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Working with the YouGov polling agency Kevin researched 1884 managers and 2100 employees, as well as conducting 30 face to face interview with CEOs.
Kevin and YouGov devised a “Purpose-Focused” polling method and approach which has been patented and which is now available as a powerful research tool for individual CEOs and companies.
Kevin said, “While it is valuable to understand current trends and insights, all senior managers are mainly interested in the performance of their own businesses. Now they can use a range of Purpose-Focused criteria to develop strategies and improve performance among leadership teams and throughout their organisations.”
Kevin’s latest research is into why purpose is so important and effective – for individuals, teams and organisations. This research taps into the strong, current and growing debate on this subject among businesses, their stakeholders and observers. An old truth is being re-discovered and Kevin’s research unveils the deeper issues beneath the soundbites. He set about identifying and researching the key criteria which are essential for a thriving and purposeful organisation.
His research underpins his new book, “People with Purpose”, key findings of which include:
- The nature of the gap between how managers see themselves as leaders and how their employees do
- What behaviours employees want from their bosses
- How neuroscience validates the importance of purpose
- How the debate about short-termism is being distorted
- The growing support for integrated company reporting
“Simple, clear purpose and principles give rise to complex, intelligent behaviour. Complex rules and regulations give rise to simple, stupid behaviour.”
– Dee Hock, founder and former CEO of Visa International
Leaders who make purpose the beating heart of their organisations create more and more effective leaders, more engaged employees, more committed customers and more supportive stakeholders. By doing this, they create greater value, as well as thriving businesses, communities and environments.
As I have discovered while researching my new book “People with Purpose,” leaders everywhere are paying more attention to purpose, and increasingly understand how and why their purpose must be more widely beneficial than simply to make profit and provide a return to shareholders.
Of course, making a profit is crucial, but awareness is growing that today you have to create value for a wider range of stakeholders, and clearly communicate what that value is, if you want to continue to grow. Businesses that express their purpose in a way that shows how they improve people’s lives do much better than their peers, by 400 per cent. Organisations with a shared sense of purpose outperform those with no sense of purpose, on both hard, financial measures and soft, intangible measures.
One reason is because employees with purpose are more motivated and deliver better results. Leaders who make people’s work meaningful, and make their people feel worthy, inspire their people to be more passionate, engaged and flourishing employees, driven to make a difference.
I interviewed more than 30 CEO’s from a wide range of companies for my book and they tell their own stories about how they have used a purpose framework as a ‘North Star’ for long and short-term decision making. They talk about how purpose has encouraged their people to look for solutions that deliver durable value and returns. These are leaders who have used powerfully articulated purpose statements to bring companies back from the brink of collapse, or rapidly grow businesses into global giants, or simply enable their organisations to thrive over long periods of time. They describe how purpose has helped them to transform performance, motivate people through meaning, not fear, and create cultures of high energy and high performance, often from the very edge of disaster.
From what they have said, and from my study of countless purpose statements, I find that when you combine purpose, values and goals into an integrated framework, and communicate it all on a single page, you create a powerful tool that can help you deliver a more agile, empowered, energized and aligned organisation – the prerequisites of high performance.
Whether you are a CEO of a large organisation, a leader of a division of that business, or a leader of a small team, the benefits are the same and the principles are the same.
Research commissioned by the EY Beacon Institute among 500 global business leaders, and conducted by Harvard Business Review Analytic Services (HBRAS), highlighted how global executives view the power of purpose to grow and transform their organisations. It also realised that purpose was a powerful but vastly underutilized asset.
The institute found that:
•Most executive believe purpose matters: 89 per cent of executives surveyed said a strong sense of collective purpose drives employee satisfaction.
•84 per cent said it can affect an organisation’s ability to transform;
•80 per cent said it helps increase customer loyalty.
•However, only a minority of executives said their company currently runs in a purpose – driven way:
•Only 46 per cent said their company has a strong sense of purpose; and 44 per cent say their company was still trying to develop one.
So, the challenge is not having a strong purpose, it is in how to generate a sense of purpose that is truly shared by everyone in the organisation. Here’s what the best leaders were doing:
THE KEY INCREDIENTS FOR A PURPOSE FRAMEWORK.
