How to make your people 30% more engaged, 29% more joyful and 26% more productive. Easily.

What powers the performance of the most successful companies on the planet? What do they know that is lost on so many slow-moving traditional organisations?

It’s a question that we have spent the last couple of years researching with leading institutions including the Universities of Cambridge and Plymouth.

It’s a question we think we may have answered.

The purpose gap

That answer, of course, is rooted in the cultures of these organisations. Culture is unique to a particular organisation and takes years to build. But what if the key elements of how agile entrepreneurially-minded organisations behave could be codified and therefore replicated? What if it could be understood ‘at source’?

 

there’s a missing link between Purpose at the top and how it is received in the real business

Yes, it’s about clarity of purpose and that’s nothing new – 90% of CEOs now claim to be actively engaged in implementing or exploring Purpose. But it’s more nuanced than that. In large organisations, beset by complexity and legacy-thinking, there’s a missing link between Purpose at the top and how it is received in the real business.  That gap doesn’t appear in the best entrepreneurial businesses.

By studying the very best entrepreneurial thinking, combined with cutting-edge academic research, we believe we’ve identified why that is. It’s not about having a social purpose – it’s what you do with it.

Our research identifies 9 key attitudinal behaviours which drive business productivity and performance. And, in entrepreneurial businesses, these behaviours appear to be the outcomes of an actively engaged purpose. The key question is what is the source of these productive behaviours – and what is the missing link in more hierarchical, corporate organisations?

 

It’s not about having a social purpose – it’s what you do with it.

It’s clear that these ‘entrepreneurial’ behaviours are, to some degree, suppressed in most corporate organisations.  And the source of this appears to lie in a weakness in three key cultural markers; ownership, trust and contextual clarity. Research suggests that Purpose in the absence of these is unable support the positive performance behaviours typical in an agile culture.

A lack of ownership, trust and clarity creates a gap between purpose and people in the business.

 

And that’s where the Contexis Index® comes in. By understanding the cultural relationship between purpose and performance and codifying this, our research creates a tool that any business can use to transform its human capital and organisational performance.

The Index is a measurement tool that provides robust metrics that reveal how Purpose is working and where its effect is blocked.  It employs rigorous scales to assess a broad range of organisational performance metrics and links these back to Purpose through a defined set of cultural characteristics. The Index provides these metrics, in detail, by demographic (age, sex, seniority, time in business etc.) and location.

Data for the Index is gathered via a simple on-line Survey. Results are provided in a detailed Report with data presented graphically together with detailed analysis and recommendations. This will enable you to design highly targeted interventions to bridge the gap with a great deal of confidence since they are based on reliable empirical data.

And can the gap be bridged?

So far, the results of the initial companies to take the Index, whether they are entrepreneurial businesses or complex corporates, have been remarkable.

Purpose does drive performance. But only where it is activated.

Activated purpose leads to an average increase (over the median employee) of 30% engagement, 36% in openness to new ideas, 29% in joy and 26% in performance. And the results are showing how this activation is achieved and how to bridge the gap between stating a purpose and bringing it alive in the business.

As Rupert Lee-Browne, CEO of FX group Caxton, observes “Without Purpose, a company can only flipflop around without truly consolidated, effective effort. What Contexis has developed with its Index is a very clever way to measure the impact of Purpose on Performance, enabling companies to really motivate their teams. Contexis Index did it for Caxton”.

And this is where you come in..

We are now ready to open the analysis to the next tranche of companies. We have the research funding to conduct a pro bono analysis of a limited number of organisations and we are looking for some specific types and scales of organisations. I’d love to hear from you if you would like to know more.

By undertaking this analysis, you will develop remarkable insights into how purpose is working in your organisation and to what extent the key markers of ownership, trust and contextual clarity are activating purpose across the business.

You will also be supporting important research by contributing wholly anonymised date to the University of Cambridge.

To find out more about how the Contexis Index can transform the impact of Purpose in your business and how you can help in this important research please contact me at jrosling@contexis.com.

