We’ve all seen the TED talk by now. At the time of writing this, Simon Sinek’s 18-minute monologue on how great leaders inspire action has drawn almost 44 million views and has secured its place as one of the top 25 most popular TED talks of all time. Sinek’s message was as profound as it was simple—that people don’t buy what you do; they buy why you do it. The greatest generational companies of our time, such as Apple, Harley-Davidson, and Southwest Airlines, deliver so much more than just products customers love; they create movements around their brands. Their secret? According to Sinek, these outlier companies inspire loyalty and motivate their followers and employees to stick with them through thick or thin by starting with why, while their competitors start with what. Category creation, too, must start with why. The truth is that every company—whether creating a new category or disrupting an existing one—should define their purpose and what they stand for as an organization. Purpose is foundational to success in the B2H era. With products (the what) becoming more commoditized over time, customers have more choice than ever before and will elect to do business with companies they respect and admire. Aligning brand to core human need has become far more than just the right thing to do, but the only way for a company to survive. This is especially true of companies creating a category, which, as I explained in Chapter One, is a noble mission that requires the patience of long-term greed in order to inspire an entire market into existence. Inspiration becomes a “higher calling” for both employees enrolled in the mission and members of the community who participate. To be successful in this endeavor, your brand must stand for something bigger than simply the products that you create, and beyond that, the community needs to know it. There are several reasons why living your purpose out loud is the foundation of creating and dominating a new category. Purpose informs your brand, shows the industry and community a preview of the world you are creating, and inspires the values that will guide your decision making along the journey. Purpose draws talent into your company, retaining leaders within the movement that you’re building and creating a sense of vocational fulfillment through seasons of both triumph and trial. Purpose inspires your community to navigate uncharted waters together toward the idealistic true north that you’ve described. Finally, purpose helps grow your business by attracting customers who build stronger emotional connections that go far beyond a transactional relationship. According to the 2018 Cone/Porter Novelli Purpose Study, nearly eight in ten (79%) of Americans say they are more loyal to purpose-driven brands than to traditional brands and 66% would switch from a product they typically buy, to a new product from a purpose-driven company.1 A great example of a modern, purpose-driven brand in B2B is ServiceNow, the leading digital workflow company who in 2018 went through an exercise to dial into their purpose. They also just happen to be the second most valuable cloud company in the world, with a $50B+ market cap—no coincidence there. ServiceNow was founded by Fred Luddy in 2004 on a simple idea of helping everyday people route work across the enterprise—a mantra that gave the company and their employees deep meaning in creating technology in the service of people. They arrived at a re-articulation of their purpose in 2018 of “we make work, work better for people,” a powerful statement that remains true to Luddy’s original vision for the company and thrust ServiceNow deep into the heart of the future of work conversation. Dan Rogers, chief marketing officer at ServiceNow, referred to the process they took to articulate purpose as “a grounding effort for the whole company” and at the core of “everything [they] do.” Purpose serves as a source of inspiration for ServiceNow’s employees, who work for a company with a why that they themselves can connect to personally. ServiceNow debuted their refreshed purpose at their Knowledge conference in May 2018 before a captive audience of 18,000 attendees. Part of the announcement included the reveal of their refreshed brand expression that featured a new corporate identity, as seen in Figure 5.1. The company brilliantly expressed their purpose in the visual design of the logo itself, choosing to move away from the product-centric on/off visual in the “o” of the logo to a human-centric person icon. As Rogers put it, the notion “that you could find yourself in our logo is a very important idea for us.” For Rogers and the ServiceNow team, purpose was not merely a clever line of marketing copy written on the homepage, but the rudder for how the company operates and how it shows up and expresses itself in the marketplace. They believe it deeply, but they also live it out loud. One of the most prolific voices on the power of purpose in building enduring companies is Jim Collins, an author, consultant, and lecturer who has written six books that have sold more than 10 million copies in total worldwide. In perhaps his most iconic work, Built to Last: Successful Habits of Visionary Companies, Collins drew upon a six-year research project at Stanford University of 18 truly exceptional and generational companies that have an average age of nearly 100 years and have outperformed the general stock market by a factor of 15 since 1926. One of the key reasons why these companies have withstood the test of time is an early orientation around defining what Collins calls core ideology in both purpose and values. In Built to Last, Collins goes on to name five important characteristics of a good expression of a company’s core purpose: Disney’s purpose is to “make people happy”—a timeless statement that checks the box for all five