Purpose is the new Leadership

Leadership is Dead….

….

by Christos Tsolkas

Purpose is everywhere – have you noticed?

Simon Sinek’s Ted Talk “Start with Why” has over 26 million views and is the third most popular Ted Talk ever. Search purpose on HBR’s website and 1,796 articles are available to read. Google “purpose + leadership + organization” and you get 290 million results.

What are we looking for purpose to do? The answer is all over the map. Purpose is a personal, physical and even spiritual need – according to life coach Richard Leider and pastor Rick Warren. Purpose is critical for leadership, claim Nick Craig, Scott Snook, and Bill George. Sinek connects our urge for purpose to the limbic center of the brain to explain our urge for inspiration as employees and customers. Shared purpose, says Mark Bonchek, activates an organization’s mission by connecting to customers. Meanwhile, organizations are on fire for purpose. According to HBR’s 2015 report,  “The Business Case for Purpose” 80 percent of CEOs think purpose is important for their organizations, but less than 50 percent have figured out how to define and put purpose into action.

Purpose, in other words, guides us on our life journey, lifts us with a sense higher calling, engages, inspires and motivates us with meaning, and connects us to the significance of our work in serving others.

 Isn’t that what leadership is supposed to do?

Like most executives who have led organizations and teams, and coached and developed others into leadership roles, I think a lot about leadership. For most of my career, top leaders have fit a particular mold. They have extensive experience and success in their profession or industry, and reached their position by steadily climbing the ladder of responsibility. They have impressive insight and know-how in their field of expertise and are able to think strategically while also effectively managing resources, people, and plans. They have a certain degree of personal magnetism, though some are more charismatic than others. Some are also strong at communication, vision or inspiration but these have never seemed essential to the job description.

The problem is that

. It’s losing traction and impact, failing to resonate or connect with followers, and sounding inauthentic.

Take the 2016 American Presidential primary contests as an example. Establishment candidates with credibility, know-how and practical experience come across as inauthentic or packaged and are losing the passion battle to outsiders with strong personalities, unique voices and a more emotional connection to followers. (See also: Barack Obama, 2008.) Meanwhile, in business, young CEO / founders who lack the extensive business and management experience we’ve long associated with effective leadership somehow manage to build impressive companies, raise immense capital, attract fervent followers, and win over customers if not create entirely new market categories.

In fact, the difference goes deeper. Consider how a traditional leader might answer the question,

“Why do you want to lead?”

Traditional politicians are likely to give clichéd answers while traditional business leaders may be baffled by the very question. Forced, they are likely to say something about shareholder value, or employee and customer satisfaction or maybe talent and diversity.

Ask the new breed of leader that same question, and you will get a very concrete and clear response. Elon Musk for example, wants to save humanity. Whether he will finally do it or not there’s no denying the authenticity of intention because the words and the leader’s own personality and personal story are intertwined and consistent.

such leaders are communicating. They are emotionally drawn to the leader’s articulation of why something matters and what’s at stake. They are less interested in scrutinizing whether that leader has a practical way forward or the experience to do what they say. I don’t think this is because those followers are naïve, but because they see incremental, zero sum, pragmatic solutions as more of the same and have a strong desire for disruptive change to the status quo.

 

Leadership is dead. Purpose is the new leadership.

 

Purpose does all the things that leadership is supposed to do. But purpose is doing those things in a very different way. While that might seem like a radical departure, it’s also a logical evolutionary step in terms of what we look to leadership to provide. Consider how leadership has changed over the past century.

 

Leadership Journey Stage I: The Manager in Chief

In the early days of corporate world, leaders were more prized for their managerial traits than they are today. We needed leaders for their ability to refine processes, use resources efficiently, and maximize outputs. Think Frederick Winslow Taylor.

These new manager / leaders were distinct from leaders of the previous era who were more associated with pomp, ceremony, and inherited position or class. Yet, their logistical acumen was perfect for meeting the needs of a rapidly industrializing world in which customers wanted low-cost, mass-produced manufactured goods and companies raced to supply them.

Post-World War II, the great management theorists like Peter Drucker and leaders like Alfred Sloan helped turn the process of management into a science at big companies such as General Motors. The engineer with a degree in Management was the face of corporate America and increasingly the world. Leader primarily meant command-and-control.

 

Leadership Journey Stage II: MBA Meets Mad Men

From the 1950s through the 1960s, business needs began to change. Efficient industrial manufacturing generated tremendous economic growth, gave consumers more purchasing power, and filled markets with categories of goods so similar to one another that they needed to seriously differentiate and compete on brand.