To find out more about the thinking behind the methodology you might enjoy this short EthWord film 

 

John Rosling is a writer and lecturer on entrepreneurship, CEO of Contexis and Head of Thought at the Contexis Index; ever curious as to how entrepreneurial thinking is the key to activating purpose, stimulating agility and velocity and fulfilling human and commercial potential in global organisations.

 

Photo by David Iskander on Unsplash


The awesome productive power of keeping the main thing the main thing

In his 2015 book Thirteeners Daniel Prosser makes the claim that 87% of businesses fail to execute their strategy each year. The colossal waste in money, energy and simple human joy behind that statistic is shocking. And it reflects the much-quoted earlier work by Kaplan and Norton (The Execution Premium) that 90% of strategies fail to deliver all their goals.

If this is true, just what is going on? How can this be commercially sustainable? How can highly skilled and highly paid executive teams in leading global companies be getting their basic strategy wrong 9 times out of every 10?

The truth, of course, is that they don’t. Both Prosser and Kaplan/Norton are regularly misquoted.  In the shock of the statistical carnage it’s easy to overlook the important little words “execute” and “all of their goals”.

But we still have a problem. And, in an increasingly volatile and ambiguous business world, it’s a fatal handicap to future business performance. It’s not the formulation of strategy that’s at fault. It’s the inability to execute.

According to the Economist Intelligence Unit, 87% of CE Suite say executing strategic initiatives successfully will be essential for their organisations’ competitiveness over the next three years.  Yet 61% acknowledge that they struggle to bridge the gap between strategy formulation and its day-to-day implementation.

Having lost sight of our objectives, we redoubled our efforts Walt Kelly

In most organisations, a huge amount of energy and investment goes into strategy design and formulation. But that’s not where the problem lies. In almost all cases, it’s in an inability to execute that kills the strategy.

It’s a problem of clarity and prioritisation, with a multiplicity of competing objectives paralysing management’s ability to act decisively and strategically.

A problem of engagement, with management, overwhelmed and unclear of priorities, disengaged and unwilling to take responsibility for fear of sanction

And a problem of communication, with line management unable to articulate strategy and align staff behind it.

“Fewer than 10% of employees report that they understood their company’s strategy” Kaplan & Norton The Execution Premium

It’s not a problem you find in the best entrepreneurially-minded businesses.

Over 20 years of working on strategy with both the best entrepreneurial businesses and the biggest corporate businesses, we have observed a fundamental difference in the cultural approach to strategy between the two.  And I believe that difference is at the heart of the costly execution problem in corporate business.

That difference is as simple as this: fast-moving, entrepreneurially-minded businesses actively engage their people at every level so that they not only clearly understand strategy but take ownership of it.

Of course, that’s easily done in a small or flat structure. But this is not just a matter of structure and scale. It’s a matter of human beliefs and behaviours.  It can and does work in organisations of any size. But it requires a complete change of attitude.

Key to this approach is having management first identify and emotionally engage with the purpose that exists behind the strategy. This starts at the top but ultimately needs to happen at every level required to execute the strategy. It’s a radically different approach to the imposed top-down, ‘strategic launch’ approach of most large companies.

“High performance people do better work if they understand the context…the best managers figure out how to get great outcomes by setting the appropriate context, rather than by trying to control their people”. Reed Hastings, Netflix

By first understanding the context (the ‘why’), it’s far easier to take ownership and responsibility for the strategy (‘what’ needs to be done).  By then working through a structured process of prioritisation it’s possible to see with clarity how this can be achieved for that particular management team or business unit.

That resolves the first execution problem of a lack of clarity, with competing objectives paralysing management’s ability to act decisively and with velocity – and that can be critical. As Baum and Wally conclude in their work “Decision Speed and Financial Performance ‘there is a particularly clear association between strategic decision-making speed and subsequent commercial performance’.

