- November 26, 2018
- Comments : 0
Why do you need to lead with a purpose?
By Elie Habib, CEO and Executive Coach –
Even companies on a fast growth track – be it from achieving product/market fit, crossing the chasm and entering the hockey stick phase, or offering fantastic customer experience – will ultimately have to strategically assess the future and prepare for it. Particularly as threats and disruptions arise due to increased and fierce competition, increasingly complex channel models, market saturation, shifting customer preferences, and the evolution of the technology lifecycle.
The chief leader of a company or organization must constantly invest time and effort in clearly articulating a higher purpose to his/her team, shareholders, and customers. This action will spark inspired leadership, drive constant learning, motivate and engage employees, strengthen the brand, and ultimately fuel renewable shareholder value – all crucial pieces of a business navigating the aforementioned threats and disruptions.
In his book “People with Purpose,” Kevin Murray interviewed numerous CEOs and senior leaders to better understand the dynamics of purpose and how it can be harnessed and communicated to inspire organizational performance. The crux of his research was the idea that by unifying employees through a sense of clearly-communicated common purpose leaders can increase performance.
Leadership with a purpose and communication of that purpose are key drivers of performance. An inspired and passionate leader must communicate that shared sense of purpose with his or her team, which in turn should lead employees to feel a sense of common purpose that transcends personal aspirations and should create stronger team cohesion. Specifically, by setting a bold vision and well-articulated goals or milestones, a leader is intentionally championing a “drive to thrive” culture rather than an obviously less effective “just survive” culture. And by investing in establishing company values that serve as guideposts for team members in their myriad of functions, a leader unleashes remarkable energy for success and company performance.
Moreover, leaders need to challenge their teams with a meaningful purpose. It should be attainable but challenging so as to create excitement, incite passion, motivate for higher performance, and increase brand value. Additionally, the stated purpose should be clear, simple, and well-articulated in order to appeal to the entire organization and evoke commitment and accountability. Yet, it can’t be so detailed as to create rigidity and squash creativity and innovation.
In a recently published article, “Creating a Purpose-driven Organization”, by Quinn and Thakor in HBR, they discuss the case of DTE Energy’s recorded substantive improvement in employee engagement and company performance as a result of adopting a purpose-driven model and investing in transforming the company accordingly. DTE started by defining a new statement of purpose: “We serve with our energy, the lifeblood of communities and the engine of progress.” Subsequently, the leaders wove the purpose into every facet of the company by ensuring it was communicated and discussed in the various training channels, team meetings, and other events. The article goes on to state that “as people judged the purpose to be authentic, a transformation began to take place.” This transformation can be proven by the following results. “The company received a Gallup Great Workplace Award five years in a row. And financial performance responded in kind: DTE’s stock price more than tripled from the end of 2008 to the end of 2017.”
Historically, leaders and managers use the same techniques gained in business school or learned on the job to motivate people and increase engagement. However, implementing processes, controls, training, and coaching without inspiring people and appealing to their intrinsic motivators will always be limited to short-term results. Once your people have bought into an inspired purpose that meets at the intersection of higher meaning and business interests, they will naturally seek new learnings on their own, look for ways to create new value for customers, and innovate in their respective areas – all because they care.
However, it’s important to understand and accept that not all leaders are born natural communicators or with the ability to relate to a variety of people. As such, developing communication skills and emotional intelligence to find the right words and build the right relationships is essential to vision sharing. Not to worry! These pivotal skills can be developed with the assistance of 3rd party experts, workshops, and continued learning.
In summary, leadership with a purpose and purpose-driven organizations have deep practical implications on business results, from customers loyalty and employee engagement to the bottom line. It all starts with a leader taking the first step towards unconventionally transforming the company. And they shouldn’t wait until things are going badly to take action!