This month’s print edition of HBR makes mention of a new study supporting ‘the purpose-profit’ connection (p32). The study looks at the relationship between strong purpose and public company financial performance. I believe the insights apply to all organizations – That is, any organization with a strong purpose will see increased performance.
The study finds there is a strong link between PURPOSE and PERFORMANCE (or, in my adjusted language, IMPACT). Researchers make a distinction in two types of high purpose organizations. The first is what it calls ‘high camaraderie’ where everyone simply has a sense that they are doing something great, TOGETHER. The second type of purpose is ‘high clarity’ from management. This is noted as the type where managers excel at translating purpose into action.
The statistically significant performance bump was only found with organizations that have ‘purpose clarity.’
As a leader, think not just about PURPOSE, but ‘PURPOSE CLARITY.’ To help you with this, I would bridge some of the findings of the research with some of the For Impact teaching. Think about PURPOSE as an anchor for your STORY. And, by story, I don’t mean a narrative with a beginning-middle-end. I mean how you FRAME the organization.
A GREAT STORY…
- Is anchored in hope-filled purpose (Start with WHY!)
- Simplifies WHAT you do.
- Serves as a litmus for action.
Some of the writing in the research study further supports thinking about placing PURPOSE inside of STORY. “The company’s primary purpose – the real one, which isn’t necessarily the one written in the official documents or etched in the wall plaques – [that] guides its actions and decisions.”
Gartenberg, Claudine Madras and Prat, Andrea and Serafeim, George, Corporate Purpose and Financial Performance (June 30, 2016). Columbia Business School Research Paper No. 16-69. Available at SSRN: https://ssrn.com/abstract=2840005
Here’s a topic that comes up often with some of our coaching clients – Especially when there is lack of role clarity around maximizing relationships!
A NATURAL PARTNER (N.P.) is a person (either inside or outside of your organization) who has a strong relationship with your organization and an existing relationship with the Qualified Prospect(Q.P.) – Or a reason to believe one can be established quickly!
Externally, Natural Partners can be on your Board, they can have a business relationship with the prospect, they can be members of the same club or organization or they can be fellow community leaders, etc.
Internally, the Natural Partner can be anyone from the President/Executive Director to top senior leadership, to a staff/programming person who has a great relationship with the prospect.
It’s important that you determine the difference between a RELATIONSHIP MANAGER (R.M.) and a NATURAL PARTNER.
The RELATIONSHIP MANAGER does not necessarily have to have an existing relationship with the prospect. Their job is to do exactly what it says – MANAGE THE RELATIONSHIP. The Relationship Manager is always a member of the ‘Green Team’ – I.e., directly responsible for maximizing relationships on behalf of the organization/impact. It is perfectly fine for multiple people within the organization to have a relationship with a Q.P. – as long as the Relationship Manager has been defined.
The NATURAL PARTNER can have an existing relationship, or the ability to create one immediately, but most importantly, they play and instrumental role in Team Selling. They can:
- Help get the visit! Opening doors is one of the most productive things N.P. can do!
- Predispose the Prospect to a great visit! A N.P. can send a great note ahead of the visit – “I know you’re meeting with Sharon on Friday – I’m so excited for the two of you to meet, for you to hear about the vision and getting more involved in our impact! I’ll check in with you after”
- Follow Up! A call from the Natural Partner (after a check in with the R.M.) can be hugely beneficial. “How did it go? What did you think? What can I do to help?”
Your organization’s story is about MORE than a mission statement, strategy, and clear goals – it’s about the CONTEXT that creates meaning.
In all my reading I’ve not been able to find (or compile) anything as strong and complete as what is expressed by Ben Horowitz, the cofounder of Andreessen Horowitz, a Silicon Valley venture capital firm with investments in Facebook, Twitter and Airbnb. I’m sharing a full excerpt from his book The Hard Thing About Hard Things.
Bold emphasis is mine. Translate all of this to our ‘Impact world’.
The CEO must set the context within which every employee operates. The context gives meaning to the specific work that people do, aligns interests, enables decision making, and provides motivation. Well-structured goals and objectives contribute to the context, but they do not provide the whole story. More to the point, they are not the story. The story of the company goes beyond quarterly or annual goals and gets to the hard-core question of why. Why should I join this company? Why should I be excited to work here? Why should I buy its product? Why should I invest in the company? Why is the world better off as a result of this company’s existence? When a company clearly articulates its story, the context for everyone— employees, partners, customers, investors, and the press— becomes clear. When a company fails to tell its story, you hear phrases like
- These reporters don’t get it.
- Who is responsible for the strategy in this company?
- We have great technology, but need marketing help.
The CEO doesn’t have to be the creator of the vision. Nor does she have to be the creator of the story. But she must be the keeper of the vision and the story. As such, the CEO ensures that the company story is clear and compelling.
The story is not the mission statement; the story does not have to be succinct. It is the story. Companies can take as long as they need to tell it, but they must tell it and it must be compelling. A company without a story is usually a company without a strategy.
