Companies that execute strategy well define their core values to reflect the relative importance of shareholders, employees and customers. Value statements that list aspirational behaviors are not enough. Core values must indicate whose interests come first when difficult trade-offs must be made.

At some companies, customers come first. At others, it may be shareholders. At yet others, it may be employees. There is no right or wrong choice. Each choice is based on a different theory of value creation but making one and communicating it effectively are essential.