Executives and Purpose

Normal employees of an organisation have a responsibility to fulfill the purpose of the organisation. Executives have the same responsibility, however in addition, they have the responsibility to ensure that the organisation has a purpose, make that purpose clear, and ensure that the organisation is aligned around that purpose.

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Some executives take an autocratic approach to determining the purpose of the organisation meaning that they decide. Some executives take a facilitation based approach, seeking to use the combined wisdom of the organisation. Regardless of the approach, the responsibility for ensuring that an organisation has the right purpose lies with the executives.

Herzberg’s classic HBR article identified that there are hygiene factors which need to be met otherwise an individual will leave the organisation, and factors that motivate them. Dan Pink’s “Drive” states that individuals in an organisation need Autonomy, Mastery and Purpose to be motivated. Successful organisations compete for high performing, highly motivated individuals as they understand that they give them the edge in the massively competitive marketplace. For high performing motivated individuals, autonomy, mastery and purpose are not motivators, they are hygiene factors. If high performing motivated individuals do not have autonomy, mastery and purpose, they will leave and go to somewhere that they do. Autonomy and mastery are local phenomena within an organisation. It is possible for a leader to create a bubble in which their team have autonomy and can achieve mastery. Purpose however requires the support and commitment of executives.

The worst possible situation for an organisation is where they are meeting the hygiene factors of their employees but their employees are not motivated. No one will leave but they are not motivated to learn or improve their skills. An organisation like this may appear to be healthy but has no long term future.

Purpose and Identity

Part of the Identity of a individual is their position in a network. We have an identity in our family, with our friends, in our community, and in our work. As an individual, we have an identity in many different networks and one of the most important things about our identity is its “value” to the network, or self worth. Self worth is how much we perceive our value in total. We will gravitate towards networks in which we are most valued, or where we can gain knowledge and/or experience that will increase our value in other networks.

The purpose of the organisation determines the value of our activity. If the purpose of our organisation is to create cheap cars that are cheap to run, then it will not value our efforts to build the fastest car possible… unless that effort results in learning and insight about how to make cheap cars that are cheap to run. A person with expertise on creating fast cars is likely to leave a job in a company that makes cheap cars and move to one where their knowledge and experience is valued.

So purpose is another way of describing the values of the company. As Dave Snowden says “101 Anthropology states that as soon as you write your values down, you lose them”. This means that the executives as the guardians of the organisations rules are also the guardians of the stated and unstated (written and unwritten) purpose of the organisation. This means that that they need to give energy and approval to activities that are aligned with the (stated and unstated) purpose of the organisation and remove energy from activities that are counter to the purpose of the organisation. Executives need to increase the value of individuals in the network that are doing the right thing. Executives need to be what Derek Siver’s calls a first followers. They need to understand the constraints that mean individuals that are not aligned with the purpose of the organisation. Once understood, these constraints (often incentives) need to be modified so alignment occurs. This is particularly import for transformation efforts.

The purpose of an organisation determines its identity and the identity (including value) of everyone involved in the organisation.

Identity and Transformations

Every organisation engaged in a (delete as appropriate) [ Digital/DevOps/Agile/Lean/Spotify ] [ Transformation/Improvement/Make Better ] [ Programme/Initiatve ] needs to understand that the transformation involves changing the identity and purpose of the organisation, and the identity and value of everyone within the organisation. It is normal that the desire to change the purpose of the organisation conflicts with the desire of individuals within the organisation to maintain their value and hence identity. It is vital that executives engage in the transformation and create clear statements about purpose (value), reward individuals that are aligned with the purpose, and sideline individuals that are not aligned with the new purpose.

So who are the individuals that are most going to resist a change in identity? Those individuals that have the most the to lose. In other words, individuals that are perceived as high value in the current organisation but will either know they will have lower value in the new organisation, or even worse, are uncertain whether they will have a lower value in the new organisation.

It is important for executives involved in an organisation to help those individuals understand that if they move to the new organisation, they will be more valued than before regardless of how effective they are are in the new organisation. It is important  that the executive helps them understand that if they oppose the move to the new organisation, they will have no value to the organisation.

The worst thing that an executive can do is do nothing. They allow individuals who oppose the change to maintain a high value role in the new organisation. This sends a clear message that the new organisational purpose (values) is not actually valued.

The Role of Executives in a Transformation

The first responsibility of the Executives in a company undergoing a transformation is to create a vision for the new transformed organisation. This is another way of saying they need to ensure the purpose for the new transformed organisation is clearly articulated. An important part of that is to ensure that appropriate metrics (measures) are articulated to indicate a successful transformation.

Second, the executives need to communicate the purpose (and metrics) to the whole organisation. This allows people to opt in to the new organisation at a point that is comfortable to them. In other words when they feel their identity in the new organisation will be more valuable than their identity in the existing organisation. This is a continuous process, and the awkward badly formed communication should gradually improve over time as more and more people join in.

Third, the executives need to engage with those entering the new organisation, ensuring that they are clear on the purpose of the new organisation whether stated or unstated. The purpose of this engagement is to connect with the people in the new organisation so that they can reach out the executives when they need to without having to go through any escalation process. The most effective mechanism I’ve experienced for this engagement is Dan Mezick’s Open Space Agility.

In traditional organisations, executives see a rose tinted view of reality. Everything they see has been filtered through several layers of excel and/or powerpoint. The filtering protects them as much as the people doing the filtering. They have plausible deniability. In the transformed organisation, the executive needs to be able to see an unfiltered representation of the organisation. Rather than use that representation to make decisions, they should use it to identify those place where they should “Go to the Gemba”. The executives should “Go to the Gemba” to support those individuals who’s actions are alligned with the new purpose, and also those who’s actions are not aligned with the new purpose. In addition, they should go to the Gemba to see the reality of any project that is struggling to see how they can assist them.

This is the fourth responsibility of the executive. To “Go to the Gemba”, “To go to the place where the work is done”, to increase the value of those identities that are aligned with the new purpose, and diminish the value of those that are not.

The fifth responsibility is to “Go to the Gemba” to assist. To bypass the escalation process by directly observing the constraints and prioritising resources to resolving the constraint.

Executives are the guardians of the purpose of the organisation. Their responsibility is to actively engage and support the organisation as it moves towards its new purpose. Their responsibility is to “Go to the Gemba” so that they can see reality rather live a life of contentment behind rose tinted spreadsheets and presentations.

About theitriskmanager

A IT programme manager specialising in delivering trading and risk management systems in Investment Banks. I achieve this by focusing on risk rather than cost. A focus on costs can lead to increased costs. View all posts by theitriskmanager

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