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Life has structure in threes. A nuclear family makeup is mom, dad, and kids. Democratic governments have 3 branches: executive, legislative, and judicial. Traditional businesses are structured by strategy, operations, and administration. Schools have students, teachers, and administration. There are the 3 Little Pigs, Goldilocks and the 3 Bears, the 3 Blind Mice, and let’s not forget the 3 Musketeers. Each of the 3 are important to the whole. If you’ve ever sat on a 3-legged stool, you appreciate each leg equally. Not one leg is more important than the other. Each must work together to achieve its mission of supporting you.

Cultures are also structured in 3s. Edgar Schein calls them the 3 levels of culture. They are: Values, Assumptions, and Artifacts. If you look at these three levels as a house: values are the foundation, assumptions are the interior, and artifacts are the exterior. Once you understand how these 3 levels structure your philosophy, then you can begin creating your culture.


VALUES – LEVEL 1 (The Foundation)

From a young age, we’ve been inundated with philosophies like respect your elders, tell the truth, don’t cheat, sit up straight, don’t tattle, always do what you say, work hard, and so on. Within those philosophies are the values of honor, honesty, integrity, respect, loyalty, diligence, and hard work.

Our philosophy is formed, shaped, and clarified through our values, and every decision we make is filtered through our values. People value values over life itself. Patrick Henry famously said, “Give me liberty or give me death,” when protesting British rule. Dr. Martin Luther King gave his life for equality. Ghandi put his life on the line for justice. Nelson Mandela dedicated his life to peace. Our values lead us, we won’t compromise them, and they keep us going in hard times. A company’s values are more important than products, services, and trade. Here are 5 reasons why:


People are the most important asset to any business—hands down. When I started my corporate career my dad told me, “Michael, if you take care of people, money will take care of itself.” It makes sense, doesn’t it? Business is people buying, selling, and trading goods and services. Take people away and you have nothing. Look at the common core value of Integrity. Integrity is doing what you say and saying what you do. It’s being the same person in private that you are in public. It’s treating your employees and customers the same. Who does integrity affect? People. If a culture has integrity, people will be valued. Values value people and protect them from being devalued.


When is the last time you had bad customer service? My most recent negative experience was with a pizza shop and a phone company. Both were awful. The customer service reps were rude. They treated me like I was interrupting their day. I felt foolish, undervalued, and disrespected. I don’t want use either company again, and I’m an easy customer to please. I just want people to be respectful and nice. When companies don’t value people, they lose customers and decrease their market value. The opposite is also true. When they live their values, they increase their market value.

When is the last time you had great customer service? One place that continually delivers a great experience for me is Chik-fil-a. They say, “How may I serve you?” If you say thank you they say, “My pleasure.” Every time I leave there I feel honored, valued, and respected. I’ve driven over 30 minutes out of my way to eat at Chik-fil-a, and although I like their food, I go because they value me. By intentionally valuing people they have become the most profitable fast-food chain in the world. Values increase market value.


As teams live the same values they become unified in heart, mind, and purpose. If you and I started a business together and agreed to practice kindness the same way every day, we would eventually be kind the same way. If we added 5, 10, or 100 people to our team and practiced kindness the same way, we would all be kind the same way. People would describe our business as kind. Kindness would unify us in heart, mind, and purpose.

Values also decrease quarreling, backstabbing, and discord. We may disagree on an issue, but our values would lead us to respect each other and either find an agreement or agree to disagree. Disagreements become positive when you value your values. Values create unity and trumps discord.


When I started my business, I thought I’d be master of my decisions. Nothing was further from the truth. The major difference between working for someone else and working for myself was where the responsibility ended. When I worked for someone else, if I did my job and things did not produce, I could blame my leader and feel shallow justification. When I started my business, all responsibility ended with me. I couldn’t look to anyone else when things didn’t go well. I had to allow values like humility, hard work, perseverance, positive attitude, patience, kindness, and preparation to lead me.

True leaders are led by values. By following values, leaders eliminate excuses.  Could you imagine a leader blaming ambition for their lack of progress? What if a leader said cooperation was at fault for poor work?  What if a leader blamed resourcefulness for a fledgling bottom line? We would look at them quizzically at best. We know we can’t blame values because they work. They work in business, family, relationships, and sports. This doesn’t mean they always give us what we want when we want it. It means they always produce the best results. Instead of looking to people to lead us, we need to look our values.


When is the last time honesty let you down? Notice I didn’t ask when is the last time stupidity let you down. Stupidity would be “honestly” answering an 8-month pregnant woman who asks, “Does my belly look big?” What I’m asking about is honesty as in being fair, truthful, and morally upright. When has it let you down? The truth always prevails, it always wins. The truth is not always accepted, but it is the best policy. The truth won’t let you down.

What about other values such as kindness, generosity, self-discipline, perseverance, and positive attitude? When have they let you down? I didn’t ask if these values always gave you what you wanted; I also didn’t ask if people have always reacted well. Values never let you down. They work in every circumstance, situation, and environment. Values are the standard and we can trust them.

Cultures are built on philosophy and defined by their values. Therefore, values need clearly defined. Then they need to be practiced intentionally and protected vigorously. The problem is most companies have a set of values slapped on their wall that aren’t clearly defined and don’t mean anything to anyone. But many leaders puff their chests when talking about their values to outsiders, and their employees roll and eyes and snicker behind the scenes. Another problem in many companies is values are only discussed when somethings wrong. Values are used as a wagging finger to point out mistakes or to make people feel small for shortcomings. This creates animosity, deception, and rebellion in a culture, because if you beat people down long enough, they fight whatever is beating them down. And too often a company’s values become the “bad guys” because of poor leadership.

