The Economics of Higher Purpose

by Robert E Quinn

  John recognized that the leadership of the firm was not deeply connected with the people. They were not tapping the potential of the organization, and employees tended to make only incremental improvements.

  Soon KPMG launched an effort to find the company’s higher purpose. As we have said, an organization does not invent a higher purpose—it discovers it. In this case, the whole organization got involved in the discovery, which made it easier to connect the people to the discovered purpose. They conducted hundreds of interviews and analyzed the responses. Eventually, they distilled the information into a few words. They found the purpose of KPMG: to “Inspire Confidence and Empower Change.”

  The senior people were excited. At this point, many companies would have given in to the next, natural temptation. They would have announced the higher purpose and marketed it inside and outside the firm. Both John and Bruce knew this would be a grand mistake.

  An organization finds its higher purpose with a goal to inspire and unify, to connect people to the whole. They do not accomplish this through typical administrative techniques. They must follow the principles of authenticity and constancy. People need to believe that the collective purpose is real. They need to see a link between the collective purpose and what they personally do.

  So KPMG asked a new question and launched a new initiative. The new question was “What do you do at KPMG?” and the answer was captured in a video, “We shape history.” It turned out that KPMG had a rich past that was largely forgotten. Among other things, the company had assisted in managing the Lend-Lease Act that help defeat Nazi Germany. It was instrumental in bringing about the release of US hostages in Iran. It certified the election of Nelson Mandela. The company could look back on many great accomplishments, and it began to recognize and celebrate them.

  Evolving

  John and Bruce came to believe that their midlevel managers, trained in accounting, must become purpose-driven leaders. This, however, was a big ask, and resistance was natural. In the meantime, John and Bruce also continued to evolve.

  John identified a key learning experience. In their early efforts to find purpose and connect people to it, he did what Nick Craig warned us about. He brought in a consulting firm to help with the purpose work. Following conventional assumptions, the firm directed them to do work that was analytical and intellectual. The firm spent months doing what their KPMG client expected, clarifying definitions of words like purpose, vision, mission, ethos, and culture. They did not get understanding and engagement, only confusion and boredom.

  Frustrated, Bruce told John that he was not interested in having people do a structural analysis of “The Star-Spangled Banner.” He was interested in having people sing “The Star-Spangled Banner.” He saw all the analytical work as a distraction, a form of work avoidance. Just as Bruce’s mind was opened to a new perspective by his random experiences, John’s mind was opened by this unexpected statement. He said, “Bruce’s words unlocked me!”

  John could see how the conventional perspective usually leads to a lack of engagement. He also knew that leadership is about trust. A leader cannot move an organization if the people do not trust the leader.

  When John was leading the relatively small Washington, DC, unit, he made a point of constantly being with his people. They knew him, and they trusted him. When John became chair of the entire US operation, suddenly he was leading 2,000 partners who did not know him or trust him.

  Intuitively, John knew he had to establish trust, but he had no idea how to solve the problems of distance and time. Shortly after Bruce made the comment about singing instead of analyzing, John began to experiment with risk taking of another form: establishing intimacy by his own storytelling and authentic expression. Like Gerry Anderson, like Jimmy Dunne, and like so many others we have featured in this book, John saw the need to increase his own authenticity and vulnerability.

  John was about to deliver a major address to the 2,000 partners. He was determined to give a unique talk: He would reveal himself. He would tell the partners why he loved the firm and what he believed about the purpose of his life and the purpose of the firm. Then the conventional culture stepped in. Some of the people around him were appalled by the idea and tried to dissuade John.

  John mustered his courage, and he gave the talk. He told stories of seeing people in the firm do remarkable things. He told them why he was at the firm, what the purpose of the firm meant to him. He said that there was a need for “a different kind of conversation.” People needed emotional connections with the partners and the partners needed to share their authentic selves. They needed to tell their people why they loved the firm. Accounting is hard work. There are some bad days, and on those days, people need to know why they are getting out of bed in the morning.

  Creating Purpose-Driven Leaders

  John got feedback that was wildly positive, and the talk became a landmark moment. He said it was “cathartic” for everyone present. “What I was really doing was beginning to create a culture that gave them permission to fully engage as whole human beings. I was giving the partners permission to be who they really are. I was inviting them to create a new kind of conversation. I was asking them to do to their people what I had just done to them.”

  The partners were impressed by the message, but they were still accountants who were coming from the conventional mind-set. We can think about what John invited them to do: create a different kind of conversation, make emotional connections, share their authentic selves, tell why they loved the firm, and give people a reason to get out of bed in the morning. This is not the usual work of managers. It is the work of purpose-driven leaders. John and Bruce knew they had to turn managers into what they were not, and it was not enough to simply ask them to take that on. They knew the partners would need help.

