—takes more than high salaries and benefits packages. Talented people want to work in environments where they can develop and thrive. Top performers seek out organizations with values that match their own.

As a consequence, the importance of a company’s culture is becoming more apparent.  Numerous research studies have highlighted that corporate culture is a primary driver for innovation.

When core values are successfully integrated into an organization, they set the foundation for their culture. Values set the climate of the workplace and help determine how success is defined and measured.

12 Reasons Core Values Are Important for CEOs

Taking core values serious is a major organizational initiative. Wondering if establishing an authentic set of core values can impact your business?

Here are 12 reasons CEOs should take core values seriously:

1. Core values can set a foundation for the organization’s culture.
2. Core values can improve morale and can be a rich source of individual and organizational pride.
3. Core values can align a large group of people around specific, idealized behaviors.
4. Core values can guide difficult decisions by determining priorities in advance.
5. Core values can help positively influence how employees interact with one another.
6. Core values can help you attract, hire, and retain the right type of employees.
7. Core values can help you assess performance (both individually and organizationally).
8. Core values can help prevent conflict and mitigate conflicts that do arise.
9. Core values can help you improve innovation.
10. Core values can help differentiate your brand in the minds of your customers and partners.
11. Core values can impact how the organization serves its customers.
12. Core values can help you attract the right breed of customers.

Examples of Core Values From Successful Companies

Core values are the standard operating principles that guide an organization’s culture—its employee’s behaviors, attitudes, language, and focus.

Here are over 100 examples of values from 12 organizations that value their company’s culture:

Google’s Ten things we know to be true

1. Focus on the user and all else will follow
2. It’s best to do one thing really, really well
3. Fast is better than slow
4. Democracy on the web works
5. You don’t need to be at your desk to need an answer
6. You can make money without doing evil
7. There’s always more information out there
8. The need for information crosses all borders
9. You can be serious without a suit
10. Great just isn’t good enough

Zappos Family Core Values

1. Deliver WOW Through Service
2. Embrace and Drive Change
3. Create Fun and A Little Weirdness
4. Be Adventurous, Creative, and Open-Minded
5. Pursue Growth and Learning
6. Build Open and Honest Relationships With Communication
7. Build a Positive Team and Family Spirit
8. Do More With Less
9. Be Passionate and Determined
10. Be Humble

Whole Foods’ Core Values

1. We sell the highest quality natural and organic products available
2. We satisfy, delight and nourish our customers
3. We support team member excellence and happiness
4. We create wealth through profits and growth
5. We serve and support our local and global communities
6. We practice and advance environmental stewardship
7. We create ongoing win-win partnerships with our suppliers
8. We promote the health of our stakeholders through healthy eating education

Amazon.com’s Leadership Principles

1. Customer obsession
2. Ownership
3. Invent and simplify
4. [Leaders] are right, a lot
5. Hire and develop the best
6. Insist on the highest standards
7. Think big
8. Bias for action
9. Frugality
10. Vocally self critical
11. Earn trust of others
12. Dive deep
13. Have backbone; disagree and commit
14. Deliver results

The Container Store’s Foundation Principles

1. 1 Great Person = 3 Good People
2. Communication IS Leadership
3. Fill the other guy’s basket to the brim. Making money then becomes an easy proposition.
4. The Best SELECTION, SERVICE & PRICE
5. Intuition does not come to an unprepared mind. You need to train before it happens.
6. Man In The Desert Selling
7. Air of Excitement

IKEA’s Core Values

1. Humbleness and willpower
2. Leadership by example
3. Daring to be different
4. Togetherness and enthusiasm
5. Cost-consciousness
6. Constant desire for renewal
7. Accept and delegate responsibility