And there’s a second feature of entrepreneurial management teams that has been lost in traditional corporate hierarchies; trust.   A lack of trust leaves middle management unwilling to take responsibility for fear of sanction and creates the familiar sclerotic cultures of endless meetings and analysis which are the hallmark of a culture fundamentally unable to take responsibility. After any time spent in a typical UK corporate it will become abundantly clear why high-trust cultures are 50% more productive (Paul Zak).

Clarity of context and a culture of trust also resolve the third problem of strategic execution; communication. If management are confused as to the purpose the strategy serves and unwilling to take responsibility for it, they can hardly be effective in communicating it to, and inspiring, their teams. It’s hardly surprising that, in most organisations, the vast majority of employees haven’t the first idea of what the strategy is – and that’s a major disincentive to effort and commitment.

Entrepreneurial management has long been adept at navigating the kind of volatile, uncertain and ambiguous business world corporate organisations are increasingly having to face. In this new world companies with a desire to survive need to learn the lessons of contextual clarity and trust that allow entrepreneurial businesses of any size to be strategically agile, adaptable and fast.

But for that to happen someone in the organisation needs to take some self-responsibility for changing how things are done. And that will never happen..

 

John Rosling is a writer and lecturer on entrepreneurship, CEO of Contexis and Head of Thought at the Contexis Index; ever curious as to how entrepreneurial thinking is the key to activating purpose, stimulating agility and velocity and fulfilling human and commercial potential in global organisation

 

Photo by Josh Spires on Unsplash


Our TOP FIVE articles on Love

Sometimes it seems as if the idea of talking about love in a work situation can bring people out in a rash.  It’s just not British is it?  Much less challenging to talk about ‘engagement’ or ‘commitment’.

But whatever we call it, most people would thrive in a workplace underpinned by compassion, kindness, gratitude, fairness, patience – and that’s love isn’t it?

We’ve pulled together five of our favourite articles and videos on this topic for those of you up to it.

 

Is talking about love at work the ‘final frontier’? We have lots of love for The Eth Word, and this is a particular favourite.  Ruth Ibegbuna, CEO of RECLAIM, says we get far more from one another and experience ‘a higher level of interaction’  from a foundation of love. and so we can thrive in the workplace.

Brian Draper shared an experience on Thought for the Day of working with a global organisation to help their people ‘become more human’ (the mind boggles!).  “My colleague wondered whether they could explore the subject of love,” explained Brian. “There was an awkward pause. Followed, by nervous, and then uproarious, laughter”.  In most large global businesses the response would be much the same.  In these organisations the concept of love is irrelevant.  But it doesn’t have to be so.

 

“There is IQ and there is EQ,” ​Ma says​. “But more important is LQ. You can become a money machine, but what’s the use of that? If you’re not contributing to the rest of the world, there’s no LQ …”
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Still find yourself apologising when you use words like compassion and kindness?  But if you don’t have love how can you have trust?  John Rosling explores this in a 1 minute watch.
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Plenty, argues Wendy Lea.  When you have such a strong connection to a mission or idea that it inspires you to take risks, your company can soar and your customers benefit.  Love is what drives us all: a feeling of connection to a mission or idea that is so strong that it inspires us to put ourselves on the line, and gives us the courage to create something from the ground up.
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 Photo by Nathan Lemon on Unsplash

Why are corporates so hopeless at innovation (and entrepreneurs so good at it?)

Here’s a story we all tell ourselves. Big companies are slow, risk-averse and shackled by process. That means they can’t innovate which strangles growth and value. Entrepreneurs are fast, open to opportunity and free of corporate baggage. That means they innovate and create huge value. QED.
 
Neither story is necessarily true, of course. But we see evidence to support our beliefs everywhere.  The fact behind the myth is that there is a major problem in all but exceptional corporates in making entrepreneurship work.
 
