Turn pressure, stress and conflict in business into productivity, innovation and trust

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“The ability to deal with people is as purchasable a commodity as coffee. And I will pay more for that ability than for any other under the sun.”

J D Rockerfeller

 

There’s a simple technique to turn pressure, stress and conflict in business into productivity, innovation and trust.

Here’s some good news. It is perfectly possible to make yourself and your people dramatically more productive. To turn conflict into creation, pressure into progress, breakdown into breakthrough. And make everyone a great deal more joyful in the process.

But first you have to accept a fact that is deeply shocking to most highly educated and skilled executives and professionals.  A fact that it took me about 5 years to digest.

 

What you know has surprisingly little impact on how good you are

The fact is that very little of our commercial success has anything to do with technical knowledge, skills and expertise.  It may suit us to believe that our value to our organisations and our clients lies is in our expertise. But it’s not wholly true. In fact our brilliance may be damaging to our effectiveness. And that could be costing us a lot of money.

Research by the Carnegie Institute of Technology shows that only 15% of financial success is due to technical knowledge. 85% is due personality and our ability to communicate, negotiate, and lead (what they call “human engineering”).

 

Our brilliance may be damaging to our effectiveness

Consider this, Nobel Prize winning Israeli-American psychologist, Daniel Kahneman, found almost everyone would rather do business with a person they like and trust rather than someone they don’t, even if the likeable person is offering a lower quality product or service at a higher price.

 

Could all that investment in skills training be a waste of time and money?

There are broadly three areas of skill in a business: technical, commercial and human. We invest incalculable amounts of time and money in training our people, at school and in business, in technical and commercial skills and almost no time at all in developing their abilities in human engineering. And yet that is what accounts for 85% of our success. Skills training is valuable. But we’re missing a trick if we focus on technical expertise to the exclusion of the human.

And there’s another problem. Even where we do spend time and money on helping our people understand themselves and other people, most of the tools we use actually get in the way of taking any practical action.  We are told that the first step in understanding others is to understand yourself. The problem is that the personality tools we use are so complex that people spend even less time thinking about others because they have so much more complex ‘insight’ into themselves.

The difficulty in applying the tools that are supposed to help in this area result in little change in people’s behaviour. And this is particularly so in the way they are experienced – very often away from, and not directly related to, real business environments. Which means that, when the pressure comes on, any learnings are swiftly overwhelmed and made irrelevant.

 

We’re missing a trick if we focus on technical expertise to the exclusion of the human

After all, when did you last apply the learnings from that latest psychometric analysis when the proverbial hits the fan and you and your team are up against crisis, pressure and the clock?

Surely, the key to true dynamic skills is the ability to apply techniques in real time and under pressure.

 

People’s response to pressure is key to understanding how to improve human dynamic skills

That is, after all, what happens in elite sport.  This is how the ‘process of coaching’ works. Firstly, you help a person learn a new technique, then you put them under pressure and see if they can still execute the technique. Then it is called a skill. In a game, if they can execute this skill for the benefit of another team member then they are called a player.

In business we give people lots of techniques but most of those techniques are lost when pressure is applied. No execution. No real players. 15% of the potential value.

The learning is that people’s response to pressure is key in understanding how to improve human dynamic skills, reduce friction and increase productivity. This may sounds like a whole new layer of complexity, on top of ‘personality types’ etc.  But it isn’t. And nor is it new.

J D Rockerfeller said ‘the ability to deal with people is as purchasable a commodity as coffee. And I will pay more for that ability than for any other under the sun’. Perhaps he knew instinctively what the Carnegie Institute of Technology proved many years later.

 

Our response to pressure is predictable. And that unlocks the puzzle.

And we have an ally. Our own psychoanatomy. People’s response to pressure is entirely predictable. And that means there’s no requirement to learn complex psychometric types which are hard to remember and apply. Some simple tools can be applied in the moment, in real times of business stress, to understand and engage with others under pressure. And that really is understanding human engineering.