Netflix’s Culture: Behaviors and Skills They Value

1. Judgment (making wise decisions; identify root causes; think strategically)
2. Communication (listen well; concise speech; respectful)
3. Impact (amazing amounts of important work; consistently strong performance; focus on results, not process; bias to action, not analysis)
4. Curiosity (learn rapidly; seek to understand; broad knowledge)
5. Innovation (re-conceptualize issues to discover practical solutions; challenge prevailing assumptions; create new ideas that prove useful)
6. Courage (say what you think; make tough decisions; take smart risks; question actions inconsistent with their values)
7. Passion (inspire others with excellence; care intensely about company success; celebrate wins; tenacious)
8. Honesty (candor and directness; non-political; quick to admit mistakes)
9. Selflessness (seek what is best for Netflix; egoless when searching for best ideas; help colleagues; share info openly and proactively)

Southwest’s “Live the Southwest Way”

1. Warrior Spirit (Work Hard; Desire to the best; Be courageous; Display a sense of urgency; Persevere; Innovate)
2. Servant’s Heart (Follow the Golden Rule; Adhere to the Basic Principles; Treat others with respect; Put others first; Be egalitarian; Demonstrate proactive customer service; Embrace the SWA Family)
3. Fun-LUVing Attitude (Have FUN; Don’t take yourself too seriously; Maintain perspective (balance); Celebrate successes; Enjoy your work; Be a passionate Teamplayer)

The Ritz-Carlton’s Service Values

1. I build strong relationships and create Ritz-Carlton guests for life.
2. I am always responsive to the expressed and unexpressed wishes and needs of our guests.
3. I am empowered to create unique, memorable and personal experiences for our guests.
4. I understand my role in achieving the Key Success Factors, embracing Community Footprints and creating The Ritz-Carlton Mystique.
5. I continuously seek opportunities to innovate and improve The Ritz-Carlton experience.
6. I own and immediately resolve guest problems.
7. I create a work environment of teamwork and lateral service so that the needs of our guests and each other are met.
8. I have the opportunity to continuously learn and grow.
9. I am involved in the planning of the work that affects me.
10. I am proud of my professional appearance, language and behavior.
11. I protect the privacy and security of our guests, my fellow employees and the company’s confidential information and assets.
12. I am responsible for uncompromising levels of cleanliness and creating a safe and accident-free environment.

Under Armour’s Brand Values

1. Let’s be great. Build great product, tell a great story, provide great service, and build a great team.
2. Integrity. Without it we cannot be a team.
3. No one person is bigger than the brand—Team. No athlete either.
4. Make one dollar spend like three. We must be creative with the resources we have.
5. Help others. Volunteerism and serving others are vital parts of our mission.
6. Walk with a purpose. Everything we do is part of a deliberate, long-term strategy/vision. Know where you’re going.
7. Protect the UA culture, but embrace change. Evolve and innovate. We’re a different company every 6 months, and we can’t use culture as an excuse to not change product, process, or people.
8. Be humble and stay hungry. Nobody’s going to give us anything. We have to earn it every day.

The Motley Fool’s Core Values

1. Collaborate: Do great things together.
2. Innovate: Search for a better solution. Then top it!
3. Fun: Revel in your work.
4. Honest: Make us proud.
5. Competitive: Play fair, play hard, play to win.
6. Motley: Make Foolishness your own. Share your core value _____________.

Zipcar’s Core Values

1. Obsess about the member experience (Build trust and confidence among our member community by delivering leading convenience, dependability and service excellence)
2. Be the best we can be (Support personal growth, impact, and excellence)
3. Deliver results (Create enduring value through growth)
4. Keep it simple (Win through simplicity and continuous innovation)
5. Have an impact
6. Change the world through urban and environmental transformation

Notice how all of the above values are specific and actionable. They help define each company’s culture and encourage a specific type of behavior within each organization.

Seven Steps to Discovering Your Company’s Core Values

As the CEO and leader of your enterprise, this process begins with you—your interest, passion, and commitment to establishing a set of values that will guide your culture through decades of growth.

Taking the time to define your values, embody them, and to keep them fresh and alive in everyone’s minds are some of the most vital things you can do to promote a thriving culture.

Arriving at a concise and short list of values can be a daunting task. You can find lists of 300 values to choose from. However, we don’t advise using any predetermined lists.

Why? Values aren’t selected; they are discovered. Freely associating in a brainstorm sessions with your employees will invariably yield superior results.

