Transcript HIGHER PURPOSE, CULTURE AND GROWTH:

FCS:
HIGHER PURPOSE, CULTURE AND GROWTH:
HOW TO DEVELOP AN EXCEPTIONAL
ORGANIZATION
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Some Stories
Story One
Walt Disney Company: Arrival of Michael
Eisner in 1984
… Results!
What was Eisner’s secret of success?
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From Higher Purpose  Core
Competence  Strategy
 As you read this,
what strikes you
about the
effectiveness of
this snapshot of
the future?
From Walt Disney – An American Original (Pg.246-247), Walt Disney’s original pitch to bankers
before Disneyland was built.
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Story Two
U.S. coffee industry in mid 1980s:
P&G, General Foods, Nestle
Vanishing margins
Howard Schultz:
 April 1986: first Starbucks café in Seattle
Spectacular success!
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What is Starbucks’ Secret?
From the beginning, Starbucks set out to be a different
kind of company. One that not only celebrated coffee
and the rich tradition, but that also brought a feeling of
connection. A place for conversation and a sense of
community. A third place between work and home.
Our mission to inspire and nurture the human spirit –
one person, one cup, and one neighborhood at a
time.
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From “Our Heritage” www.starbucks.com/about-us/our-heritage.
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Questions
Do you know your higher purpose? Does it
inspire you and your employees?
Do you know your growth strategy? Can
you articulate it in 3 bullet points or less? Is it
tied to your core competence and does it
intersect your higher purpose?
Do you know your organizational culture?
Can you describe it? Does it support your
growth strategy?
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LEADERSHIP AND A SENSE OF HIGHER
PURPOSE
What is “higher purpose”?
 A purpose that motivates you to engage in
business practices that fulfill a need for purpose
in life within you and transcend
money/promotions or other purely business
goals.
Leider: “Purpose is the deepest dimension within
us—our central core or essence—where we have
a profound sense of who we are, where we came
from and where we’re going. Purpose is the
quality we choose to shape our lives around.
Purpose is a source of energy and direction.”
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Purpose: Individuals
 High Scores
 Meaning in life
 Happiness
 Life satisfaction
 Life control
 Work engagement
 Low scores
 Negative affect
 Depression
 Anxiety
 Workaholic measures
 Suicidal ideation
 Substance abuse
 Need for therapy
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Purpose: Organizations
Theory
Data
 Higher purpose
 What an organization
stands for
 Moral call to action
 Provides
 Direction
 Prioritization
Organizations of higher
purpose outperform the
market average 8 to 1.
 Inspiration
 Motivation, extra mile
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What Does Higher Purpose do? Our
Findings
• Connects employees to each other, their leaders
and their communities.
• Elicits higher effort from employees.
• Encourages and incents entrepreneurship.
• Engenders trust.
• Creates greater sustainability for the organization
and the communities in which it operates.
The leader’s higher purpose can be a valuable
off-balance sheet asset for the firm.
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U.S. Supreme Court Justice, John
Roberts, In A Talk To Oral Advocates In
2004:
“Those masons—the ones who built the great cathedrals—would spend
months meticulously carving the gargoyles high up in the cathedral,” He
told them, “gargoyles that when the cathedral was completed could not
even be seen from the ground below. The advocate… must meticulously
prepare, analyze, and rehearse answers to hundreds of questions,
questions that in all likelihood will actually never be asked by the Court.
The medieval stone masons did what they did because, it was said, they
were carving for the eye of God… The advocate who stands before the
Supreme Court… also needs to infuse his craft with a higher purpose.
He must appreciate that what happens here, in mundane case after
mundane case, is extraordinary—the vindication of the rule of law—and
that he as the advocate plays a critical role in the process.”
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EXAMPLES OF HIGHER PURPOSE
An example is provided by the testimony given by Henry Ford in
1916-17 in connection with a lawsuit filed by two of the
company’s shareholders, John and Horace Dodge, who were
objecting to the company’s slashing of prices on the Model T
and its plan to withhold special dividends and invest in plant
expansion. We quote Ford’s court testimony from Lewis (1976):
Once on the witness stand, Ford gave answers which – if their
purpose was to please the public – could not have been better
written by any public relations expert in the land.