Modern neuroscience has shown how our brain has developed over time. Most interestingly, how the neocortex (thinking and language brain) has developed.  But there’s one area of our brain that has seen no upgrade in millennia. And that’s the amygdala. The purpose and the functionality of this part of our brain has not changed. It is functionality we share with all our evolutionary antecedents.  And that function is to protect. It kicks into action when there is a threat. When we are under pressure.

New research applies this neuroscience to find out what happens when a person is under stress or pressure in real business environments. Using this, the researchers can codify and predict how people will react. This is rather hard to do in the theoretical ‘observational’ approach of most organisational modelling from Jung onwards.

 

Of tigers and tight deadlines – the unthinking tyrant within

So, what does the amygdala do when we are under pressure?  Firstly, our brain receives a shot of adrenaline to help us respond quickly. It also receives a shot of dopamine to reduce inhibitions that might prevent action. Then the neo-cortex receives a shot of serotonin, basically to help it calm down and thus stop you thinking too much which can be debilitatingly slow. It’s sometimes referred to as ‘the amygdala hijack’.

 

Our amygdala simply doesn’t distinguish between a real threat and a perceived threat

All of this is fantastic when you’re being chased by a sabre-toothed tiger. But not so good at work when we are dealing with complex pressures – and, most critically, other people. Because what the neural research suggests is that the amygdala simply doesn’t distinguish between a real threat and a perceived threat. Our response to stress, at a physiological level, is the same.

We may be the only species that does not suffer from daily threats to our existence. But instead we have invented the game of business. And in that game an amygdala response can be triggered by anything that is a threat to our reputation or our identity. This perceived threat results in exactly the same neurological drug-fest that occurred when the tiger was getting closer. And unlike in our evolution, when amygdala hijack was an infrequent occurrence, today, in the office, it is happening on a daily basis. And that creates unprecedented stress, friction and dramatically decreases productivity.

 

Conflict as a spark to leap forward not dig in and stop

So, if there is a neurological cause, is there a neurological answer? The answer is yes. There are four survival strategies triggered in response to an amygdala hijack.  These are biological responses and hard coded into our DNA. They are therefore entirely predictable.

When under pressure, some people have a need for certainty and so take charge and tend to dictate. They can come across as arrogant and perhaps uncaring. They love ideas.

Some have a need for a sense of freedom. They need to feel they are not boxed in. They can often come across as impatient and restless. They love relationships.

Under pressure a third group have a need for stability, get their heads down, tolerate things and plough on. They love getting things done.

And finally, there’s the group that have a need for security and tend to hibernate in their office. They do not like to make decisions but do they love getting things right.

Since a person’s response to pressure is relatively consistent and therefore predictable, how to deal with that person is equally predictable. There are simple things can be done differently for each style.

 

“With only 15 minutes of planning, we got a whole new approach to a Group Board member that we had struggled with for two years.”

In every office environment there is conflict, and that conflict is made worse under pressure. Breakdown between individuals and within teams is common. It’s both incredibly damaging to productivity and  not great for mental health. Either way it costs a lot of money.

Yet, now we understand the neuroscience behind the problem, there is a simple solution to breakdown. A clear set of strategies people can learn to apply to unblock relationships, build trust and unleash the power of collaboration. These strategies take less than a day to learn and can be applied to real situations immediately.

Find out more about how Agile Styles can be applied in your own business here.

 

“Of all the courses in our core curriculum, this has shown the highest correlation with accelerated revenue growth and improved performance. Individuals and teams in every service line have dramatically transformed their results with these tools.”

Katherine Steen, Colliers University Global Director

 

You might also enjoy these articles:

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

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

Leadership? It’s followship we should be worried about

 

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 NeONBRAND on Unsplash


‘Most big companies won’t have the velocity to see out the decade’. Survival tips from the ones wearing the running shoes.

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90% of CEOs don’t believe their business is moving fast enough to adapt to the changing world.  And that raises a mass of questions. How do I create an agile, high performance culture? How do I engage and align our people?  How do I drive productivity? Land strategy? Create trust in our business?

