During my career, I’ve been blessed to be part of a number of growing companies. I’ve observed an occurrence during times of growth with enough frequency to call it a pattern, at this point. Or, more accurately, a leadership anti-pattern. During a recent meeting, I accidentally gave a name to this pattern: The Values Donut. Today, I want to write a little bit about what it is, some ideas about how it occurs, and some strategies to resist it.

What’s a Values Donut?

A Values Donut is what occurs when, as a company grows, there is excellent values alignment among the most senior leadership and the people closest to the work, but those values aren’t consistently exemplified and operationalized by the layers of leadership in between.

Aren’t company values just a bunch of nonsense, anyway?

Are your personal values nonsense? I’d hope not. The same goes for companies. The best companies are intentional about values, and don’t just pick a bunch of things out of a hat and put the ones that sound the best on the wall. No, the values will likely be a mixture of:

• Observational - Team members are operating on these principles every day, and we’re just giving name to them. These are sometimes referred to as “practiced values” or “core values”.
• Aspirational - We have opportunity to grow in these areas, and we think that the effort spent in this direction is worthwhile, so we want to keep them front and center.

Assuming your company did that, the values are an incredible tool, no matter your role there.

So values aren’t just for putting on posters?

Nope. They’re one of the few tools available to hold leadership accountable, for starters. And good leaders seek accountability, which is why I think the best leaders insist on having, and then lean hard on, values. If we tell our team something we aim to make fundamentally true of us, then it’s fair game for them to point out when that doesn’t seem to be true.

And from the leadership perspective, well-articulated values are crucial for decision-making, and for communicating the rationale behind decisions to your team. At the bottom of every stack of “whys”, be it 5 or 500 deep, will lie something axiomatic. These are the foundations upon which a choice must sit. If one of our values is to be trustworthy, for instance, then it must follow that lying to protect the company is not a choice we can reasonably endorse.

Okay. So values are important. What about the donut? I was promised a donut.

Right, so back to the Values Donut. A company’s values are only as effective as it allows them to be. Think of them like corporate antibodies. They help protect the cells we want to keep around, and drive out the unwelcome entities.

The observant among you might notice that there is significant risk here. When something is intended to mark some things as desirable, and others as clearly out of bounds, we must be very careful what we allow to earn the designation of “value”.

This could likely be the topic of a whole different article, but for now, let’s differentiate by pointing out that values alignment is not the same thing as “culture fit,” and in fact that “culture add” is a far more worthwhile goal in your company’s hiring practice.

• We are trustworthy <– This is a value
• We dress casually/business-casual/formal <– This is a cultural norm

Why “Donut Holes” Happen

I once had a pastor who said “your values are what come out when you get squeezed.” Just like an orange produces orange juice when pressure’s applied, folks will see what your company’s made of when the pressure’s on. And it just so happens that periods of growth are one such moment of pressure, where values will be tested.

It is at these moments that, while the organization stretches vertically, gaps can be left, even if the org chart indicates all positions are filled. This is where your donut holes come from.

Maybe you’re a CEO who waited until it was absolutely obvious that a leader (or several) was needed before beginning the search, whether out of a sacrificial impulse to save money through your own unsustainable working hours, or a desire to maintain tighter control over the day-to-day for “just one more quarter.”

Maybe you’re a VP who was managing a bunch of ICs directly and didn’t realize that you’d need to prioritize a manager or two before expanding the team, and now you don’t have the bandwidth to conduct a longer and more exhaustive search for the right candidate.

In the interest of expediency, you bring in an outside leader who seemes, at a glance, “close enough.” Maybe there’s a sign or two during the interview that this person’s way of operating is very different than the company and the job requires. “That’s okay, they’ll adjust once they’re here,” you tell yourself, because you’re drowning in work and you need the help.

And so, you’ve hired your first donut hole.

Maybe you promote from within, hoping to avoid exactly this problem, but you promote an IC with no leadership experience, and then don’t supply the mentorship and coaching they need to grow into the role because you’re otherwise occupied.

Congratulations, you just created the perfect incubator for a donut hole.

Or maybe, as the company has grown, a leader has caught the scent of opportunity and begun to empire-build, playing politics instead of working for the good of the customers and the company. You know that backfilling for their role will be a headache you don’t need at the moment. Besides, they have a lot of institutional knowledge you can’t afford to lose. So you don’t coach them about it, and you don’t fire them.

With this, like some kind of supermassive star inside the donutverse, this initially promising leader has collapsed into a donut hole.

Donuts Deliver Disillusionment

So, why does the introduction of donut holes hurt your company so much?

You’ve probably heard this before: “People don’t quit jobs, they quit bosses.” There are few things that can more dramatically affect a person’s day-to-day experience of their job than their manager.

Want a surefire way to discourage and eventually drive away your most engaged, tenured, and productive team members as you grow? Hire, promote, or refuse to fire a donut hole.

Why? Because the folks who are there because they believed in the mission of the company and in the values demonstrated by leadership are energized by their connection to those things, and they likely make better decisions because they feel empowered to do so by an understanding of “why we’re here.”

Trace a route from your CEO to any person on the org chart. That line is a power line, where power equals purpose. Interfering with or removing the flow of this current from the org chart puts the next hop on battery power, and the thing about batteries is that they run out. I’ve found that great leaders can act as something of a back-up battery for their teams, for a time, but even the best of leaders can’t deliver power indefinitely, once cut off from supply.

I once had an incredible leader on one of my teams explain that they have a roughly six month lifespan in a role once purpose is lost. That leader has a bigger battery than most I’ve known.

There’s a pretty great article over on Medium from a few years ago titled Your Company Culture is Who You Hire, Fire, and Promote, and while I don’t enjoy the conflation of culture and values in the title, I still consider it a must-read for those in leadership roles. If that’s you, I’d highly suggest you give it a read.

Dodging the Donuts

By this point, you understand what the Values Donut is and have some ideas about how it occurs. But at the beginning, I also promised you some strategies to resist it.

First, we’ll get the obvious out of the way: don’t hire or promote donut holes. If you did that already, coach them if possible, and fire them if not. They’re actively harming your teams while you don’t take action, and you will lose team members as a result, even if it never gets directly attributed to them.

But stepping back from that, there are some things you can do to help your company resist the pull of the Values Donut.

First, ensure you’ve identified your company’s values. This seems simple, but it’s often a fairly involved exercise. Include your team in this identification exercise. There are consulting firms that specialize in facilitating this kind of work, but there are also some great books that can help. Two I personally recommend (affiliate links):

• The Advantage, by Patrick Lencioni
• Traction, by Gino Wickman

Second, ensure your values are an integral part of your hiring and review process. It’s not enough to just add a few talking points during an interview about the values. Yes, you should have a dedicated values interview, but all interviews should be seeking to capture signal about values alignment. Likewise with every performance review. It needs to be made clear that being part of the team means being aligned on the non-negotiables around how this team works. Treat red flags on values signals as showstoppers, and deal with them as seriously, if not moreso, than standard performance indicators.

Third, slow down! Hiring managers, treat that nagging feeling that you absolutely, positively must fill this open req right now as a warning sign that you’re at risk of making a decision driven by scarcity and fear. If necessary, remind yourself of the damage you’ll do to the very people you’re trying to serve if you allow yourself to bring the Values Donut into your organization.

Lastly, share these concepts with your leaders and teammates. Share this article, if you like, to start the conversation. Even if you decide collectively that this entire concept of a Values Donut is nonsense, I hope you’ll have had a great discussion about what matters in your team. And maybe have gotten an excuse to get together over actual donuts.