„The pursuit of efficiency was once a laudable goal, but being effective in today’s world is less a question of optimising for a known (and relatively stable) set of variables than responsiveness to a constantly shifting environment. Adaptability, not efficiency, must become our central competency” Stanley McChrystal (Former US General and Advisor)
Observing business leaders (and even more so politicians!) struggle with current world conditions, I have recently been thinking about the enablers of success in the increasingly volatile, uncertain, complex, and ambiguous world – the critical elements of a „corporate operating system“ that will ensure and safeguard resilience and favorable outcomes.
One thing seems evident to me in the context: we generally need to become more agile (note the small caps!) and responsive. But what will get us there?
A Corporate Operating System
At this point, I am pondering the following half-dozen elements that I believe to be essential:
- Purpose – Know your WHY!
- Strategy – Consciously choose WHAT to do!
- 1st Principles Thinking – Resist proxies and processes!
- Objectives and Key Results (OKRs) – Stay focused and track outcomes!
- Evidence-Based Decision Making – Observe and orient!
- Leadership – Go beyond managing!
Another candidate I am considering is „Systems Thinking – Mind the impact!“
This is my current list. I’d love to hear your opinions!
Putting the thoughts behind the list in one Weekend Reading would have ended #TLDR, so I will break them down over the next few weeks, starting with
Many, if not most organizations I work with have difficulty rationalizing and communicating why they exist, whether on a company or department level. Having been around for ages, they seem content with optimizing what they have been doing seemingly forever. As Simon Sinek’s seminal TED talk „Start with Why“ shows, nothing new. But in an increasingly VUCA world, this may not be enough to develop a coherent strategy that enables successful prioritization and choice, let alone keep or attract motivated employees.
Clarity about purpose enables bold moves. McKinsey research shows that companies that act boldly are more successful.
Business leaders‘ beliefs support this: „79% of business leaders surveyed by PwC believe that an organization’s purpose is central to business success, yet 68% shared that purpose is not used as a guidepost in leadership decision-making processes within their organization.“ as Forbes quotes PwC findings.
According to the same PwC study, millennials who have a solid connection to their organization’s purpose are 5.3 times more likely to stay.
Purpose defines the benefit an organization creates for someone (-else, usually customers) or society as a whole. If an organization is not clear about why it is pursuing a particular goal, it will be limited in its strategic approach.
A purpose is a prerequisite for a broader definition of the organization’s playing field and allows for more options in developing a strategy.
An organization’s purpose transcends defining a future state (Vision) or route to reaching it (Mission); it focuses and spells out the WHY of an organization.
Focus on purpose may seem to conflict with business focus, yet I believe the contrary is true.
Ben and Jerry’s (-ice cream; for those of you who have not had teenage daughters) are, to me, the epitome of a purpose-driven company:
„To make, distribute and sell the finest quality all-natural ice cream and euphoric concoctions with a continued commitment to incorporating wholesome, natural ingredients and promoting business practices that respect the Earth and the Environment.„
This reads pretty hippiesque but did not preclude the founders from selling the company to Unilever while keeping it on a sustainable financial basis of profitable growth and increasing value for stakeholders and society as a whole.
A genuine purpose strengthens brand identity, which usually increases consumer loyalty.
According to former „Best Buy“ CEO and HBR author Hubert Joly, finding purpose requires considering four questions
- What does the world need?
- What are people at the company passionate about?
- What is the company uniquely good at?
- How can the company create economic value?
and distilling a distinctive proposition from the overlap of the answers.
If you want to dig deeper, here are some reading suggestions for the weekend:
Creating a Meaningful Corporate Purpose
Hubert Joly presents five considerations critical for defining a powerful corporate purpose.
Steve Jobs and the Purpose of the Corporation
Ben Heineman on why Steve Jobs’career and company saysomething profound about the purpose of a corporation.
Enjoy the – here in the South wonderful – fall weekend!
All the best,