  The company hired an outside firm to train the partners in how to tell their intimate stories and share their purpose. It was difficult work, but success stories began to emerge. Today, partners communicate their personal purpose and discuss how it links to their professional lives. In doing so, they are speaking from a courageous place and modeling authenticity and vulnerability. They are giving their people permission to be whole. They are cascading a purpose-driven, positive culture throughout the firm.

  Summary

  In the principal–agent model, the CEO is the leader who plays the role of the principal, and midlevel managers are agents. The organization presumes that purpose leadership is the CEO’s task. Thus, it does not see the task of purpose leadership shared by midlevel managers. However, when the organization embraces an authentic higher purpose, it sees a surprising pattern emerge. Midlevel employees take on the role of the principal and become leaders who turn the culture into a system that attracts people to it.

  But this role for midlevel managers is not common. We find it counterintuitive to think that midlevel managers, who typically do not have stock options and large chunks of stock ownership in the firm, would behave as if they were ownership-motivated leaders. The sixth counterintuitive step in creating a purpose-driven organization is to turn middle managers into authentic, purpose-driven leaders who act like owners.

  Getting Started: Tools and Exercises

  Hold a discussion and structure it as follows:

  Phase 1. Have everyone read the chapter and write answers to the following questions:

  How many of our people drive to work feeling they are headed to their second home and second family?

  How many of the people in our executive and management workforce are purpose-driven leaders?

  Identify an outstanding example of a purpose-driven leader and describe what they do differently in relating to others.

  Why do many people avoid purpose work?

  In terms of developing midlevel managers, what principles are to be found in the KPMG case?

  Phase 2. As a group discuss the answers to the above questions and develop a set of guidelines for turning midlevel managers into purpose-driven leade
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  CHAPTER THIRTEEN

  STEP 7 Connect the People to the Purpose

  We flew to Atlanta to work with six people from a company that is trying to execute change and move into the future. When we work with companies, we try to introduce the basic concepts and tools from our work in positive organizational scholarship and the economics of higher purpose.

  Often, we find the going tough because executives are suspicious of ideas that violate their conventional expectations. In Atlanta we had the opposite experience. The people immediately took in the ideas and extended them in creative ways. It was a joyful experience.

  This willing reception came about because the people had previously lived through and benefited from a positive transformation. Their unconventional experience had already predisposed them to the positive and inclusive mind-set.

  The company, Interface, makes flexible floor coverings including carpet tiles. In 1994 the CEO, Ray Anderson, had an unusual experience. Here is his account of what happened as he prepared to speak to a group of professionals:

  Frankly, I didn’t have a vision, except “comply, comply, comply.” I sweated for three weeks over what to say to that group. Then, through what seemed like pure serendipity, somebody sent me a book, Paul Hawken’s The Ecology of Commerce. I read it, and it changed my life. It was an epiphany. I wasn’t halfway through it before the vision I sought became clear, along with a powerful sense of urgency to do something. . . . I agreed with his central thesis. . . . Business is the largest, wealthiest, most pervasive institution on Earth, and responsible for most of the damage. It must take the lead in directing the Earth away from collapse, and toward sustainability.60

  As result of this experience, Anderson determined to maintain his business goals while also leading the world in industrial ecology (being friendly to the planet). He had gone through a paradigm shift. Acting on it required courageous leadership.

  Everyone in the company believed that Anderson had lost his mind. When he gave his first public speech about his intention, the people outside the company agreed. Investors also seemed to agree: the stock price fell 40 percent in one day. The company entered a dark valley. But it nonetheless began to move forward, building the bridge as it walked on it.

  Since that time, the company has grown into a billion-dollar operation that does business in 110 countries. It became one of the Forbes Most Admired Companies in America and one of the Forbes 100 Best Companies to Work For. One executive told us the Interface story in detail. He kept saying, with emphasis, “It was a miracle. I lived through it, and it was a miracle.”

  One of the women present understood the concepts of emergence and self-organization and she responded: “I am not sure it was a miracle. We had a purpose, and we made connections. When you make connections, new things grow. You flourish.”

  In her short statement, she captured the essence of why it is important to connect employees to the higher purpose of the organization. When the organization is connected to an authentic higher purpose, culture changes, and people empower themselves to do the right thing. As they move forward, they collectively learn to do what was not previously possible. The organization flourishes because the people go into accelerated collective and individual learning. Afterward, they sometimes lack the language to conceptualize what took place.

  While they may lack the language, they do have the memory. When they hear the concepts related to organizational higher purpose and positive organizing, they are able to extend and apply the concepts. This is why the Interface session was so generative. People who have experienced higher purpose and positive organizing are more prepared to accept the concepts associated with creating positive organizations. They are anxious to increase collaboration.