Actually most corporates are stuffed full of entrepreneurial brilliance

Big companies have so little confidence in their ability to innovate that they spend huge amounts of their shareholders funds in attempting to bring entrepreneurship in from outside. Most have tried buying thrusting businesses and found it is almost always a disaster. Some have attempted Entrepreneurs in Residence but this is usually the route to a padded cell for the appointee. Increasingly we see big companies attempting to insulate the entrepreneur from their atrophic culture by forming arms-length partnerships and sponsorship programmes which can work but often result in hilarious clashes in culture between the corporate and the start-up (once described as the bland leading the blind).

The question that exercises me is WHY?

Why, given the absolute imperative to change, are most (not all) corporates so hopeless at creating innovation, drive and creativity? In a word entrepreneurship?’

How a team reacts under pressure is critical to determine how they behave in real situations and is quite new as a way of looking at team dynamics.

It’s a question I believe has now, at least in part, been answered by some quite brilliant research conducted in the US to describe how teams of people work in different organisations. There are two stand-out reasons why this research is brilliant:

  1. It’s new and is based on real neuroscience (what is actually going on in the head of your people), rather than the ‘observational’ approach of most organisational modelling from Jung onwards.
  2. It’s based on what happens when the Team is under stress or pressure. And that is critical to determine how they behave in real situations and is quite new as a way of looking at team dynamics.

So, how does this address the problem of entrepreneurship in organisations? Not surprisingly, those you would think of as entrepreneurs behave very differently to those you would pigeonhole as ‘corporate’. In fact, under pressure, they work in a diametrically opposed way. Hence the frustrations of entrepreneurship in large organisations. Hence the tendency for entrepreneurially minded people to quit. Yet it turns out that by showing people exactly how they are behaving you can enable them to choose a different path. You can re-programme the behaviour of individuals and teams and make it OK to be more entrepreneurial, faster, more innovative – but stay feeling safe.  We call it Agile Teams. The impact can be extraordinary.

It turns out that by showing people exactly how they are behaving you can enable them to choose a different path.

How can a team be helped to chose a different path?

To begin to understand this you have to imagine how teams behave under stress by visualising a circle or clock-face. Corporate teams typically move defensively, in an anti-clockwise direction, moving from concept or idea into evidence-based research in order to validate that idea, then to test it out in a controlled environment to prove it works, and only then to roll it out expecting users to adopt it when they’re actually being forced to comply. This creates little to no buy-in and often results in failed adoption. This is the classic command-and-control, micro-management process. It is a fear-based approach that reduces personal risk but removes choice and attempts to force participation.

Entrepreneurial teams typically move more offensively, in the clockwise direction. A new idea or challenge is shared with the team, which engages to provide feedback and input which refines direction and contributes missing considerations. Once a team of people who share the same ambition join together, put the concepts into action they then evaluate the outcomes against the team’s original intentions and then iteratively work together to make adjustments to the assumptions until the full value of the original concept gets realized. This is a trust and choice-based approach that enrols people’s participation based on their excitement for the project.

Corporates tend to put great value on planning and analysis prior to committing, which means they often move slowly and can get left behind. Entrepreneurs tend to move quickly based on minimal information. They are willing to make mistakes and learn from them, they’re agile and adjust course often, working in a state of continual improvement.

This new way of understanding how teams respond to daily business challenges has already had a dramatic impact on team performance in the few UK companies so far exposed to it.

What this shows is that in order to adopt the best of entrepreneurial thinking and application may not be as hard as the myths would suggest. That actually most corporates are stuffed full of entrepreneurial brilliance. It’s just the way teams have been taught to work that is suppressing it. And if that is true, companies like Google, Lockheed Martin and Spotify that have learnt to release the entrepreneur within may quickly become the rule and not the exception. And that really would be a revolutionary thought.

If you’re interested in learning more then get in touch. We’d love to hear from you.  And you might be interested in these articles:

The secret behind Collier International’s global revenue performance

Is being entrepreneurially minded the only survival strategy?


Our TOP FIVE Articles on Trust

Building a culture of trust makes a meaningful, measurable difference to companies and yet, according to PwC’s 2016 global CEO survey, 55% of CEOs think that a lack of trust is a threat to their organisation’s growth.