“Now,” said Elliott G. Stevenson, the Dodges’ truculent
attorney. “I will ask you again, do you still think that those profits
were ‘awful profits?’”
“Well, I guess I do, yes,” replied Ford.
“And for that reason you were not satisfied to continue to
make such awful profits?” the lawyer inquired.
“We don’t seem to be able to keep the profits down,”
apologized Ford.
“…Are you trying to keep them down? What is the Ford Motor
Company organized for except profits, will you tell me, Mr. Ford?”
“Organized to do as much good as we can, everywhere, for
everybody concerned.”
The dumbfounded attorney quit for the day. However, in his need
to prove that a business firm’s primary responsibility is to its
stockholders, he returned to the attack. “What,” he asked Ford, “is
the purpose of the (Ford) company?”
“To do as much possible for everybody concerned,” responded
Ford, “to make money and use it, give employment, and send out
the car where the people can use it … and incidentally to make
money … Business is a service not a bonanza.”
“Incidentally make money?” queried the attorney.
“Yes, sir.”
“But your controlling feature … is to employ a great army of men
at high wages, to reduce the selling price of your car, so that a lot
of people can buy it at a cheap price, and give everybody a car
that wants one.”
“If you give all that,” replied Ford, who must have felt that
Stevenson had admirably stated his policies,
“the money will fall into your hands; you can’t get out of it.”
Interview 3: Another Interview: SandleR,
O’Neill and Partners
 Jimmy Dunne:
 The sacrifice and the reemergence of the firm
 Annual revision of commitments to employees
 Help from other WS firms
http://youtu.be/QpCzszOnYwI
 Why would Jimmy Dunne do this?
 Employee-centricity as a way to build culture
(“what would Jimmy do?”)
 Employee—centricity
customer-centricity
To Higher Purpose to
Growth Strategy and
Culture
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e.g., Creativity
Core
Competence
 Are you better at it
than others in your
industry?
 Does it help you
create multiple
revenue pillars
(access to multiple
products/markets)?
e.g., Film
Value
Driver
 A key
product/
service, or
business
e.g., Eisner’s
strategy
Growth
Strategy
 3 bullets or less
 What color is your
growth strategy?
 Does your culture
support its
execution?
 Is it widely shared in
the organization?
 Is it a source of
profits or cost
savings?
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 Culture to
support strategy
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COMPETING VALUES FRAMEWORK:
If You Want to Lead the Organization,
YOU Must Understand the Tensions
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Windows on Value Creation
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CVF and Leadership Behavior of CEOs
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A Source for Framework
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TO SUMMARIZE…
The Competing Values Framework
aka The Value Creation Genome
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Now and Preferred Culture Profiles
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Collaborate
Create
40
30
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Preferred
10
10
Now
20
30
40
Control
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Compete
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Growth Strategies in Different
Quadrants and for Different
Phases of the Product Life Cycle
Chapter 2: “The Four Colors of Growth”
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MATCHING GROWTH STRATEGIES…
… Product Life Cycle
REVENUE
GROWTH
Internallydriven
product
innovation
Externallydriven
product
innovation
Marketing
innovation
Structural
innovation
Experimental
innovation
Disruptive
innovation
Business
model
innovation
Application
innovation
Process
innovation
Customer’s
technology
adoption
life cycle
Early
period of
high growth
End
of life
Flat growth,
maturity,
commoditization
and market
consolidation
Aging:
main players
unresponsive
to customer
needs
TIME
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Conclusion
Determine
your higher
purpose
Articulate
higher
purpose
Identify core
competence
Link to value
driver and
growth strategy
Do cultural
diagnostic
Determine
desired culture
to support color
of growth
strategy
Articulate intersection
between HP and
growth strategy
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 Questions?
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