Ready to get started? Here are seven steps to creating distinct and meaningful core values that will serve as a foundation for your corporate culture:

Step 1: Begin with a Beginner’s Mind

It’s too easy to presume we know the answer at the start and to therefore never truly embark on a creative discovery process. Adopting the the mind of a beginner—someone without any preconceived notions of what is—gives you access to more ideas and a fresh perspective on your business.

This is an important step in any kind of discovery process. In our firm, everytime we begin a new creative project or the discovery of psychologically-driven consumer insights for clients, we always start with a Beginner’s Mind.

We believe it is imperative to approach the discovery of core values without any preconceived notions and beliefs about your culture and your business. Simply taking a deep breath and momentarily clearing your mind may be all that’s needed. Remembering that your conscious mind doesn’t know all of the answers is helpful too.

Step 2: Create your own master list of internal values.

The more experienced and engaged employees you can enroll in this initial process, the better. Set up meeting with your leadership team first. Have everyone list what they believe to be your company’s imperatives, ideal behaviors, desired skills, and greatest strengths.

Ask:

• What do you believe defines the culture at [company]?
• What values do you bring to your work that you consistently uphold whether or not they are rewarded
• What do you truly stand for in your work? What do you believe [company] truly stands for?
• What do our customers believe about us? What do they believe we stand for?
• What values does our company consistently adhere to in the face of obstacles?
• What are our company’s greatest strengths?
• What are the top three to five most important behaviors we should expect from every employee (including you)? “Actual company values are the behaviors and skills that are valued in fellow employees,” explains Netflix CEO Reed Hastings.

Your goal is discover the pre-existing values within your organization (assuming you’re not an early-stage start up). It will be difficult to reinforce values that aren’t already part of your organization’s ethos. It’s best to highlight your organization’s current strengths and build on them.

While some companies hire an outside consultant to help uncover their core values (which is appropriate at times), it is vital that you as a CEO are playing a role in facilitating the discussion. Your employees need to see that you’re taking this process seriously and that its not just some “corporate agenda” for appearance purposes. If you don’t take this process seriously, it’s unlikely your employees will.

If you are going to lead the discussion, however, be sure that you’re not shaping the conversation or influencing people’s answers.

Step 3: Chunk your values into related groups.

Combining all of the answers from step 2, you now have a master list of values. If you and your team took this process seriously, you may have between 25 and 75 values. Obviously, that’s far too many to be actionable and memorable.

Your next step is to group these values under related themes. Values like accountability, responsibility, and timeliness are all related. Group them together.

Step 4: Highlight the central theme of each value group.

If you have a group of values that include honesty, transparency, integrity, candor, directness, and non-political, select a word that you feel best represents the group. For example, integrity might work as a central theme for the values listed above.

This process is best done with a small team, but this brainstorm session can be an open meeting as well.

Step 5: Sacrifice and Focus.

Now comes the hardest part. After completing step 4 you still might have a sizable list of values. Here are a few questions to help you whittle your list down:

• What values are absolutely essential to your work environment?
• What values represent the primary behaviors your organization wants to encourage and stand by?
• What values are essential to supporting your unique culture?

You can’t be all things to all people. Your culture is unique. It should emphasize what matters most to your collective. It should highlight what makes your organization a place that talented people want to work. It should represent both your current and ultimate expression of your culture.

Strong values require difficult decisions to be made in order to uphold the values. Avoid prosaic or generic values (often listed in a single word, like “accountability”) because they won’t establish a strong, distinct culture.

In reviewing the cores from companies like Google, Zappos, and Amazon, you’ll notice that some of them are unconventional, even controversial. These values help create unique cultures. For example, Amazon.com’s “Have backbone; disagree and commit” is not a common core value for a multi-billion dollar retailer, but I bet this principle plays an important role in Amazon’s culture.

How many core values should your organization adopt? Too few and you won’t capture all of the desired behaviors and unique dimensions of your organization. Too many and your employees will get overwhelmed and they will lose their overall impact. While the number of core values differs for each organization, the magic range seems to be between 5 and 10.