There is also nothing soft or altruistic about it; creating trust is a major driver of exceptional productivity and efficiency.  There is also nothing easy about it. To create a culture built on trust requires a conscious and courageous choice for senior management, backed up by consistent and sustained focus. 

We’ve pulled together five of our favourite articles on trust to help and inspire.

 

Rethinking Trust 

Roderick Kramer argues that human beings are naturally predisposed to trust – it’s in our genes and our childhood learning – and by and large it’s a survival mechanism that has served our species well. That said, our willingness to trust often gets us into trouble.  So why do we trust so readily, why do we sometimes trust poorly, and what can we do about it?

 

The Neuroscience of Trust 

Paul J Zak has been researching the relationship between trust and economic performance since 2001, both mathematically and behaviourally, and his article for HBR summarises the last ten years of neurological research as well as identifying eight management behaviours that build trust. 

 

This Polish company shows how to destroy Command and Control 

Corporate Rebels tell the story of a remarkable organisation that is challenging the status quo of how work in Poland (and in the world) is organised.  They show once again that giving employees lots of freedom, trust, and responsibility can lead to amazing things.  And, as if that wasn’t enough, they introduce us to the idea of the company wallet

 

Can we make it safe (again) for CEOs to Lead with Purpose 

Shortly before the end of the second World War, Fortune published a statement by a forward-looking group of American CEOs called ‘A Framework for a Postwar Economy’.  The third sentence began “The Economic System is a tool for achieving the common good….”.   Profitability without advancing the common good was failure. Today’s social and economic context is, once again, forcing business leaders to rethink what they were taught about the purpose of business.  And CEOs need to talk about their company’s purpose – not just as a philosophy, but as a strategic tool that helps guide business choices.

 

The Trust Dividend

70% of Americans hate their job.  A terrifying 19% admit to actively sabotaging their employer.  How can we turn this around and start to build the high trust cultures that will enable entrepreneurial teams and businesses to prosper in a volatile and ambiguous world?  Trust engages and emboldens talent, fosters ideas and innovation and attracts customers.  And trust starts with the individual and their willingness to take responsibility.


Our pick of the best FIVE articles for purpose-led leaders in 2017

Read, digest and critique our pick of the best 5 articles for purpose-led leaders in 201​7.

1.  The Aspen Institute: ​Can We Make It Safe (Again) for CEOs to Lead with Purpose?

Shortly before the end of the second World War, Fortune published a statement by a forward-looking group of American CEOs called A Framework for a Postwar Economy​”​​. The third sentence began, “The Economic system is a tool for achieving the common good..”  Profitability without advancing the common good was failure.

Today’s social and economic context is, once again, forcing business leaders to rethink what they were taught about the purpose of business. ​And CEOs need ​to talk about their company’s purpose, not just as a philosophy, but as a strategic tool that helps guide business choices.

 

2.  ​Havard Business Review: The Neuroscience of Trust

Building a culture of trust makes a meaningful, measurable difference to companies. And according to PwC’s 2016 global CEO survey, 55% of CEOs think that a lack of trust is a threat to their organisation’s growth. But where do you start and how do you avoid ‘karaoke Friday’ and psychological fads?

Paul J Zak has been researching the relationship between trust and economic performance since 2001, both mathematically and behaviourally, and his article for HBR summarises the last ten years of neurological research as well as identifying eight management behaviours that build trust.

 

3. LSE: Performance needs purpos​e

The pay-for-performance practices that dominate the corporate world are built on a foundation of standard economic theory. People act in their own interests, so they’ll work harder if there’s money on the table.

Yeah, right. Just as behavioural economics has shown standard theory to be terrible at predicting human behaviour, there’s little connection between pay for performance and the volumes of academic research on motivation and goal setting…”it’s like we studied human behaviour and flipped the findings on their head.”

James Elfer argues that firms seeking higher performance should look to modern self-determination theory and encourage purposeful work to drive better performance.