Values should be clear, defined, and agreed upon. But most importantly, they need to be lived consistently by the culture that espouses them. When they are, they become assumptions.


LEVEL 2 – ASSUMPTIONS (The Interior)

Assumptions are the deeply imbedded beliefs, values, and actions unquestioned by the people in your culture. Your values are what you say you do; your assumptions are what you do. For example, I could call a duck an eagle. I could try to convince you with presentations, advertising, and promotions. I could bribe you into admitting a duck is an eagle. However, a duck is a duck. Your assumptions are your culture, regardless of presentations, advertising, promotions, or bribes. Your assumptions are the walk that either matches or contradicts your talk.

Assumptions are under the surface and create unconscious behaviors by those in your culture. They are the “that’s-the-way-we-do-things-here” behaviors. When you point out assumptions in a culture, people shrug their shoulders and look at you like, “Well, duh.” Positive assumptions are often taken for granted. Negative assumptions, which normally creates an imaginary wall between “us” and “them” or “leaders” and “workers,” are privately discussed which strengthens the imaginary wall. Here are a few examples of positive and negative assumptions.

Positive Assumptions

  • We all work hard
  • We look for solutions to problems
  • We all take pride in our company
  • We treat each other with respect
  • We don’t talk negatively about each other
  • Everyone looks for better ways to do things
  • Everyone respects/likes/appreciates the leader(s)


Negative Assumptions

  • The leaders don’t care about us
  • They say one thing and do another
  • This company is a joke
  • Keep everything status quo
  • Talking negatively to each other is normal
  • Everyone looks for ways to get out of working
  • Nobody respects/likes/appreciates the leader(s)


These are just a few examples, and you can probably name more. Assumptions are everywhere in your organization. You should appreciate them, but do the painstaking work of discovering what they are. We’ve conducted numerous culture surveys in organizations. We start with the leaders and work our way through the rest of the team. In every survey, we’ve discovered disconnects between values and assumptions. This goes for healthy, vibrant cultures as well as unhealthy, degenerating cultures. The difference is in healthy cultures, people feel free to challenge assumptions without fear of being chastised. In unhealthy cultures, people are chastised for challenging assumptions.

The hardest but most important task in creating a healthy, vibrant culture is to make sure your values and assumptions are in line with one another. If your walk doesn’t match your talk, your culture will fall apart. We will talk more about how to do this later, but for now let’s talk about the exterior—artifacts.


The Pro Football Hall of Fame in Canton, Ohio has numerous artifacts. They have old helmets, shoes, balls, pads, chairs, hats, jerseys, and pictures to show the rich history of the sport. Looking at the original helmet next to the new helmet, it is amazing how football has progressed. The artifacts help you appreciate how much time, innovation, and effort has been put into making football a great sport. Because of the commitment and dedication of players, owners, and officials, more artifacts will be enshrined into the Hall of Fame for years to come.

Artifacts are the external manifestations of a culture’s values. Artifacts include items such as clothes, logos, buildings, products, language, folklore, values on the walls, relics, and pictures. When you look at artifacts, they represent what the organization stands for. Look at the following artifacts. For each one, say the values they represent.

In creating culture, you must be intentional about making sure your artifacts clearly represent the values you’re living. For example, I did a cultural remodel at one company and they chose professionalism as one of their values. Professionalism is a great value, but we ran into problems when I asked them about their dress code. Up to that point, they didn’t have a dress code. The owners took pride that they didn’t tell the people how to dress. Jeans, t-shirts, flip-flops, shorts were all welcome. I pointed out that if people see professionalism as a value and it wasn’t congruent with the way they dress, they may lose trust with them. So, instead of creating a dress code, the team decided to define professionalism with relational conduct and not dress code. In fact, they created a disclaimer in case people asked about the way they dressed.  This disclaimer was, “We believe it’s what’s inside that counts.” This phrase bonded them together and they’ve acted to back it up.

Your artifacts will create an external sub-culture for your clients. Music bands are notorious for their “groupies.” Groupies are people who tour with a band, wear their t-shirts, bracelets, hats, and necklaces. They cut their hair like the band, sing their songs, and recruit their friends. Groupies aren’t in the band and most of them never meet the band. They don’t know what is going on behind the scenes. but they follow them wherever they go and look, dress, and act like them. The bands artifacts create an external sub-culture based on what believe the band is like.

When creating or assessing the artifacts in your organization, you want to ensure the artifacts match your values, and your values align with your assumptions. You want the sub-cultures that are created to align with your culture. Great artifacts can help to drive your culture with your employees, customers, and vendors.


Now that you understand the 3 Levels of Culture you will begin to recognize culture everywhere you go. Every time you see values on a wall you should watch the employees to see if they exemplify those values. You should examine the artifacts to see if they remind you of the values. Listen for assumptions and determine if the organization’s walk matches the talk. Understanding the 3 Levels of Culture gives you great power because you will now be able to see holistically. Most frustrations in organizations stem from misalignment with the 3 Levels of Culture. The vast majority of the time, the reason for misalignment is the topic of Step 2—Leadership. Without great leadership, you cannot have a great culture.