principles. Southwest Airlines’ purpose, similarly, is to “democratize the skies.” The sentiment of Collins’s five principles were reflected in a 1960 speech by David Packard to Hewlett-Packard’s training group, where he said, “purpose should not be confused with specific goals or business strategies (which should change many times in 100 years). Whereas you might achieve a goal or complete a strategy, you cannot fulfill a purpose; it’s like a guiding star on the horizon—forever pursued but never reached. Yet although purpose itself does not change, it does inspire change. The very fact that purpose can never be fully realized means that an organization can never stop stimulating change and progress.” Arriving at shared organizational purpose may feel like an intimidating endeavor since companies are made up of diverse sets of individuals, and purpose, by its very nature, is an emotional and often personal construct. In order to help demystify the process, I’ve recruited the help of John Rex, the former CFO of Microsoft North America, whose firm, Rex Executive Leadership, is a leading source of leadership coaching for technology executives. John helps growth-minded executives deliver impact and accelerate their success and believes great leadership is grounded in humility. Inspired by Jim Collins and his five principles of company purpose, John believes that there are three important steps that you and your teams can take to put those principles into action and articulate your very own purpose: Setting aside time with your team to develop and articulate purpose is an important exercise to understanding why your company exists, and the role you’ll play in creating a category. There are also benefits to hiring professional facilitators like John to assist in this discovery process—whether to help overcome the bias of agreeing with the boss or to enable the group to do their best thinking without the distraction of orchestrating conversation. Also, defining the why behind your business is only the beginning of truly unlocking the leadership principles that will power your success moving forward. Leadership coaches can help teams build on their purpose by articulating vision (who they want to become), values (how they choose to act), and operating principles (the way things get done in alignment with purpose, vision, and values). While making the time and resources available for this discovery process can be misconstrued as a distraction, make no mistake, it’s ultimately the foundation of your success in category creation. At Gainsight, we’ve always been extremely values-driven as a company, even from day one. Today our values point back to our shared purpose and are used to help ensure that each of our teammates, from leadership to early career, are always working in alignment toward the same goal. But I will admit, we approached the effort a bit out of order—starting with the how over the why. From the early days of the company, we knew that we wanted to build a company that behaved in accordance with the following principles: Our values were always deeply meaningful for us, but alone, lacked an expression into a deeper purpose of our daily effort building enterprise software. Don’t get me wrong; there’s a lot of good in enterprise software, but we’re not exactly trying to save humanity by flying rockets and cars into space to one day colonize new worlds (thanks for setting the bar, Elon). If your job, like mine, is doing something that you think is important but isn’t quite in the category of “the future of human existence,” how do you justify it to yourself and your team? Enterprise software can certainly be a good business, but can it feel good too? One day it hit us, that we may not change the world with what we do, in a realistic sense, but we can change the worlds of those around us in terms of why and how we do the things we do. We long for something different in the why and the how of business. We respect the bottom line and recognize its importance, but we don’t bow down to it as our only master. People are just as important as business—and they aren’t “assets” or “human capital,” as some companies might claim. Not everything has to drive to shareholder value, because you can have multiple goals. Teammates can thrive at work without having to give themselves up in the process. In fact, we believe society needs this more than ever. With artificial intelligence, automation, robots, and the like, humans are having our own existential crisis. Every screen, selfie, and social network makes us long that much more for a real smile and shared moment. So we finally wrote it down. We decided on the why that would keep us going long beyond the day-to-day. Our purpose at Gainsight is: to be living proof that you can win in business while being human-first. Human-first means always thinking about people in the decisions you make about business: Does human-first mean you don’t make tough decisions? Of course not. Human-first companies will do things from time to time that don’t feel great. But our test for Gainsight is that if we’re causing pain for others in the interest of a “rational” decision, we better be feeling that pain ourselves many times over—or we’ve lost our humanity. That pain is what will make us always think of people in decision making. We feel like we can help a lot of humans—between our customers, our teammates, their families, our shareholders, and our communities. Maybe it’s not all of humanity, but it’s a start. And if we, like many other companies going down this path, can help other businesses open their eyes to another way to work, that impact can grow even more. For companies like Gainsight that are creating new categories, there’s a hyper-important sixth characteristic that did not make it onto Collins’s classic list from 1994—it absolutely must be inspiring