Purpose driven companies see the world differently.
Highly inspirational Simon Sinek has created a strong brand and movement around his “Start with Why” ideology. The most advanced evolutionary stage, called “Teal”, in Frederick Laloux’s organization framework is built around the importance of evolutionary Purpose and Wholeness. In the world of higher and higher standard of living, the role of Self-Actualization in Maslow’s hierarchy gets more and more on people’s agenda every day.
Daniel Pink’s motivation theory says that human beings have an inner desire to work on something that matters for the world, other people and everything around us. Simon Sinek explains this same phenomenon with the biology of the human brain. Before entering our rational thinking and rational part of our brains, all signals first go through the emotional limbic part of the brain. This limbic part controls our behavior and decision making to large extent. Hence, according to Sinek, it’s crucial to “start with why” since people get excited of your company/product/service not because of what or how you do it, but because of why you do it. People get connected and want to do business with people who believe in the same things as they do.
The reason for existence for traditional companies is typically tied around growth, profits, shareholder value and competitiveness. Quarter economics with stock market dynamics and short-term incentives schemes have been a strong catalyst for this phenomenon going hand in hand with the Command/Predict & Control management model (blog No 5) and Carrot and Stick motivation model (blog No 7).
Purpose driven companies see the world differently. Their key obsession is not about competition or growth. Companies are not pursuing or focusing on profits, instead they see profit as a side product of doing the right things in the right way. Company’s operations and decisions are based on the company’s purpose, their reason for existence (that is different than monetary drivers alone). Purpose driven companies are more like a living system, an entity with its own energy, identity, creative potential and sense of direction. These companies often do not have a traditional strategy process. No one at the top sets the course for others to follow alone. Organization’s purpose and broad sense of the direction is clear for everyone and is evolutionary updated all the time. These companies are typically very good at sensing the environment and adapting their operations accordingly.
Paradoxically, setting pure growth and profit focus aside and taking a strong stance for something that really matters for the world, might lead to amazing success and brand that customers deeply engage to. For example, Patagonia, the outdoor clothing brand has stated that it’s in business of saving our home planet. And they have truly walked the talk; limiting growth by repairing and selling second-hand clothes, giving away part of the profits to environmental grassroot organizations and for example giving away the total of $10 million of sales on black Friday to save our planet through environmental organizations.
Obviously, finding a purpose that truly resonates and makes a difference is not easy. A good purpose shall be valid at all levels, so that all employees across the company could feel the same purpose statement relevant, meaningful and touching their daily activities. Same purpose should be relevant for all the stakeholders; customers, shareholders, partners, investors and so on.
To our own experience it’s not easy to generate a proper and valid purpose for an organization. We intentionally use the word “generate”, since we feel it is not a good approach to “define” a purpose often by the top management of the company. A good purpose would have a natural process of emerging from the whole organizations. Nevertheless, there is always a risk that the Purpose becomes something artificial, naive and is felt somehow superimposed. On our journey, we have been aware of the importance of Purpose for a long time, but we haven’t still been able to make this piece of the puzzle really come through.
In the earlier guest blog from Mats Lindblom we got to hear about the interesting journey of Meridium company. Laloux thinking and “Teal” ideology has been the compass for Meridium for many years and they have had a strong strive for putting People and Purpose at the center of their operations. In his blog Mats summarized his learnings: “Clear purpose is essential. Everyone shall be part of creating the joint purpose”. Meridium has been successful at living and breathing their own Purpose both inside the company and in all their customer interaction.
Meridium Purpose is part of their overall framework of the soul of the company. Involving all the employees into the process, Meridium has described their Purpose, Mission, Values and Beliefs as follows:
To build the most appreciated digital services and help people in their daily life. Build beautiful and rich interfaces as well as advocate uncompromising simplicity. This by putting the user in focus, basing decisions on data and focusing only on assignments that are meaningful to us where we can contribute and make a difference. We believe in cooperation as well as daring to challenge our own existence and the roles that are needed to create value and drive development forward.
As mentioned earlier, it has been hard for us to generate an all-encompassing Purpose so far. What makes it difficult are the circumstances and context. Finding a good, touching and valid purpose for Greenpeace type of organization is different than doing that for a digital service company delivering customer projects. However, because Purpose is important part of the overall puzzle, as the first step we have used a personal perspective for this part. In practice meaning that Jaakko has been stating that for him personally the drive and purpose in our CEM journey comes from following 3 things:
• We are building a workplace and community where everyone of our 600+ colleagues can live the most fulfilled life.
• The service we deliver is of highest importance for our customers’ success. We are helping our customers to survive in the global competition and hence enabling our society to prosper.
• We are changing Tieto as pioneers and showing the new ways of working, impacting the life of our 14 000+ colleagues.
We have felt it has been better not to superimpose something by force, but better to wait until it will emerge further. We have a strong belief that the organization will help us evolve our purpose.
With passion and humility,
Jaakko Hartikainen & Mikko Virtanen
Our blog series:
No 1: Call for Paradigm Shift in Management
No 2: Magnitude of Change when Shifting Management Paradigm
No 3: Why do so many companies manage people like machines and why is it one of the biggest problems of our times?
No 4: How to drive paradigm level change? Our learnings and one crucial breakthrough innovation
No 5: Incredible India and breaking the hierarchy
No 6: Management paradigms in a nutshell, inspired by Frederic Laloux's book Reinventing Organizations
No 7: Our unforgettable journey to trust, transparency and eventually success
No 8: We all know that “Carrot and Stick” model is outdated — Why is it so damn hard to implement new ways?
No 9: The Power of Purpose
No 10: Finding your purpose and living your life with it can unleash tremendous potential
No 11: Organization as living organism and complex adaptive system
Jaakko Hartikainen is a senior business leader with broad experience in building next generation digital services, agile way of working and new business models. His passion is to place humanity at the heart of everything and build sustainable success for increasingly complex world by empowered people and teams.