  As the Interface example suggests, a major challenge is getting the people at the lower levels to envision and understand the highest purpose, getting them, the agents, to act like Ray Anderson, the principal. In the last chapter, we examined the process of enrolling midlevel managers into higher purpose. Few companies do this. In this chapter, we examine the process of bringing the entire workforce, particularly first-line people, to higher purpose. Fewer companies do this. We begin with the insights of a man who has spent his life shrink-wrapping corporate speak.

  Shrink-Wrapping Corporate Speak

  Jim Haudan is the chairman of Root Inc., a consulting firm that focuses on purpose and engagement. Root has gifted artists who take 300-page strategic plans and turn them into a few pictures. This is a process of massive simplification. The people at Root use the pictures to engage people in authentic discussions that become both interesting and generative.

  Jim says that many executives think they are imbuing the organization with purpose when they formulate and communicate a corporate strategy. Typically, brilliant people at the top spend months analyzing and reducing complexity. Then they formulate a plan. Members of the senior team, with help from corporate communications, make presentations of the strategy to people at lower levels. But not much happens; the emphasis is on presentation.

  The frustrated executives think, “If the people could see what we see, they would behave differently.” This is actually a sound assumption—they would behave differently. The unfortunate truth is that the people do not see what the executives see because executives cannot communicate what they see. What they see is a right-brained vision. What they communicate, however, is a left-brained set of words. The words lack authentic passion and the clinical communication of strategy leaves people cold.

  Jim says that moving communication from the linear left brain to the visual right brain reduces vast amounts of complexity. The process of visualization helps people discover, simplify, and communicate the purpose. “When they have a simple visual they begin to see the purpose, they show childlike zeal, they open up and they are willing to learn.”

  Jim tells the story of a major company that had not met its financial plan for several years. It was in the process of transforming from a carbonated soft drink company to a total beverage company. Everything at every level was going to have to change. For example, the unionized truck drivers would have to become salespeople. It was a huge shift in expectations.

  Jim ran a meeting that included a truck driver named Bob. Bob’s every other word seemed to begin with F. From the first moment, Bob made it clear that he was not going to cooperate. Jim put up a simple visual that reduced pages of strategy and showed how the business was going to work. As people examined it, Bob walked over. He suddenly volunteered the information that 55 percent of what was on the truck each day came back. He pointed out that 40 percent of the invoices were wrong. He began to scream about the incompetence of management and how it was going to cost everyone their jobs.

  Then one of Bob’s peers interrupted him and explained that the entire process was undermined by the fact that every day there was a stack of information sheets that Bob threw in the garbage. In fact, he had just done that very thing. Bob stood in stunned silence. Then he said, “Give me back those sheets.”

  In a matter of minutes, Bob, the unreachable resister, discovered how what he was doing was affecting the business, and that discovery changed his attitude. Bob was transformed and became an engaged employee. The process was extended to 32,000 people, and the entire company transformed.

  Jim told us that when transformative learning takes place at the bottom of an organization, it loops back to the top of the organization. When executives see radical change at the bottom, it challenges their existing assumptions. Often the conventional mind-set crumbles, and the positive mind-set emerges. Executives suddenly see resources they never knew existed.

  In this case, the CEO and his team were “dumbfounded” when they discovered the untapped potential in their people. The CEO said, “You know, we’ve spent the last 10 years trying to teach them how to do a better job, assuming they would improve the business. But we never thought to share the business with them and let them take control of improving it.”
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  They had never thought to do that because the idea is counterintuitive. A woman from HR, who was in charge of the process and witnessed the meetings, also explained the executive transformation. She said, “It was welcome to the church.” By this she meant that the senior executives experienced a conversion, a shift from the conventional mind-set to the positive, inclusive mind-set. It was the same transformation we have seen throughout this book.

  Sounding like the above woman from Interface, who understands the power of connections in the emergent process, she went on to say, “We pigeonholed folks according to our perception of their limitations. They had no way to be engaged because we were preventing it. Then, after years, we clarified the purpose, and we watched them connect and come alive. They were full of potential. We had resources in the organization that we could not see and that we had never before tapped.”

  We could extend the woman’s assertion to almost all large organizations. Executives look down at the hierarchy and see many people who bring only their bodies to work. Given what they see, these executives make an assumption that only partially reflects reality. They come to believe that the people in the organization are agents who seek to minimize their personal costs, people who will not engage and bring their discretionary energy to work.

  When executives act on their assumptions, they create organizations that are based on the notion of transactional exchange. They seek to control people by designing systems of external rewards and punishments. “We will give you money and other rewards, and you will do what is in your job description.”

  This basic assumption turns people into robots, yet people do not want to be robots. Seeing no other alternative, they disengage, and a few put their creative energy into disrupting the organization. They become like Bob the truck driver, who threw away his forms. When executives witness this kind of disruption, they make another flawed but comfortable assumption: “The fault is in the people.”