Step 6: Craft Your Company’s List of Core Values.

Now creativity really comes into play. You’ll notice in the core values examples from successful brands that none of them list their values in a single word like Integrity, Accountability, or Fun. While a one-word value might be easier to remember, it is difficult for a single word to become a distinct expression of your culture. More importantly, it is incredibly difficult for a single-word value to trigger an emotional response with your employees.

Highlighting values into memorable phrases or sentences forces your organization to more succinctly define the meaning behind each value. It gives you the opportunity to make the value more memorable in the minds of your employees.

Be sure to enroll at least one strong writer from your team in this stage of the process. Here are a few tips and guidelines for crafting your values:

• Use inspiring words and vocabulary. Our brains are quick to delete or ignore the mundane and commonplace. A phrase like “Customer Service Excellence” is not going to inspire you or your employees. Zappos’ “Deliver WOW Through Service” just might.

• Mine for words that evoke emotion. Words and phrases that trigger emotional responses will be more meaningful and memorable in the minds of your employees.

• Focus on your organization’s strengths. It’s fitting that a company like IDEO would promote principles like “Encourage Wild Ideas” and “Build on the ideas of others.” Play to your strengths in crafting your values.

• Make it meaningful. Slogans and taglines are not core values. Make your value statements rich and meaningful to your employees.

Step 7: Test the Ecology of Each Value.

Once you’ve finalized your list of core values, it’s time to test.

Here’s a quick checklist to test the integrity of your new core values:

1. Will each value help you make decisions (especially the difficult ones)?
2. Are your core values memorable? Will every team member be able to encode them in their minds?
3. Does each value represent distinct elements of your overall culture?
4. Does each value speak to at least one desired behavior?
5. Will you be willing to uphold these values 50 years from now?
6. Are your values congruent with the behavior of your leadership team? Are these values BS-tested? Will an employee be able to observe hypocrisy?
7. Can your organization hold up these values in stressful and difficult situations (like increased competition, product recall, stock devaluation, or downsizing)?
8. Are you willing to defend these values unequivocally? That is, does each value permeate through the entire organization?

How to Make Your Core Values Stick

Studies show that values have to be internalized by employees and integrated into the culture for them to have a meaningful impact. Here are eight tips on making this happen:

1) Clearly define, explain, and articulate your values to your employees.

Most of the core values from the organizations we’ve studied are backed by significant context for each one. This might take the form of a one paragraph description, a company video, or a slideshow to bring each value to life. The more depth, texture, examples, and images you can give to each value, the more power they will have.

2) Educate your organization on your values.

This is vital. If you don’t constantly educate your team and reinforce the importance of your values, they will become mere slogans and will not influence company culture. Hold a special company meeting denoted to rolling out and discussing your new value. Make your values an on-going part of your corporate dialogues.

3) Hire employees who embody your values.

If you’re doing a good job promoting, educating, and embodying these values as an organization, talented people aligned with these values will likely seek you out. Either way, it’s imperative that you hire for the attitudes and behaviors that shape your culture. If not, your new hires will only weaken your organization—no matter how talented they might be.

4) Defend and uphold your corporate values.

If you’re going to establish core values that define your corporate culture, what are you going to do when an employee clearly doesn’t honor them? You can’t change a person’s values; you can only hire people who share the same values. If you don’t let this employee go, what message are you sending about the importance of these values? Your core values shouldn’t be altered in difficult situations like economic downturns. These values were established as a guidepost to see the organization through both calm and rough waters. Your values should be timeless, sustainable, and unchanging.

5) Reinforce your values with consistency.

Using values in your business is like any other business discipline. All disciplines require consistency and practice.

• Distribute a copy of your core values to every employee.
• Create poster boards that highlight each value and hang them around your offices.
• Reference the values in meetings; they need to become part of how everyone behaves and makes decisions.
• Reward, recognize, and celebrate employees and teams that exemplify the company’s values.
• Make sure you and your leadership are modeling behavior based on your values. If not, your values will lose their power and will not stick.

6) Bring your values to life through storytelling.