Leadership shifted in focus from process and efficiency to marketing and sales. The best leaders understood or appreciated the power of a brand to make a connection with consumers. At the same time, that sense of connection to a brand also tied employees to their organizations. You were an IBM man or a General Motors man.

 

Leadership Journey Stage III: Crisis Leadership

In the early 1970s, the tide turned. The Vietnam War undermined confidence in American ideals and brands. The Oil shocks of the 1970s and stagflation stifled economic growth. The Cold War intensified. Crime and unrest increased in cities that were becoming decrepit and dangerous.

During this period of crisis, people looked for leaders with strength, confidence and a sense of direction.

Leaders learned to motivate and inspire, but their credibility came from their practical experience and proven success. This mix of charisma and demonstrated capability shaped the model we expect today.

 

Leadership Journey Stage IV: The Hierarchy Flattens

In the early 1990s, companies began to change in response to technological shifts and global competition. IBM and GE laid off hundreds of thousands of workers to become more lean and focused.

Cutting the fat also changed the way people worked and how they felt about employment. Loyalty was out. Hierarchy was flattened. Leaders had less authority and needed to become better at influencing and communicating. Relationships and networks became more important than command-and-control.

 

Leadership Journey Stage V: Change Speeds Up

The dot com bubble of the late 1990s accelerated the flattening of hierarchy and changed our ideas about business success. The crash of 2000 was only a temporary speed bump on that progression. Today, we talk even more explicitly about disruptive innovation, lean processes, and startup mentalities – even in large and established companies. The mindset today holds that:

  1. Better daring than trivial
  2. The quality of the leading team beats the plan since every plan is proven to be wrong
  3. Failing fast is more important than succeeding slow
  4. Hi potential is better than hi actual performance

These new rules have contributed to turning leadership on its head.

Now, we live in a world where markets are everywhere and nowhere; dominant companies can be big or small; time, distance and resources have almost no meaning; and brains have become commodities that can be bought or borrowed cheaply. The most sophisticated components of any process today can be outsourced, offshored, or made and delivered from anywhere. Ideas can be copied in light speed. Inventions and patents can be bought. It’s all on the web, free or easy.

 So

.

 

Moonshots and Moonbeams

Even people in the leadership development business don’t think leadership is working anymore. A recent note from McKinsey claims:

 

The almost insatiable demand for leadership studies is a natural outgrowth of the all-too-frequent leadership failures in government, business, and nonprofits. Few people trust their leaders, according to the Edelman Trust Barometer surveys, among others. Gallup data show low levels of employee engagement worldwide, while the Conference Board finds job satisfaction at a low ebb and executive tenures decreasing. Other research consistently indicates that companies give their own leadership-development efforts low marks. Leaders aren’t doing a good job for themselves or their workplaces, and things don’t seem to be improving.

 

Disappointment and distrust in traditional leadership has grown in the past 15 years as the world has experienced a litany of leadership failures and catastrophes. Enron. September 11. The Iraq War. The mortgage crisis and Great Recession of 2008. Collapse in the Middle East. Climate change. Stagnant wages and wealth growth. Terrorism. Fundamentalism. Comeback of fascism. The Syrian refugee crisis. Europe is shaking after Brexit.

All the old attributes of leadership – expertise, experience, practical know-how and position – seem less credible and meaningful.

As people have lost faith in leaders and leadership, they’ve begun to look for something different. They are seeking values and principles they can believe in, embodied in leaders who seem to live those values authentically. Customers want the same from the companies whose products they buy. Generation Y workforce believe is stories told by their leaders that they will break through the universal noise.

This desire for meaning can be dangerous. Followers can be attracted to powerful ideologies – such as Nazism and ISIS. Yet, followers are also attracted to ideas and people that drive positive change.

A leader like Blake Mycoskie of Toms’ Shoes, for example, developed a business model that meets traditional demands for revenue and growth in order to funnel funds to poor people. Elon Musk is building a car company in order to change our reliance on fossil fuels. Muhammad Yunus turned traditional banking into a vehicle for funding the micro-businesses of people ignored by financiers and lenders.

Such leaders are not satisfied with small goals; they want to make moonshots happen. If they don’t have the expertise, resources, or talent to do it, they go find it.

As more employees, customers, investors, and influencers are drawn to this type of leadership, it will be increasingly important for other leaders – us, and companies – ours, to understand and compete in the marketplace for purpose.

 

Leadership is dead. Purpose is the new leadership.

 

Categories: BLOG, MY WRITING

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