How can leaders build sustainable cultures and business models? What has the collapse of industry leaders such as Enron, WorldCom, and Arthur Andersen taught us about what happens when firms become so singularly focused on profit that they lose their moral compass and forget their greater purpose? Why are traditional definitions of leadership stale and ineffective?
Engagement is still the secret sauce that sets leading companies apart. However, employee engagement, profit, growth, client satisfaction and even solid leadership by themselves are not sustainable. They are all outcomes of something bigger.
Sustainability is driven by what I call “creativeship.” Let me explain. I've often defined leadership as the ability to lead people, build fellowship, and achieve profitable growth. During a recent keynote, I highlighted how iconic companies such as Digital Equipment Corporation, Polaroid, Arthur D. Little, and Wang all went bankrupt despite having satisfied employees and extraordinary leaders. As I pondered how that could be, I realized that our traditional definition of leadership is no longer enough to sustain most businesses. Today, leadership has necessarily morphed into creativeship—the need to build sustainable businesses and cultures.
This evolution of leadership means that companies need to expand their traditional definition of sustainability. What originated as a catchall environmental phrase (i.e. alternative energy, carbon footprints, water conservation, etc.), must now encompass accounting practices, innovation, globalization, and more—the myriad factors that risk a firm's sustainability.
Exploration into these failed companies also highlighted another important creativeship lesson: the need for a company to have a purpose. These high-profile collapses illustrate what happens when companies focus on profit and lose sight of their purpose. Successful companies will be those that make corporate social responsibility part of their DNA. It's been proven that socially conscious organizations outperform those solely committed to beating the competition).
Much has been written about Generation Y or being a “purpose” generation. A pararell trend is the increasing role Baby Boomers are playing in leading and initiating corporate social responsibility activites as they push their employers to donate to charities, reduce their carbon footprint, and support volunteerism. After years of focusing on wealth accumulation and climbing the corpoate ladder, boomers are now refocusing their priorities with a concentration on purpose.
I believe this is why organizations must define both their “what they do” and “why they do it” by crystallizing their employment value proposition (EVP) as a means to retain, attract, and hire the best employees. For example, we know Whole Foods Market sells perishable consumer goods. But its purpose statement clearly specifies the “why” within their EVP: “Provide choices for nurturing the body, the community, and the planet.” Or, we know that Starbucks sells premium coffee. But its EVP is: “To inspire and nurture the human spirit—one person, one cup, and one neighborhood at a time.”
While Google, Facebook and other high-tech companies have made it tougher for Microsoft to recruit and retain top employees and engineers over the years, the Redmond-based software giant believes its philanthropic efforts are attracting talent now more than ever. Brad Smith, Microsoft's general counsel, explained to reporters after Microsoft recently marked its 30th Employee Giving Campaign how the company's reputation as a charitable organization is a recruiting tool and that this is an area where Microsoft continues to set the pace for the entire technology sector. “When you're living through a time when unemployment is up and when people see more human needs, there is a greater focus now on what companies and employees are doing to address those human needs,” Smith explained.
Smith said he “frequently” hears from young interns and employees that Microsoft's broad citizenship efforts are part of what people find attractive about the company. “The opportunity to work on great products and services is hugely important and always will be,” he says, “but they also really value the broader connections that a company has in the community.”
Clients often ask me how to boost engagement without having a budget. I encourage them to establish a “purpose” task team, consisting of a cross-sectional group of volunteers. This team should be charged with hunting down the various ad hoc initiatives currently taking place internally (they are, you just might not be aware), and begin branding and promoting these initiatives. Activities like walk for hunger, corporate challenges, food drives, and other forms of volunteerism are already being championed by your employees. Once formally captured and promoted by the company, others will also get involved as you begin to position your EVP as a company that cares. Soon, prospective employees will aspire to be a part of your organization.
The goal is to get at the heads—and the hearts—of employees and prospective recruits alike.
Bob Kelleher is the founder of the Employee Engagement Group, a global consulting firm that works with leadership teams to implement best-in-class leadership and employee engagement programs, workshops and surveys. He also appears frequently in national media and publications such as CNBC, CBS Radio, BusinessWeek, Forbes, Training Magazine, Yahoo and Fortune. His newest book is Creativeship: A Novel for Evolving Leaders.