Want to see a great company story? Read Jeff Bezos’s three-page letter he wrote to shareholders in 1997. In telling Amazon’s story in this extended form— not as a mission statement, not as a tagline— Jeff got all the people who mattered on the same page as to what Amazon was about.
Horowitz, Ben (2014-03-04). The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers (p. 237). HarperCollins.
I LOVE this framing. And, I can’t post without a coaching point for sales people (fundraisers). We, as fundraisers, must do everything we can to help CREATE, SUPPORT and OWN the story. It’s too easy to say, “Leadership doesn’t get it.” In my estimation 90% of companies and nonprofits don’t really understand the power of STORY as something that SHAPES meaning, strategy and impact.
Here is a story about LEADERSHIP (as shared in the Encore Effect).
From Herb Kelleher, founder of Southwest Airlines.
“My best lesson in leadership came during my early days as a trial lawyer. Wanting to learn from the best, I went to see two of the most renowned litigators in San Antonio try cases. One sat there and never objected to anything, was very gentle with witnesses, and established a rapport with the jury. The other was an aggressive, thundering hell-raiser. And both seemed to win every case. That’s when I realized there are many different paths, not one right path. That’s true of leadership as well. People with different personalities, different approaches, or different values succeed not because one set of values or practices is superior, but because their values and practices are genuine. And when you and your organization are true to yourselves–when you deliver results and a singular experience–customers can spot that from thirty thousand feet.”
Shortly after Apple returned to greatness (mid to late 2000’s) I started to come across CEO’s and executive directors that seemed to be modeling Steve Jobs. In fact, several said that they were. These ‘leaders’ were mercurial and churning through staff. Now, some 5-10 years later, all these Steve-Jobs-models have been fired, or they’ve burned out.
I could make a dozen points but the one I want to emphasize ties to Herb’s story. Choose a path whereby your values and practices are genuine. There are many paths – not one RIGHT path.
Pareto’s Rule is the 80/20 rule. It states that 80% of the output comes from 20% of the causes. Pareto’s Rule is usually used to reference work (or output). E.g. 80% of the work is done by 20% of the team.
In the fundraising world we see Pareto’s Rule on steroids. 97% of the funds come from 3% of your prospects. This is axiomatic… it doesn’t matter if you’re a large university or a small start-up. The ratio almost always holds.
When I share this with groups I’m always challenged. “What about NPR? What about Salvation Army?”
My answer: JOAN KROC!!!
We’ve studied the ratio for years… sometimes it’s 95/5 or 99/1 but the universal model of philanthropy holds true (for organizations that consistently advance impact!)
Are you focusing your time, your energy, your effort on the 97% that gives 3%? Or, are you focusing your time/energy/effort on the 3% that can generate 97% of the funds needed to help change, save and impact lives.
NB: None of this is to disparage the 97%. This simply requires that we take a hard look at the math and then make decisions about where to focus.
What business are you in?
Every MBA student hears about the story of the railroad industry. As the need for transportation grew and grew, the railroad industry failed to capture growth. It thought it was in the railroad business and failed to realize it was in the transportation business.
More recently, Blockbuster video hired big box retail executives to help grow its footprint. They thought they were in the big-box retail business and failed to realize they were in the content delivery business. Blockbuster declined to purchase Netflix in 2000 for $50M. Blockbuster – as a store – is long deceased and Netflix now has a $56Billion market cap.
Those are two examples of failure. Here are two examples of enduring success:
- “We are in the business of democratizing the skies.” – Herb Kelleher. Founder, Southwest Airlines.
- “We are in the reliability business.” FedEx
Asking, “What business are we in?” is a clarifying question.
Increasingly, we’re asking organizations to answer this in TWO ways.
What business are you in? (What is your promise?)
What business are you in? (What is your model focus?)
One is aspirational — around a customer promise and one is operational.
I think it could be argued that I’m really asking for mission + strategy. And… I am okay with that. In the real world there are many different ways to ask questions to arrive at clarity. The ‘What business are you in’ is a FOCUS question, we’re just coloring it with mission and strategy.
ALL of the examples above illustrate a statement of (customer) PROMISE. I don’t think an organization can really be strategic if it doesn’t focus on its core operation. As the examples illustrate, they can’t endure in IMPACT if they don’t know their promise.
Today we reflect on the life and message of Martin Luther King Jr. Here are some nuggets about the I Have a Dream speech. Appropriately, it comes up again and again, in studies of metaphor, engagement and story.
- Dr. King finished writing his speech at 4am, just hours before his address. It was originally entitled, “Normalcy, Never Again.”
King used over FIFTY metaphors in his speech! Contained therein was was an extended and powerful frame of the biblical struggle for freedom and the American struggle for freedom.
