Company Values and Gresham’s Laws

There are many ways that good-faith efforts to promulgate Values throughout an organization can be ineffectual—and maybe even do damage—and they’re rooted in the following principle:  “Bad money drives out good.”  That’s the colloquial statement of Gresham’s Law, which comes from the world of economics.

According to Gresham’s Law, when the currency is inflated in year X, the dollar you saved in Year X-1 loses value.  As inflation continues in Year X+1, the value of your Year X-1 dollar drops even further.  And on it goes, with more and relatively cheaper dollars chasing the same number of goods and services, the newer dollars crowding out the older ones, and the currency becoming further debased.  Said another way, bad money has driven out good.

Think about the little exercise we’ve all done where you say a common word over and over and over and over and over again.  What happens after the tenth or twelfth time you say the word?  Right.  It begins to sound like nonsense.  It loses its meaning.  What do you suppose happens to the word Values when it begins to appear on too many walls, on too many flat-screens, in too many webcasts, and on too many meeting agendas?  When too many invocations of Values are chasing the same numbers of ears and the same number of hearts and minds?

At what point do you get to “too many”?  There’s no hard and fast answer.  The important thing is to recognize that such a point exists and to wrestle with the challenge of locating it.  Merely doing that will help you avoid this pitfall.  And human nature being what it is, it will also differentiate you from most other companies.

JG