There’s an old story about two hikers who are confronted by a large bear in the woods. One calmly sits down, removes his boots and puts on a pair of running shoes. “What are you doing!” his panicked friend asks, “you’ll never outrun a bear.” “I don’t have to” he replies” I only have to outrun you”.

 

The life expectancy of a S&P 500 company is down to 15 years!

Whilst CEOs may be right that their business is not moving fast enough, it may not be as bad as they fear. In most cases they only need to go faster than the other guy.  It’s therefore worth asking who is wearing the running shoes in your industry. Which are the agile businesses you face, and what are they doing that you are not?

The answer tends to be the businesses that are smaller, newer, less encumbered with legacy; in other words, the entrepreneurial ones.

 

Entrepreneurial thinking; a mindset not a legal entity

Yet, entrepreneurial thinking actually has very little to do with scale or age. It’s a mindset. It’s therefore worth taking a really close look at what entrepreneurially-minded businesses, of whatever size, actually do. How is that they create that agility of culture, productivity of people and performance of management. And can this be replicated?

 

Entrepreneurial thinking actually has very little to do with scale or age

A big part of what drives agile business is a compelling and engaging purpose which is authentically and consistently held in the organisation.  For purpose to have any impact, it must not only be credible and congruent to the activities of the business. It must also be absolutely authentic. Most large organisations know this and have spent a great deal of time, trouble and money creating and communicating a clear purpose. They believe it’s the key to driving the agility in their people, their leadership and their cultures that they need to survive in the fast-paced and ambiguous world they face. They believe that a clear purpose will engender behaviours of alignment and engagement in their people, clarity and velocity in their management, and openness and creativity in their cultures. These are the hallmarks of the agile, entrepreneurial business they seek to create.

 

For purpose to have any impact, it must be credible and congruent to the activities of the business. It must also be absolutely authentic.

And most are finding it’s making not a jot of difference to the behaviours in the organisation; “we’re just not getting any traction from our purpose” as one C-Suite said to me recently. There is a big gap between the purpose at Board level and the experience of employees and customers. Just why is this?

 

Entrepreneurially-minded organisations achieve agility not by having a purpose but what they do with it.

Agile, entrepreneurial businesses just use purpose in an entirely different way. A way we find can be replicated in almost any organisation to bridge the gap and actually harness all the power of legacy (that currently burns itself up in internal nonsense) and point it outwards to create velocity for the company.

Our experience of these agile and entrepreneurially-minded businesses reveals a clearly defined set of drivers within their cultures that are the secret to bridging the Purpose Gap.

Inspiring leadership helps.  Purpose should be inspiringly and credibly led.  But what the business believes about itself and how it behaves are more important.

The first major difference in these organisations is a strong cultural assumption of TRUST. These cultures tend to be open, compassionate and creative rather than inward looking, fearful and controlling. In more traditional cultures based on control, people are instinctively distrustful of the purpose and hence it has no power to change things for the better.

 

What drives trust is a marked difference in the organisation’s approach to people.

What drives trust, allows purpose to thrive and transforms cultures is the organisation’s approach to people.  There is no mystery to this; as Jeff Weiner of LinkedIn says, it can be taught. There is also nothing soft or altruistic about it; creating trust is a major driver of exceptional productivity and efficiency.  And, as LinkedIn has discovered, the rewards of creating Cultural Agility in terms of building cultures that are innovative, open and always learning can be extraordinary. To find out more about creating agility through building a trust culture read here.

 

There is nothing soft or altruistic about creating trust; is a major driver of productivity.

The second major driver of entrepreneurially-minded businesses is a company-wide feeling of, and desire for, OWNERSHIP.  Unless everyone in the organisation feels – and feels allowed to feel – a powerful sense of ownership of the business it will not flow through into agile employee behaviours. Organisations in which everyone feels an emotional investment demonstrate employee behaviours of alignment, engagement and autonomy. And the simplest and most compelling route to creating a culture of ownership is to create a feeling of ownership of the purpose the organisation serves.