1.A long-term vision
A long-term vision gives employees a sense of security and this has a powerful impact on their engagement. If you want your people to have a greater sense of purpose, you must give them an audacious goal 10–20 years away – so audacious it gives them a sense of urgency today. If you want to transform the world, you better get started right away.
2. For a truly authentic purpose, start with the customer to truly engage with people inside and outside your organization
Defining common purpose is a key task of leadership. Purpose stays constant while strategies and practices constantly adapt in a changing world. Research shows that leaders who focus their purpose on making customers’ lives better are more likely to inspire truly customer-centric staff, who work hard to keep those customers coming back, thus outperforming competitors. Only by meeting the needs of customers can you fulfil the wider purpose of creating value for all stakeholders.
3. Culture is your competitive edge.
Organizations with a winning culture have given people a shared purpose, shared values and shared goals. Those organizations with rich, healthy cultures achieve income growth seven times higher than those with less well-defined cultures. As a result of their strong cultures, those companies are also better at attracting the talent that enables them to keep generating growth and value. Leaders must choose their values with care, and use them to drive conversations everywhere about not only their purpose and goals, but also the way in which they will be achieved.
4. Strategic Priorities
To achieve your three-year ambition requires you to focus on no more than five or six strategic priorities – fundamental things you have to get right in order to achieve your revenue, profit and relationship goals. These will be high-level tasks that will take you at least three years or longer to achieve, but which are the building blocks of success.
All subsequent operational; or tactical planning and resource allocation decisions will be based on these strategic priorities. Defining these will enable you to decide which projects or initiatives to continue and which to stop or delay. If this or that project does not help you to achieve one of your strategic priorities, then why are you doing it? Defining these goals is to bring your strategy to life, and enables employees to understand the various initiatives that are under way, what those goals will contribute to the vision, and why they are of value to the organisation.
Success, however, depends on ensuring that employees have an understanding of and a commitment to corporate goals, as well as an ability to set their own goals to align with those corporate goals. And they must be regularly reviewed. Understanding goals is one thing, but feeling that you can do something about them is even more important.
5. Use your ‘Purpose on a Page’ to have the powerful conversations that embed vision and values and align the organization
Without alignment, the best strategic plan will never be fully achieved. Alignment is the glue that binds an organization to its purpose, its values and its goals and enables it to get things done faster, with less effort, and with better results. However, you cannot create a fully aligned organization if you don’t spend the time aligning and enabling your managers, so that they can have the purposeful conversations that embed a sense of purpose in every employee. Unless you do this, your vision and values break down at the front line. Here, employees see only the gap between your aspirational language and their daily working lives, and they become cynical rather than motivated.
When articulated and communicated well, a purpose framework can help to direct, align and inspire the right actions on the part of large numbers of people. Without this, change programmes quickly dissolve into a list of confusing, competing and contradicting projects that absorb time and money and take you nowhere at all. When you combine purpose, values and goals into an integrated framework, and articulate it all on a single page, you create the tool that liberates high performance.
To download the True North Diagram go to the ‘Speaker page’ Downloadable Resources section.
In business, culture is your competitive edge – and leaders who pay attention to culture achieve superior results. Here are some things to do to ensure a strong culture.
Organizations with rich, healthy cultures achieve income growth seven times higher than those with less well-defined cultures. As a result of their strong cultures, those companies are also better at attracting the talent that enables them to keep generating growth and value.
Leaders who pay attention to culture achieve superior results. This was the finding from research I did among 30 CEO’s for my new book, People with Purpose. I also commissioned special research from global online polling company YouGov, among 1900 managers and 2200 employees.
What became clear is that leaders who create strong cultures do so by articulating a set of values that they live by, and then making sure their managers and people live and breathe those values too. They make those values central to creating a shared sense of purpose with everyone in the team, as well as ensuring everyone is working to an aligned set of stretching goals.
With the health and growth of their businesses at stake, it’s no surprise that trying to achieve this can take every waking moment.
Follow these tips from CEOs who have focused on culture to enable success:
1) Think carefully about your values
Ensure that they reflect the DNA of your organization and that they encourage the behaviours that will enable you to achieve your goals. Too often, leaders describe values without sufficient explanation to have meaning, and that cannot truly drive culture.