to your community as well. Call it the Kennada Amendment, but the whole notion of cultivating a tribe of people who are bound together by common purpose is as powerful in the professional context as it is influential in our social psychology as humans. This is especially the case in new markets, as individual early adopters can often feel like they’re on their career journey alone. We’ll unpack why building and growing community is key to category creation in Chapter Eight, but the truth is that any community or tribe of people will look to a leader to guide them into the future—an imperative for any brand desiring a market leadership position. Earning that title requires creating and articulating an inspirational purpose for the company in service of the community, and being able to build good habits to activate that purpose and truly live it out loud. If executed correctly, communities will actually reflect the culture of the market leader, creating an emotional connection between the two parties. In a recursive sort of way, Gainsight’s purpose nests well in the purpose of the customer success community—the movement that we serve at Gainsight. Customer success is fundamentally about realizing that your customer is not a transaction or a deal or an opportunity or a lead. Your customer is a bunch of human beings just like you. And just like you, they want to succeed with what they do. In a way, customer success is about bringing humanity back into this technology-driven world. We revealed our new human-first purpose on stage at our Pulse 2018 conference in front of over 5,000 members of our community who adopted the phrase as a rallying cry of their own. They’ve always known that customer success is fundamentally a human endeavor, but we put that intuition into words and invested to activate them in the marketplace—giving all who would listen an opportunity to join the movement we were building. Once you’ve arrived at a shared organizational purpose, your job is far from over. Like the ServiceNow and Gainsight examples from earlier in the chapter demonstrated, your purpose needs to create resonance outside the walls of your organization and into the community that you’re creating. Marketing plays a critical role here to “activate” purpose, or said another way, to increase both internal and external awareness and engagement around it. That’s critically important to make sure everyone who interacts with your brand—whether online, in meetings, or at live events—can be left with an impression of who you are and what you stand for. These activations, when communicated authentically, help invest in your brand equity as the category leader and inspire your followers to stay engaged as you lead them into the future. Here are a few ideas for ways marketers can activate purpose into the marketplace: These are only a few ideas to start activating your purpose and values—concepts that when developed authentically, can create a halo effect around your brand in the early market you are building and leading. As you add other ideas to the list, you’ll notice a dedicated track starting to emerge within your content marketing strategy that’s focused on purpose and corporate marketing. Your audience will continue to have an interest that goes well beyond what you’re doing to build your category, but how, and most importantly, why. But external members of your community are not the only ones paying attention to these activations. It’s important to keep purpose and values in front of teammates as well, as they, ultimately, are the most important constituents of these principles and whose buy-in may be the difference between success and failure in the long game of category creation. I mentioned earlier that category creation carries a “higher calling” for both members of the community as well as for teammates who are enrolled in the mission. Defining an inspiring core ideology is the most powerful way to recruit talent into your company and retain them for the long (and I mean long) road ahead. As leaders of companies, it’s important to think about teammates as our internal customers. Like the trends we’re seeing with clients in the marketplace, employees today have more choices than ever before of companies they can work for. Activating your purpose in the marketplace can become a competitive advantage for talent recruitment that differentiates your brand from other “disruptors” in the industry. Also, the reality is that category creation, as we discussed in Chapter Three, can be extremely difficult. While other companies may enjoy obvious product/market fit in a category that is well established, category creators must invent both product and market at the same time. Figuring out repeatable sales models and scalable GTM processes will come over time and typically after making many mistakes—a convicting purpose and set of values can keep the team engaged and pushing through, create deep meaning in their work, and focus on the noble mission at hand. A 2014 survey from the Energy Project, an engagement and performance firm that focuses on workplace fulfillment, found that 50% of employees lack a level of meaning and significance at work. However, employees who derive meaning from their work are more than three times as likely to stay with their company, and also report 1.7x higher job satisfaction and are 1.4x more engaged at work.2 Defining the why behind your company is the critical first step of your category creation journey that will inform the rest of your decision making going forward. But now that you’ve started with why, it’s time to focus on the who.How to Develop a Shared Vision Around Company Purpose
The Power of Purpose in Category Creation
How to Activate Purpose and Values
Why Purpose, Values, and Culture Matter to Teammates
Notes
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