 

Organisations need to reframe the relationship between the company and the employees from one of control to one of self responsibility

This is about a critical shift in how management at every level of the organisation thinks and behaves and about shifting the relationship between the company and the employees from control to self responsibility.  To find out more about creating agility through developing ownership and responsibility read here.

The final driver of entrepreneurially-minded businesses is the ability to manage in CONTEXT.  Whilst trust drives cultural agility, and ownership drives engagement and autonomy, the ability to manage in context defines how effectively and efficiently management behaves.

 

Contextual Management creates clarity, adaptability and, above all, velocity in management decision-making.

An increasingly volatile, uncertain, complex and ambiguous world requires a significant amount of adaptability; and that is something that entrepreneurial management is all too familiar with. Whether because of the speed of development, newness of the market or paucity of resources, entrepreneurial management has long been adept at navigating an ambiguous world.  The key skill entrepreneurial management demonstrates is the ability to make decisions contextually to create clarity and direction rather than getting bogged down in the content. And this is a skill that can be taught.

Where management uses a clearly articulated purpose as the context for key decisions, within an environment of trust and where the whole team is willing to take responsibility, it creates enormous velocity. It also ensures the purpose links the business up from top to bottom.  To find out more about creating agility through managing in context read here.

 

Is there any proof to support these observations?

Actually, yes. So convinced are we that purpose drives performance we wanted to prove it. So, we’ve spent two years creating a measurement methodology with Cambridge University and others that provides the metrics to definitively prove that purpose drives performance. But that’s not enough. We also need to show how this effect works and measure the correlations and causalities between the cultural attributes described above. We need to show how these cultural factors activate and unlock purpose. So that any company can replicate the cultural systems of the best entrepreneurial businesses and start to develop a more dynamic and agile culture. You can find out more about that work, and how you can benefit from it today, here.

It’s easy to agree that purpose is a good thing.  With the life expectancy of a S&P 500 company down to 15 years, it’s easy to identify that the behaviours of aligned engaged staff, open innovative cultures and agile clear-headed management are the key to survival.  The problem is the gap between purpose and behaviour. Without the entrepreneurial drivers of trust, ownership and context muddle, distrust and cynicism will persevere in middle management and purpose will not take root. Without these entrepreneurial ways of thinking no business can hope to be agile. It will always be outrun.  And in a volatile, uncertain, complex and ambiguous world the bear is very large and very real.

 

You might also enjoy these articles:

How thinking like an entrepreneur could make corporate organisations 26% more productive

Purpose transforms performance. But if you can’t measure it how can you implement it?

How one of the world’s largest financial institutions got more than it bargained for in implementing purpose

 

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.


‘90% of corporate strategies fail’. Not if you think like an entrepreneur

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How can you get people aligned round your strategy? How can you speed up strategic implementation?

61% of C-Suite acknowledge that they fail between strategy formulation and its day-to-day implementation. We can learn a lot from entrepreneurial business. And it’s not hard to replicate their play-book.

In his 2015 book Thirteeners Daniel Prosser claims that 87% of businesses fail to execute or implement 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.

 

It’s not the formulation of strategy that’s at fault. It’s the inability to execute.

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.  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.

 

How can we bridge the gap between strategy and implementation?

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, I 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

 

First, understand the ‘Why?’

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.

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’.

 

Build a culture of trust

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. It 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).

 

Communicate to inspire

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….

 

 

If you enjoyed this article you may enjoy these too:

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

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

How one word helped an ambitious new CEO reinvent his strategy, transform his team and set his business on a path to a €1bn target

 

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 Steven Lelham on Unsplash


Purpose transforms performance. But if you can’t measure it how can you implement it?

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How do you know if purpose is working effectively in your culture.  And if it isn’t, why not?

Here’s a promise; purpose can transform your organisation’s performance.  If you get purpose right you can expect to see a gain of at least 30% in engagement, 29% in joy and 26% in productivity, based on your median employee.