4.  EY: How can purpose reveal a path through disruption?

“The human story as it’s unfolding now is a bit of a cliff-hanger,” says Valerie Keller, EY Beacon Institute Global Leader.  “Automotion, digitalization and ongoing economic and political volatility are inspiring a great searching of the corporate soul.  A new idea – and ideal – of successful business in the 21st century is emerging” purposeful business.” 

It is relatively easy for a company to adopt the rhetoric of a feel-good purpose that articulates an aspirational reason for being.  But actually living, breathing and effectively demonstrating a commitment to that purpose is an infinitely larger task.  Yet it is an effort that can pay off substantially in our disrupted world.  

 

5: Huffington Post: Purpose-Driven Business Can Help Rebuild Trust

Ah, trust. That old chestnut. Today, trust in government and other institutions, including business, is at an all-time low. But Paul Polman argues that with the UN Sustainable Development Goals, we have a roadmap for shared purpose, and above all a partnership for the common good. It will take strong leadership and moral courage in order to bring purpose-driven, socially accountable business models from the margins to the mainstream.  If we can, then what better way to restore trust than with purpose? 



How to reverse the productivity slide, end world poverty and reverse climate change. In ten years.

Here’s a shocking fact for employers. Most people who work in our companies hate their jobs. According to Gallup, just 13% of people in the world are actively engaged at work and this has a massive impact on productivity.

And 1 in 5 hate us. 19% of people admit to actively sabotaging their employer.

This is not just a tragic waste of human joy and potential but a shocking loss to our businesses and the economy.

19% of people admit to actively sabotaging their employer

We read constantly about declining productivity in western economies. According to economist Francis Green “the lack of individual discretion at work is the main explanation for the declining productivity and job satisfaction in the UK”.

Gallup estimates lack of engagement at work is costing the US economy $450bn a year. If you factor that globally, that’s $1.7trillion.

Let’s just to put that into perspective for a moment. Let’s pretend we could choose to reinvest that money in solving the world’s problems. We’d eliminate extreme global poverty, end moderate poverty and then go on to reverse climate change all in ten years.  (Ending poverty: $3.5tr Jeffrey Sachs ‘The End of Poverty’. Stabilising greenhouse emissions $13tr, UN Intergovernmental Panel on Climate Change).

So just what is going on? Is this wholesale disengagement from the idea of work truly an existential threat to free market capitalism?

It very well might be. But it’s a problem with a strikingly obvious solution.

Only 40% of people have the first idea what their company even stands for.  Since a fundamental human need is a sense of meaning and belonging, this gives a fairly strong clue to the cause of all that disengagement and anger.

A sense of meaning is a fundamental human need

And there’s evidence to back that up; 62% of millennials want to work for a company that benefits society and 50% would sacrifice salary for meaningful work (Global Tolerance). And 77% of recruits report they joined their employer partly because of the company’s purpose (Deloitte).

The evidence that offering people something to believe in has a huge impact on their happiness and performance is compelling. Staff in purpose-led companies are 12% more productive, 40% more engaged, 70% more satisfied and 300% more likely to stay (Warwick University, Energy Project).

IMD concluded purpose-led companies showed a 17% increased return over 5 years

It’s axiomatic that human performance leads to business performance. And human performance appears to be strongly influenced by what the company believes in. In a review of 56 academic research papers conducted by Deutsche Bank, 89% showed companies with strong Environmental, Social and Governance factors “outperformed competitors on a market basis, while 85% exhibited accounting-based outperformance. And the numbers are arresting. According to Havas, purpose-led brands are worth 20% more than their peers and IMD concluded purpose-led companies showed a 17% increased return over 5 years.

The prize is therefore huge. And the solution sounds incredibly simple. To re-engage with our people, to create fulfilment and wellbeing and to build high-performing companies we just need to rediscover and re-communicate what we stand for.

It’s therefore no coincidence that purpose is now driving so many Board conversations, so much internal comms, and even leaking out into consumer advertising (just take a look at some recent banking commercials).

