Making Money isn’t Your Company’s Purpose. So, What is?
I want you ask yourself: Why do I do what I do? Besides making money — which is really not a purpose but rather an outcome of doing business —why does your company exist? That’s the million-dollar question every business, not just Fortune 500-level companies, should be asking themselves and their employees.
Today, money isn’t enough to keep a business alive in the long-term. Purpose is the glue that holds an organization together through thick and thin — from the products you sell to the people you hire to lead your teams. Every decision you make as an organization must align with your overall greater purpose. Finding your purpose, however, is easier said than done. After all, it’s the very essence behind your company’s very existence.
In this blog post, I continue my series on the experience of Hubert Joly, the former CEO of Best Buy, and his new book, The Heart of Business: Leadership Principles for the Next Era of Capitalism. I believe this is the most important book so far written this year about getting to the true heart of what business is. So much so, that I want to share with you the top 5 takeaways I found most valuable for finding your true purpose — even if you think you already have one.
Quit Leading with Your ‘What’ and Focus on Your ‘Why’
After Joly successfully turned around Best Buy, he paused and asked his leadership team 1) how do we accelerate growth and 2) what kind of company do we want to become? During this time, Joly’s team watched Simon Sinek’s blockbuster Ted Talk, How great leaders inspire action — a video I also use with my clients to help them identify their purpose.
Oftentimes, companies tend to start with their what — their products or services — and figure out later how those goods and services ladder up to why their company does what it does. For example, Best Buy is a retailer of consumer tech, but that’s not their purpose for being a business — that’s their what. There’s lots of retailers out there that offers the same or better consumer tech. So, what does Best Buy have to offer that their competitors don’t? A purpose.
Sinek argues that a business’s value proposition does not lie within the product (the what) but rather the why — the core purpose of existing. That’s then when the Best Buy team realized they weren’t actually a retailer at heart. Yes, they sold consumer technology goods like laptops, computers and appliances, but those are all what they sell — not why they sell it. There lied a deeper element behind their business.
Find the Common Human Elements Among Your Team
There’s more to life than simply making money — and that’s what your team must drill down to find. For Joly and his team, this is where he led his team next to find their real purpose for being. Two things became apparent:
They’re actually human beings, not just executives
All of them were driven by the desire to do something good in the world
It was then they realized that Best Buy wasn’t simply a business that sells computers and appliances. Rather, Best Buy is a platform for which they can achieve their desire to do something good in the world, human to human. While this may not seem big at first, it’s cataclysmic. This represents a huge shift in the mindset of the Best Buy culture.
Today, Best Buy’s focus isn’t on selling computers. Best Buy is in the business of enriching lives through technology by addressing key human needs. Not only did this tie back to their individual desire as human beings to leave the world better than they found it, but it also vastly extended the markets Best Buy could enrich and reach.
Sinek explains this through his Golden Circle concept (below):
- Every company should know what they do.
- Some companies know how they do it. These are factors that set an organization apart from competitors.
- Few companies know why they do it. Money is not a why.
Ask Yourself: Are You Living Your Company’s Values?
Values are fundamental beliefs that shape our attitudes and actions. Every business I know of has written values, but few businesses actually place any value in them other than a dedicated section on their websites.
For Joly, values were more than just words on a website — they’re the bedrock of a company’s culture and set the tone for subsequent relations with not just your coworkers, but also customers. Per Joly:
I know we say it is ‘customer first.’ We are always customer centric. But for the public companies are those that have covenants, when it comes to times of missing guidance, are we cutting corners on the customers? We evaluate people based on performance and leadership behavior. Jack was a top, top performer but he’s a jerk. We probably know a few of these. How long do we keep him on the payroll? That defines the values. If we keep Jack on the payroll because he is such a good performer — we know he is a jerk, but we have to keep him, we need him — you have just written off your values. The values created an environment where we could have candid conversations, and that evolved at Best Buy.
Values are more than a marketing necessity — they’re a temperature check for the health of your company’s culture. For more information on company culture, check out my three-part series on how to create a culture that elevates your company and employees.
- Part 1: Why culture is important
- Part 2: How to plan the company culture you want
- Part 3: How to execute and maintain a culture
Be Prepared for Your Values and Culture to Get Tested
It’s a fact that there will be times — if not every day — that your company’s values get tested, whether that’s a dispute between colleagues or a significant crisis that your business’s success hinges upon. The latter was the case of Joly, when two weeks from Black Friday, the FBI calls with news of a possible data breach — potentially catastrophic news, especially when BestBuy is already undergoing a turnaround of its business.
In one of the most important stories in the book in my opinion, Joly tells us how he handled it:
I still have this image of the room where we gathered. It was a windowless conference room. Opening the meeting, I could have decided to be very depressed. I could have decided to look for who forgot to close the back door. Who is the culprit? Or anything like this. Or potentially impress everybody on how smart I was in crisis management. I did none of the above. The way I showed up was to say literally this: “Look, nobody would dream, certainly at Best Buy, of having a data breach two weeks before Black Friday. That’s not good. Let’s agree with that. Having said that, I couldn’t be more excited (and that was genuine) about the opportunity to work with every one of you on how are we going to go through this. I’m not the product of my circumstances. I’m the product of my decisions. I have trust in this team. I know we are going to do very important work. I’m going to try to be the best version of myself. I look forward to supporting this team so that we get to the best possible outcome. Because I know that the way we lead is going to have a huge impact on how we come out of this.
Luckily, it turned out to be a false alarm. However, I love the way Joly handled the situation. This is the definition of living out your values.
Know What Type of Tone You are Setting for Your Organization
In the final minutes of his speech, Joly shares his experience of breaking the news to investors that the 2013 holiday season missed the mark. He knew that the market would not like the news. This is what he told his officers the day before the announcement:
We have a choice tomorrow. We can either tell the world we are surrendering (everybody who thought we were going to die was right) or we can ask ourselves “why do we fall, Bruce”. Of course, that is from a Batman movie, and the answer is so that we can learn to pick ourselves up. The other movie is Any Given Sunday. An amazing movie with this scene in the movie with Al Pacino at half time where he speaks to his team. I recommend it to everybody. This is the best motivational speech ever written and delivered. So, what we decided is we missed. We made a few mistakes, myself included. We are going to look at these mistakes and we are going to learn from them and get back on the saddle. That is what we told the investors the next day. We didn’t hide. We didn’t blame. Sometimes you see retailers blaming it on the weather. We blame it on ourselves and say we are going to be back on the saddle and correct it. We went back to $26 and now it is $110.
I especially like Joly’s takeaway from this experience. He says leaders are not thermometers; they’re thermostats. As a leader, you’re going to encounter hardships and hurdles. There’s simply no way around it. In these situations, leaders cannot passively sit by and hope for the best. One of the biggest roles as a leader is the ability to set the tone of an organization — you have the power to influence how your team and other stakeholders see things. Use that power wisely, and set a tone that motivates your team and encourages them to act.
If you’re interested finding your purpose or taking a second look at the one you already have, contact me for a free initial consultation. Your why matters, and I can help you find yours.
Stay tuned for my final thoughts on Joly and his new book, The Heart of Business: Leadership Principles for the Next Era of Capitalism. I believe it’s one of the most important books this year on leadership as we enter a new era of business.