One of the things that helps us understand the book of Proverbs is context. When we read this proverb, we need to grasp again the idea of context here. We know that not all kings love lips that speak what is right. Not even all kings listed in the Bible felt this way - in fact far fewer appreciated truth in their people - than those who ruled from a standpoint of falsehood. But when we remember the previous verse - we see why this passage is here. Since a divine decision is in the king's lips - those who realize their power that derives from God will love those who advise them to be truth speakers.
Many a king has been destroyed by ungodly advisors. Those who are merely sycophantic suck-ups will come to the king and speak whatever is easiest to him. The problem with this is that often a king has to make rulings that don't make everyone happy. He will have to establish law that will help reign in the natural, selfish and self-centered nature of men. Without righteous laws - the kingdom will implode due to the inwardly explosive nature of sin. More than implode - his kingdom will collapse from the lack of character that comes from not dealing with sin in our lives. The fall has made us prone to ungodliness - not godliness. Thus a godly king who speaks and hears the truth is a wonderful thing for any nation to have. Such kings are bred in a hothouse of truth - not in a darkened mansion of lies and flattery.
Since my guess is that none of us are kings who read and study this verse, what implications and instruction does it have for us? First, it reminds us of the importance of who we consider our counsellors. Do we love those who speak the truth to us? If we do not, we will be liable to having fair weather friends who only say to us what is pleasing at the moment - and who do not warn us of when we are lacking character and godliness in our lives. That can prove disastrous to us if we are not careful. Second, we should look at and examine what kind of friend we are to others. Earlier when I spoke of the kind of leeches that suck-up to those around them - was I speaking of the way you are with your friends. Do you love them enough to speak the truth to them? Are you willing to possibly have your friendship cooled for a period because you are a "TRUE FRIEND" who lets them know when sin is leading them down a bad path? This is where we can take the general truths of a passage and apply them to our own lives. Granted I figure that few of us will ever be pulled into the inner circle of a major ruler or government official. But if we do, it is my hope that we will be so used to being the right kind of friend that little will change in regard to how we speak the truth in love for their benefit.