Regrettably, it’s not that simple. As so many are now discovering, meaningful organisational purpose doesn’t just happen. The bad news is that it requires two things that big corporate companies forgot how to do a long time ago.

The first is ownership (see previous article). Without a sense of emotional ownership it’s hard to engage or find the motivation to strive. Without ownership, why bother? Those who feel ownership care. They also act autonomously to serve the good of the company. In research by Cornell University, businesses that offered autonomy grew at 4x the rate of control-orientated firms, with a third the turnover of staff.

Without trust and ownership, purpose is just a set of words

Yet ownership will only exist in an environment of trust (see previous article). According to academic W Edwards-Deming “Trust is mandatory for optimisation of a system. Without trust, each component will protect its own immediate interests to the detriment of the entire system”. Without trust, why take the risk? High trust cultures are effective and productive because they are open, compassionate and creative not inward, fearful and controlling. Energy is directed to the good of the firm, not the protection of the individual’s position. In research by Paul Zak high trust companies were fully 50% more productive.

The lesson is clear. Before investing in purpose, companies need to take a long, hard look at how they are treating their people. Are they creating cultures of ownership and, most fundamentally, creating environments of genuine trust and true compassion? Without these things, purpose is just a set of words. Devoid of human meaning.

As employers, even if we’re not moved by a sense of our moral duty to make our places of work fulfilling and purposeful, compassionate and meaningful; even if we can live with being hated by 20% of our staff; we should be swayed by the compelling commercial case for purpose. $17tr over 10 years is a pretty good return for doing the right thing.


Love in business. Are you completely crazy?

Love in business? What an absurd, even uncomfortable idea.

But what, after all, is ‘love’? Passion, regard, affection, enjoyment, zest, understanding and compassion? Are these not exactly the attributes we complain are lacking from our businesses?

And the antonyms of ‘love? Resentment, scorn, malice, antagonism, lack of alignment, fear. You don’t need to look far to see these in almost any large organisation in the world.

Perhaps love in business is not such an embarrassment. Far less an irrelevance. But, if so, what does this really mean and how to achieve it?
We thought we’d find out by bringing together leaders from some of the largest companies on the planet with entrepreneurs, advisors, academics and philosophers for an honest debate.

Read the results below.

#PurposeLed

 


Leadership? It’s followship we should be worried about

At a recent HR Conference, attended by HRDs from some of the largest organisations on the planet, there appeared to be only two topics of conversation over the canapes and warm pinot grigio. Leadership and Engagement.

It’s instructive for non HR types to attend these things. HR holds up a mirror to how we, as business leaders, are thinking about our people. And we clearly have some re-thinking to do.

Everyone recognises that employee engagement is the absolute key to higher productivity, efficiency, agility and financial performance. And this is seen as a “Leadership Challenge”. In other words, it’s a top-down issue. The thinking goes, ‘if only we had leaders who could engage, who had better EQ or better communication skills the issue would be solved’.

But what if this isn’t a top-down problem at all? What if it isn’t really an absence of leadership but an absence of followship?

Whilst EQ, compassion and communication are really important skills for the leader, of equal importance are the beliefs, feelings and behaviours of the followers.

And whilst leadership is complex and nuanced, there are only really three key elements to making followship easier.

the best managers figure out how to get great outcome by setting the appropriate context, rather than by trying to control their people” Reed Hastings

Firstly, there needs to be absolute clarity of purpose – shared in such a way that it is relevant and motivating to everyone.  Put simply, why is this thing, whatever it is, needed, and why does this matter to me?  This sounds screamingly obvious but, in most large organisations, clarity of ‘why’ is a rare commodity. Senior management often describe any initiative in ambiguous and often unaligned terms. They rarely communicate purpose. They rarely define context. Yet, to quote Reed Hastings of Netflix “the best managers figure out how to get great outcome by setting the appropriate context, rather than by trying to control their people”.