“I Have a Dream” represents a CHANGE of story to INSPIRE and LEAD! In The Story Factor, Annette Simmons writes that Dr. King’s refrain offers a positive vision that, “inspires generations to change their story from “I have been oppressed” to “I have a dream.”“
The original and prepared speech did not contain the phrase, “I Have a Dream!” 11 mins into the speech gospel singer Mahalia Jackson — sitting behind Dr. King — shouted “Tell ’em about the ‘dream,’ Martin, tell ’em about the ‘dream’!”
Dr. King recalled that he ‘just decided’ to go with it! In front of millions, he started RIFFING!
There is no substitute for authenticity. When I listen to Dr. King’s speech I believe I can FEEL his heart kick it up a notch with each riff. (Dr. King’s final speech ended up being DOUBLE the length of his prepared remarks.)
Story recounted in Originals by Adam Grant, and Shortcut.
To ‘Be For Impact’ is to have a very whole-person view… of impact… and of your own role (and vitality) in that impact. ‘Change the world’ is a common refrain in our sector but this begins by taking care of yourself.
Three years ago we asked ourselves, “What would it look like for our company to be completely and totally committed to health?” We launched THE SUMMER OF HEALTH. For 90 days we were ALL-IN in terms of supporting, incentivizing, and funding lifestyles of wellness, nutrition, and fitness.
That was a big success.
More than the impact it had on our team, the Summer of Health was a value (and a story) that catalyzed relationships beyond our team. I began to hear from readers that wanted to talk about HEALTH, first and foremost!
Health. Vitality. PERSONAL Impact. These are values that resonate for us and for others. So I wanted to share a quick update…
After the Summer of Health, we decided to adopt the commitment (and investment) as a permanent part of our culture and business model. We simply call it: CULTURE OF HEALTH.
Here are some selected stories from our team (as shared in our annual survey), almost three years in. The biggest words that come up again and again are PERMISSION and FAMILY.
“I’ve found it interesting how my efforts in the gym have spilled over into other aspects of my life. When I cook meals for us at home, I do so with my exercise and health goals in mind. These healthy meal choices affect my family as well as myself, and I think my enthusiasm for my gym routine has helped create a positive feedback loop where we work to support family members’ exercise goals.”
“I think one of the main things Culture of Health has given me is PERMISSION. Without having to worry about cost, I can do the kinds of self-care that I was probably hesitant to indulge in. A number of years ago I wrote down some dreams I had, and one of those included getting regular massages – not just once a year, but much more frequently – they are one of the ways I can fully relax and be taken care of. I’ve been getting massages every two months, and it’s such a great way to unplug, and basically do 90 minutes of meditation too (I struggle to do 5 minutes of meditation!). Having the same massage therapist has also meant she knows when things are out of whack with my body, and can give me a more holistic treatment.”
The family impact comes up again-and-again. “When I grew up we ate fast food and processed stuff. The Culture of Health has us thinking about nutrition. My kids are growing up with a completely different eating habit. That’s an impact that will last forever.”
“After reading It Starts with Food we [husband and I] decided to try the Whole 30. It then inspired my brother-in-law and his family. While the impact has been big on us, it’s been transformation on them. He’s down 60 pounds and going strong. I don’t think you expected to have the ripple impact through the Culture of Health but that’s what I’m seeing.”
When we first introduced the Summer of Health, we saw the loss of weight, energy spikes and the like. Then things started to normalize.
While that might seem bad, I think it’s simply normal and probably more ‘practically sustainable’. I’ve also notice the ‘normalized conversation’ changes. It moves from ‘diet and exercise’ to ‘environment, nutrition, and fitness’… and I hope we can continue to move forward toward ‘vitality’.
In my mind our overall ‘health and vitality’ went like this.
Overall, this continues to be the right move. On average it’s an incremental financial investment of 3% to 4% each year to our bottom line. The financial return is not a straightforward calculus — but it’s there. Moreover, the impact return is transformational (and generational).
We all want to impact the world. Hopefully, this post gives you a little PERMISSION to take care of yourself, first!
Most people don’t know how to keep control of the next action when leaving a voicemail. This can have a huge / negative impact on your selling, fundraising, or follow-up in general! This is a tactic I picked up early in my sales career. It’s simple and effective.
Most people leave a very standard voicemail. “This is Nick Fellers, I’m calling about XYZ. My phone number is 614-352-2505. Please call me back.”
Do not leave the responsibility for follow-up with the prospect. It’s YOUR responsibility!
Instead, “It’s Nick Fellers, I’m calling to connect about ______. I’m sorry I missed you. You can reach me at 614-352-2505. Or, I’ll try you again later.”
This keeps you in control of the follow-up action.
This tweet caught my eye. (If you’re reading this via email or rss reader, make sure you load the picture).
From U.S. Chief Data Scientist, DJ Patil.
— DJ Patil (@DJ44) January 11, 2017
What a GREAT notecard!
-Dream in Years.
-Plan in months.
-Evaluate in weeks.
-Prototype for 1x
-Build for 10x
-Engineer for 100x
-What’s required to cut the timeline in 1/2
-What needs to be done to double the impact