It’s a claim we can make based on the impact of purpose on human and business performance in a whole range of companies.  And we’ve seen the same results in companies from global multinationals to fintech entrepreneurs.

Purpose is at the heart of all the best agile, entrepreneurial businesses.  But that is only half the story.

It’s accepted that purpose-led companies are more attractive and empowering places to work.  It’s increasingly claimed that purposeful companies also out-perform their profit-driven peers. But, if so, why?

We’ve always been fascinated with what drives human performance and productive cultures in organisations.  Specifically, in the differences between agile, entrepreneurial businesses and scaled, legacy corporate ones. We have spent years observing and codifying the differences between the entrepreneurial and corporate businesses we work with.  In doing so, we have identified a whole basket of behavioural differences. Fundamentally, they come down to one word – ‘purpose’.  But not in the way you may think.  It’s  not about having a purpose.  But what you do with it.

Yes, the best agile, entrepreneurial businesses are obsessively clear about why they do what they do.  But that’s not the whole story.  They also exhibit a set of specific cultural attributes that activate purpose to drive startling levels of human motivation and performance.  And exactly those same cultural attributes are largely suppressed in most scaled businesses – stunted by time, complexity and legacy.

The cultural attributes that enhance both human meaning and business performance

Developing this model of purpose activation got us wondering.  Is it possible then to measure purpose?  Is is possible to create robust metrics of purpose impact, and could that model show exactly how purpose works to improve performance? If so, could it enable any organisation to emulate the best agile organisational cultures? By adopting the right mix of cultural attributes can any business activate purpose to enhance both human meaning and business performance?

To find out, we teamed up with leading academics and researchers led by Cambridge University and Plymouth University.  Together, we spent two years building just such a measurement process. This is based on assembling, for the first time, world-leading academic scales of performance measurement into one model. The model measures the key human performance factors known to support sustained organisational performance. It then seeks to understand the causality of these by linking each back to purpose through the assessment of a defined set of cultural characteristics.  In this way, the model both measures the impact of purpose and demonstrates how it is working in the organisation.

The model measures the key human performance factors which impact performance and demonstrates how it is working

The Index gathers data from a representative sample of employees via an on-line survey or app.  This is not a subjective, external view of purpose, nor is it based on proxy measures.  It provides a clear metric of purpose performance that can be bench-marked internally, over time and against peer comparitors.  It represents an uncompromisingly accurate view of how purpose is working and where it is blocked in the real business, in real time.  Results are provided by demographics (age, sex, seniority, location etc) via an interactive dashboard and in a detailed report with specific analysis and recommendations.

It’s not purpose but activation that matters

So, what does the model reveal?

Firstly, can you measure purpose?  The answer is absolutely yes.

And can you measure the impact that purpose has on the performance of real businesses in real time, using robust numbers that can be bench-marked over time and between businesses and sectors?  Again, the answer is yes.

It is clear that an activated purpose galvanises specific human behaviours, and it is these behaviours that drive commercial performance. The key question is what characteristics in the organisational culture activates purpose to allow for these performance gains – and what is missing when purpose is suppressed.

One factor dwarfs all others – whether someone considers their employer to be purposeful

There are multiple factors that determine employee performance.  But one factor dwarfs all others.  Those employees who consider their employer to be purposeful score between 25% and 100% more positively than the median employee across a broad range of performance attributes. This includes, of course, engagement but also autonomy, openness, clarity or strategy, velocity, joy and many others.  The are also 30-50% less likely to quit.  And the key cultural factor that activates purpose to achieve these performance gains appears to be the presence of emotional ownership and an assumption of trust.

What this means for you

What this means is that the simple act of engaging all staff with a clear and inspiring purpose will indicatively lead to performance gains of 25%, and in extreme cases 100%, and a reduction of staff turnover by at least 30%.

It shows, for the first time, that the key activator of this effect is not a statement of purpose but may be the creation of a culture of trust and emotional ownership.