Keep your values fresh and relevant. Employees will ignore a wall plaque within days, if not hours. Continue to challenge yourself to find ways to keep your values fresh and alive in your employees’ minds. Take note when employees and team members are actualizing the values. When you reward and recognize these behaviors, be sure to share it with your organization. Ask employees to share stories of how they saw one of their core values in action within the past week. Storytelling of this nature is one of the best ways to encode these values in your employees’ minds and to give them a life of their own.

7) Make sure leadership embodies each value.

Recognize and rate your leaders and employees on how well they embody the core values as part of performance reviews. If the leadership of your enterprise doesn’t live the core values, you can’t expect that your employees will.

8) Promote your values on your website.

Remember that actualized corporate values will act like a homing beacon for talented people who share your values. The About Us or HR section of your corporate website is a great place to highlight the unique features of your culture. (See below for excellent examples.)

With intention, energy, and a healthy dose of creativity, your values will remain relevant and meaningful. Keep the story alive. Discover your culture’s shared values and live them every single day. It will lead you to a stronger organization.

How Brilliant Brands Use Their Corporate Websites to Attract Talented People

Can we determine which companies take core values seriously just by looking at their websites? Can we get an accurate feel for a business’s unique culture from the web? In many (but not all) cases, the answer is “yes.”

It’s also not too difficult to determine which companies aren’t taking core values seriously. Many corporations have a page on their website that lists its vision, mission, and values in their About or Human Resources section that lacks passion, emotion, creativity, and uniqueness. It’s as if a single company executive filled out a form in an effort to complete an assignment.

Remember that authentic corporate values will act like a homing beacon to talented people who share your values. The About or HR section of your corporate website is great place to highlight the unique features of your culture. It’s a simple tactic that too few businesses are using.

Here are a few noteworthy examples:

• Zappos Family Ten Core Values has received significant attention in the media, partly because CEO Tony Hsieh set out to build his company around a particular culture and used these core values as an instrumental tool.
• The Container Store’s What We Stand For demonstrates how the company puts employees first and how it seeks to actualize its seven foundation principles. No wonder they are ranked one of the top 100 places to work by Fortune magazine year after year.
• Whole Foods Market’s Mission and Values section of their website shows they have invested resources in clarifying why they are in business and what’s most important to them. They are clearly attracting individuals who share their social mission.
• Southwest Airline’s The Southwest Way is perhaps the quintessential example of a distinct company culture that lives its unique and playful set of values.

Notice that companies that are actively using core values to support their corporate culture tend to provide significant context for each of their chosen values. Beyond a simple word or phrase, they can clearly define what their values mean to them. And, that helps bring their values to life.

Naturally, the organization’s practices—both internally and externally with customers—must be congruent with their shared values. You must first discover your core values and the make them stick.

While an attractive culture section of your website obviously isn’t enough to lure talent,  showcasing your values and the unique elements of your culture is a powerful and often underutilized tool for recruiting and attracting talented employees.

Should You Promote Your Corporate Values to Your Customers?

Our discussion on the importance of core values has focused on the benefits and application in cultivating a distinct corporate culture. But what is the relationship between core values and your customers?

Your core values define the ideal behaviors of your employees and the principles by which your organization operates. Some of these values may be relevant to your customers, others are not.

So should you promote your core values directly to your customers? Generally, the answer is no. But, there are exceptions.

Zappos, for example, has built their brand around their ten core values. They go so far as to print one of their ten values on every package they ship to their customers, highlighting the importance they place on these values.

There are three benefits to this approach: (1) It makes Zappos stand out as a unique brand and not just another online retailer; (2) it works to attract customers that share the same core values;  and (3) it helps the company attract employees that share their values.

But for the most part, customers don’t specifically need to know your corporate values. If they’re interested, they’ll Google you.

Your customers do, however, need to observe how well you actualize your core values on a subconscious level. If you have a core value of “Wowing your customers,” wow them. If you have a tenet of putting your customers first, put your customers first. Not living up to your values won’t just impact your company culture; it will hurt your relationships with your customers.