Dame Louise Makin, CEO of specialist health-care company BTG, says: ‘I honestly believe that the absolute key to our success is the quality of our people and the way we conduct our business. Everything we do is guided by our values, which we long ago designed to underpin and foster a culture that would enable us to grow fast and be a meaningful company. Every step of the way we have made sure that we have had, at our core, integrity, teamwork, accountability, delivery, openness and continuous learning as our values.’
2) Put your leaders on the front line
To understand the culture and what changes are necessary, leaders must spend time on the front line of the business.
Vernon Everitt, MD of Customers, Communication and Technology for Transport for London, describes developing the culture as being all about trying to see life through the eyes of the customer. To do this, TfL has initiated a ‘front-line experience’, where all the senior leadership have to spend at least two weeks of the year out in the field, acting as a revenue inspector on the Tube, or on the bus service, or mopping the decks at one of the piers where the river boats turn up. ‘It’s only by doing this, by standing shoulder to shoulder with staff, that we can truly understand their experience and help them deliver a better service.’
3) Create a strong set of values to empower and energize people
Your culture – the way you express your purpose and values to employees – should enable everyone in the organization to make decisions in your absence, based on knowing what you would do.
Organizations that create more leaders are more agile. To create more leaders, you need to empower more people to make decisions without always going up and down the management chain. To achieve this, leaders need to provide a resonating purpose and clear principles.
In 2010, Debbie Hewitt MBE was appointed to help turn around the failing Moss Bros Group. At the heart of the company’s recovery has been the motivation and ethic of its people. ‘The previous mission statement didn’t engage or energize our people,’ says Debbie. ‘It wasn’t the reason people came to work every day. We needed to describe it with more emotional language – to make men feel amazing.’
4) Make sure middle managers live the values
Managers either enable or kill the values you want lived in the organization. Employees, no matter how keen, will not be able to live and breathe your values if your managers don’t. No matter how much the top team lives the values, if your middle managers are not doing so as well then culture breaks down.
Killian Hurley, chief executive at Mount Anvil, a specialist property developer in London, says: ‘One of our core values is to relentlessly strive to do the right thing. That means when we are hiring people, one of the qualities we are looking for is decency. We want people who, when faced with tough choices, will do the right thing. We absolutely know that the right thing to do is the best thing to do.’
But YouGov research shows that many employees do not believe their managers actually care about the purpose of their organization, nor do they believe that many of their managers live the values of the company. It is here that culture breaks down, and employees become cynical about the company’s values. Unless all managers also live the values in their actions and words, it is impossible to deliver the strong culture that can be such a competitive edge.
5) Beware of barriers that prevent people from living the values
Nothing kills engagement and motivation faster than inconsistency. Too often, leaders accidentally put policies in place that prevent employees from living the values. When you remove the barriers, and encourage the values, you can transform performance.
At Odeon and UCI Cinemas, poor performance was linked to employees’ general lack of any sense of shared vision, common culture, or faith in their leadership. ‘We actually put barriers in their way when we asked them to live our values,’ describes former chief executive Paul Donovan. ‘For example, we had a policy that wouldn’t allow our employees to see any new film for the first two weeks. When customers came in and asked about movies, staff just shrugged. They couldn’t say anything.’
Improvement has stemmed from the creation of a very clear vision and values: ‘We want our staff to be film fanatics, committed to delivering excellence through teamwork, in an informal and empowering environment, which will allow their passion to shine through.’
6) Your values bond customers to the brand
Your values bond customers to the brand, so make sure there is consistency between your internal culture and external expectations.
Steve Hood, chairman and chief executive of Trust Ford, the dedicated Ford dealer group, says: ‘If you can embed your values in everything your employees do, you can create a differentiator for your brand. Your culture is hugely important, both for attracting the right employees and winning and keeping customers. If you don’t have engaged employees living your values you’ll never retain your customers.’
David Statham, managing director of Southeastern Railways, fully agrees: ‘The values you choose and live are crucial to your success. Happier customers give us long-term security’. To achieve happy customers, David explains, ‘You can’t make rules for every single circumstance. You have to provide a framework that enables employees to make individual decisions every single day. You can only do that by instilling in them a sense of personal purpose. The people who travel on our networks are our colleagues, families, friends, neighbours. So it’s all about looking after people we know. Everyone has an opportunity to make a difference.’