And it allows you to identify accurately, and with extraordinary detail, specific communities where the impact of purpose is blocked.  It then allows you to track the impact of interventions or communication on these individuals and and to adapt these in real time to maxmise the effect with real efficiency.

What do the companies who have take the Index so far  have to say?

All the companies who have taken the Index so far have revealed startling new insights into how and where purpose is working and where its effect blocked.

“This has fundamentally changed how we think about our people and their motivation.  The clarity it’s brought  has been extraordinary.” FTSE PharmHealthcare

It has also enabled them to design highly targetted interventions with a great deal of confidence, since they are based on reliable empirical data, and ‘pulse’ survey all or specific groups in the business to assess their impact in real time.

“Without Purpose, a company can only flipflop around without truly consolidated, effective effort.  What Contexis has developed 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 us!” Fintech challenger

By undertaking this analysis you will develop remarkable insights into how purpose is working in your organisation and where it is not.  You will also be joining companies around the world in supporting important research into how purpose drives commercial performance by contributing wholly anonymised data 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 this important research please get in touch.

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

You may also enjoy these articles:

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

The Neuroscience of Trust

How one of the world’s largest financial institutions got more than it bargained for in implementing purpose

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.


Purpose: If you can’t measure it, what’s the incentive to change?

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Our ambition is to measure the commercial impact of Purpose and show specifically how Purpose is acting to change human behaviours and drive business performance.

It’s widely accepted that Purpose-led companies are more attractive and empowering places to work. But can it be indisputably and empirically proved that ethical businesses also commercially outperform their profit-led peers? Is a robust measure of Purpose Efficacy possible?

Can it be indisputably and empirically proved that ethical businesses also commercially outperform their profit-led peers?

A clear set of purpose metrics

If it is, it could have a significant impact on promoting a better way to do business globally. It would enable organisations of all sizes to embed Purpose and ethics into their strategy, confident of the long-term benefits to commercial performance and value creation, based on a clear set of metrics and an understanding of exactly how Purpose can drive performance in their specific organisation. The Contexis Index® solves the measurement problem for the first time, providing credible metrics based on the latest academic thinking on the impact of Purpose on human performance in businesses today and showing how this is working so that you can activate Purpose right across the business to enhance staff and societal wellbeing whilst also supporting long-term value creation.

The Index is the result of research into high performing businesses by Contexis and researchers at the Universities of Cambridge and Plymouth.

The Index is the result of research into high performing businesses by Contexis and researchers at the Universities of Cambridge and Plymouth. It employs rigorous measurement scales to assess a broad range of organisational performance metrics and links these back to Purpose through a defined set of cultural characteristics. This provides, for the first time, a comprehensive analysis of where the gaps exist between Purpose and organisational performance. 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 an on-line Survey or smartphone App. Results are  provided in a detailed Report with data presented graphically together with detailed analysis and recommendations.

Are you clear as to how purpose is really working in your organisation?

Running the Index through your business will give you a clear understanding of how Purpose is working in your own organisation and where its effect is blocked. It will also enable you to design highly targeted interventions with a great deal of confidence since they are based on reliable empirical data and ‘pulse’ survey all or specific groups in the business to assess their impact in real time.

And in gaining this insight you are also contributing to important global research.

Running the Index through your business will give you a clear understanding of how Purpose is working in your own organisation and where its effect is blocked

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 be joining companies around the world in supporting important research into how ethics drives commercial performance by contributing wholly anonymised date to the University of Cambridge. You will also develop remarkable insights into how purpose is working in your organisation and where it is not.

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 get in touch.

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 Smart on Unsplash


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

Reading Time: 4 minutes

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 Trust

Reading Time: 2 minutes

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

Reading Time: 2 minutes

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.

Reading Time: 3 minutes

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.


Leadership? It’s followship we should be worried about

Reading Time: 4 minutes

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.


WE BELIEVE

that when purpose drives strategy in an environment of trust, it creates passionately engaged people, innovative cultures and clear and high-velocity management. We call this entrepreneurial thinking. And it leads to unstoppable change.

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