Corporate Values versus Brand Values

Values extend in two directions: Inward to influence and guide the company’s culture and outward to communicate to its customers.

The inward direction, as we’ve seen, is discovered by the organization itself. The outward direction is based on the collective consensus of the business’s customers.

Branding, remember, is a co-authored experience with your customers. Your customers will determine for themselves what they believe your organization values based not just on what you promote or say, but on what they observe and feel.

Let’s make a distinction between corporate values and brand values: Corporate values are determined by you. Brand values are influenced by you, but largely determined by your customers.

The experience they have in their interaction with your brand will determine their perception of your brand’s values. If those perceived values are consistent with their own, they are more likely to do business with you. (And our firm as observed an unquestionable correlation between values alignment and customer loyalty—especially in cult brands.) If, however, those perceived values are in discord with their own, they may actual despise your brand.

Examples of Brand Values from Successful Businesses

While you may have anywhere from 3 to 12 shared values in your business, your customers will likely define you by a single value.

For illustration purposes, below is a list of successful brands and the brand value most likely perceived by their customers.

It’s difficult to get your customers to associate your brand with a specific value. It certainly doesn’t happen by accident. It takes a consistent branding and marketing strategy, executed year after year.

But more than that, the company itself must find ways to live the value they represent. For as soon as they don’t, that position will begin to wither in the customers’ minds.

Upholding that value, however, places the company is in a unique position in the marketplace, one that its competitors have difficulty breaching.

Who would have thought values could be the ultimate competitive advantage?

Inside Cult Brands: Loyalty and the Power of Values

While the importance of core values is continually gaining traction within the business community, there’s one group of businesses that has been hip to the idea for decades.

Cult Brands—brands with an unusual level of customer loyalty and an established community of engaged fans—almost always have well-established core values. (See Examples of Core Values From Successful Brands above.)

Why is this so? Customers rally around certain brands because they believe those brands stand for something meaningful to them. That is, customers become more loyal when they believe a business shares their values.

And while marketing messages and other branding efforts can help communicate these values, if these values don’t genuinely exist within the corporation itself, customers eventually find out.

In order for a business to effectively communicate its values to its customers, these values must be expressed throughout each customer touchpoint. This includes every potential interaction customers have with employees—whether in person, on the phone, via email, chat, Twitter, or Facebook. And if employees aren’t living these values—if the corporate culture isn’t consistently actualizing them internally—the gig is up.

Core values offer savvy CEOs a powerful way to unite both employees and their customers under a common flag. They can help you retain talented people and attract more loyal customers.

The Ultimate Approach to Core Values and Brand Values

The task of discovering a corporation’s core values is generally conducted within the organization. While some companies hire consultants to help unearth their values, the source of input is almost always the executive team. The Seven Steps to Discovering Your Company’s Core Values is a process any CEO can lead his or her team through whether it’s a 10-person startup or a 20,000-person multi-national empire.

But there’s a vital missing ingredient in the process of discovering core values and brand values: input from the customer.

Why would you want to get your customer’s take on your values?

Two reasons:

First, you understand that the purpose of business is to create a customer, as Peter Drucker noted. Your customers are the reason for the existence of your organization. Shouldn’t their input matter?

Second, your customers—the ones who genuinely care about you, at least—already believe that your organization upholds a certain set of brand values. This is vital information for the initial stages of your discovery process.

Think of your customers as a large consulting team ready to give you feedback and an outside perspective based on their experiences and interaction with your organization. What better stream of insights can you hope to tap?

How to Mine Your Customers for Core Values and Brand Values

Only surveying your customers about what they believe you value isn’t likely to yield meaningful results. The concept of values are too abstract for many people; too much explanation and discussion is needed to make a direct fill-in-the-blanket question effective.

Determining your brand values and assessing your core values, however, can be accomplished using more advanced psychological methods involving direct interaction with your best customers.

Your customers’ input can bring the added magical ingredient in your efforts to discover your core values, and especially your brand values. Be sure to bring your customers into the discussion.

Need help unearthing your core values and your brand values? Drop us a line.