Clarity and congruence of purpose creates engagement. If messages are muddled or mundane it’s hard to engage as a follower. It’s a big reason that initiatives don’t gain the traction.

Ownership is the source of engagement. It’s actually how most good entrepreneurial businesses do it.

Secondly, ownership must not exclusively rest with the senior team.  Most companies develop initiatives in the senior echelons of the business then launch them on an unsuspecting workforce. There is then a natural pushback. The human reaction is to resist change of any kind. Employees therefore concentrate on why the initiative won’t work. This is a huge waste of time and energy dissipated in negativity and water-cooler dissent.

In order to facilitate a sense of ownership, leaders must instead structure, and allow time for, a process of early involvement from people right down the business before a “launch” is contemplated. Creating a process that is iterative rather than directive creates a sense of ownership. And ownership is the source of engagement. It’s actually how most good entrepreneurial businesses do it.

The value and knowledge in the business sits at the grass roots. And yet we expect all the solutions to come from the top.

So, how many people need to be involved? To achieve absolute buy-in and unstoppable change 15% of people need to feel some degree of ownership through involvement in the creative process. It’s a big change in approach for most large organisations. But the benefits don’t end with the achievement of passionate engagement and adoption of your initiative. You’ll also get a far better solution as pitfalls are ironed out as the initiative develops. As one CEO remarked recently ‘I am always aware that in every meeting I attend I am always the least informed person in the room. And it is the same with all my department heads in their meetings. The value and knowledge in the business sits at the grass roots. And yet we expect all the solutions to come from the top.”

Thirdly, trust is absolutely key to followship. It’s a simple truth that people will not follow where they do not trust or, crucially, feel trusted.

According to neuroeconomist Paul Zak “building a culture of trust is what makes a meaningful difference. Employees in high-trust organizations are more productive, have more energy at work, collaborate better with their colleagues, and stay with their employers longer than people working at low-trust companies. They also suffer less chronic stress and are happier with their lives, and these factors fuel stronger performance”. And he provides plenty of evidence that “people at high-trust companies report: 74% less stress, 106% more energy at work, 50% higher productivity, 13% fewer sick days, 76% more engagement, 29% more satisfaction with their lives, 40% less burnout”.

According to PwC, 55% of CEOs think that a lack of trust is a threat to their organization’s growth.

So, how to build trust in a large and complex organisation? The answer is that eventually everyone in the organisation needs to be involved in developing a new way of behaving. Jeff Weiner at LinkedIn talks about the necessity of a whole organisation learning the skills of compassionate management.

Trust is actually the most contagious of viruses

In a large organisation this sounds terrifyingly onerous. But trust is actually the most contagious of viruses.   Most businesses, like LinkedIn, have found that you start with a discrete and manageable group and through a process of engagement, education and coaching transform their beliefs and behaviours.  With consistency and support, the trust bug spreads and once 15% of people in the organisation are working with compassion the change is unstoppable,

In his book ‘Trust Factor: The Science of Creating High-Performance Companies’. Paul Zak identifies eight factors that build a high trust environment which can be summarised as: offering frequent praise and recognition; setting clear expectations and holding everyone to account on these; allowing maximum autonomy and encouraging self-management; being open with information; demonstrating care and investing in personal and professional growth; and encouraging complete authenticity.

For followship to take root, organisations need to fundamentally rethink their whole top-down, command and control methodology and instead build an organisational culture based on ownership and trust and with a clear and agreed purpose providing clarity ad context.

The simplest and most entertaining representation of how followship works in any human community, and the dramatic and unstoppable impact of getting this right, is best understood by googling ‘shirtless dancing guy’ (do it now if you are not one of the 4,500,000 to have already done so).

The skills of leadership are critical in today’s complex and ambiguous business world. But it is not enough. To create real engagement, agility and velocity right across the organisation it’s time we thought much more about the skills of followship.

If you want to know more about followship and a new approach to business agility you might enjoy this film from TheEthWord. Or do get in touch jrosling@contexis.com @jrosling.