The need to have the team reconnect to Purpose is never higher than when the team is failing in its mission. Research that I have been conducting for more than ten years is suggesting that the Purpose of both Organizations and Individuals tends to be revealed in earnest during periods of adversity. World War II movies show Russian soldiers urged by the Commissars to advance towards Berlin to build socialism. However, only a few months earlier, when in desperate conditions, the same soldiers were freely stating in their defensive positions that their Purpose was to protect the Motherland. Patriotism- not Socialism- was the true Purpose of these Soldiers and Patriotism eventually prevailed.
Unfortunately,Purpose is a word more used than undestood in our times. Among those who invoke it, some put a lot of emphasis on communications. This is an oxymoron, for when Purpose exists it does communicate. Some others conflate organizational and personnal Purpose. They both exist, but they are distinct. Finally some others trivialize Purpose by defining it in terms appealing to their emotions. Purpose, however, as I explain in my eponemous book, is a concept of Moral Philosophy. It cannot be defined subjectively. It is not trivial to discover it, but it is worth doing so. As Clausevitz, the founder of what we call Strategy, pointed out, Purpose is the best anchor of Alignment. Alignment of Strategy, Organizationa Design, Values, People and Financials is what most of the daily struggle of Firms and Agencies is all about.
Chairman, Piramal Enterprises Limited
From a rock-bottom scenario with Piramal Enterprises Ltd, Ajay Piramal revived the family business to make it one of the top 5 pharma companies in India. In this beautiful piece he talks about the four elements that can build Indian leadership.
The 4 tenets of leading India
Published on Mon, Nov, 2009 a 7:20 , Updated at Mon, Nov, 2009 at 8:01 Source: Moneycontrol.com
“If you always do what you always did, you will always get what you always got.” I wish I had written this line. It is almost universally true – in the context of the environment, governance, business and relationships.
When we look at the business landscape, this was the decade of Indian managers – we saw Indians at the helm of global corporations – Indra Nooyi, Vikram Pandit, Rajat Gupta to name a few. Companies of Indian origin have also left a footprint on the global canvas. We, Indian professionals, are credited for our resilience, operational skills, cost effectiveness and strong problem solving skills on the world scene. But, we are not perceived to be transformational and seen as lacking in team building and leadership skills. Do we really have it in us? Can we move from being efficient managers to being authors of global industry transformation? Can we change gears from being managers to leaders?
Now, we need Indian leaders and visionaries. We need our own version of Sam Walton, Jack Welch, Steve Jobs; leaders who will transform industries and lives. Especially, sectors such as healthcare, financial services, IT, telecommunication and entertainment offer huge potential for transformation. We need to build a leadership brand based on Indian values but on a global level. In a world with a painfully fresh memory of Enron and Lehman, discipline, ethics and transparency are critical for any leadership brand.
The brand of Indian leadership can be built on four elements:
1. Your drive and passion
“You are what your deep, driving desire is. As your desire is, so is your will.
As your will is, so is your deed. As your deed is, so is your destiny.” – Upanishad
The one notable characteristics of successful people is they are all consumed by a purpose. The purpose is not material possessions or even attaining fame. Two Japanese engineers Masaru Ibuka and Akio Morita founded Sony over half a century ago in 1946. Their purpose was to erase the ‘poor quality’ tag that the country had acquired post World War II – that Sony became the most innovative company was an unplanned consequence.
Nikos Mourkogiannis, academician and author writes “Purpose is not a responsibility of any kind. It is not a ‘mission,’ ‘vision’ or ‘value’ – at least not the kind that can be codified in a ‘mission, vision, and values’ statement. It is none of these things because, at heart, purpose is a call to action.”
Mourkogiannis divides purposes into four broad categories. Each of these will require a different variety of leadership, different set competencies, and different measure of success. “Purpose revolves around four conceptions of what is right and worthwhile; they involve pursuit of discovery (the new), excellence (the intrinsically beautiful), altruism (the helpful) and heroism (the effective).”
Sam Walton did not have any vision to make Wal-Mart a USD 300 billion enterprise. But he had a purpose: to give the customer a wide variety and a good deal (altruism). Starbucks founder Howard Schultz didn’t want to build the largest coffee chain, he wanted to build the best coffee experience (excellence).
According to Anand Kumaraswamy author of Gandhi on personal leadership, “a strong sense of purpose can accomplish three things for us – it can be a rich source of happiness, self esteem and fulfillment, it can help us overcome adversities and it can help us transcend the work – joy dichotomy”. I would like to add “it can force us to transform lives and create value.”
2. Ego and Anger
Ego is like fire, it is a bad master but a powerful slave. If your ego is subservient to your purpose it can make an enormous impact. Reliance Infocomm’s ego was slave to Dhirubhai Ambani’s purpose to democratise telecommunication. Hence, it connected over 500 million Indians and changed the dimensions and fortunes of the entire mobile telecommunication industry.
Anger, usually, has negative connotations but if channelised correctly, it can produce miraculous results. Martin Luther King’s anger against discrimination changed the social fabric of the most powerful country in the world. Steve Jobs’ anger against the mediocre and dull created the apple way to live.
3. Risk and Change
“If you don’t like change, you are going to like irrelevance even less” remarked General Shinskei.
Western global corporations enjoyed the benefit of starting early. It was easier to access markets and consumers, cheaper to hold on to them with fewer competitors to lure them. Today, the context is radically different. Leadership is easy to achieve but difficult to sustain. The environment is hyper dynamic, and the consumer is ever changing. Every change closes some doors but opens several others. Hence, we need to validate assumptions and modify our plans real time. The ability to understand and embrace risk is critical to thrive.
In a world driven by consumption and ownership this is a significant departure from the norm. We should think of ourselves as trustees of our stakeholders – customers, investors, vendors, employees. This will inspire us to be disciplined in decision making and execution. Blessed with this responsibility, we will take decisions which are in the long-term interest of the stakeholders. This will help us keep our ego in check, care for the assets entrusted to us and deliver superior business results.
I strongly believe that these four principles will be the bedrock of the visionary Indian leadership brand. Slowly, steadily, surely!
The author, Ajay Piramal is the Chairman of Piramal Enterprises Limited.
The true purpose of health-care reform, to control costs, will require a Herculean effort put forth by a committed leadership team
By Nikos Mourkogiannis
My Google alerts on the use of the word “purpose” increased dramatically once health-care reform captured the headlines. And in reading those alerts, I was fascinated to see how the thinking on the subject evolved.
Everyone seemed to agree that the health-care system would be shaped by the purpose that it would serve. Where the disagreement occurred was over what the purpose in fact was, with people divided by ideology. Some thought the U.S. should be true to its heritage of discovery and innovation and develop a new system of health care. There were those who spoke of extending to the entire population the excellent coverage that a lucky fraction of Americans have. Yet others saw this as an opportunity for altruism and wanted to guarantee for all the right to health care.
Eventually, however, as often happens when people master the courage to talk candidly about purpose, consensus was achieved. The purpose of health-care reform is not discovery or excellence or altruism. It is to control costs. And it will take heroism—a Herculean effort to bend the cost curve. That’s why the responsibility has not fallen to the House and Senate committees that supervise health care but to those that control the purse strings.
More Than Universal Coverage
In actuality, the politicians know that merely extending coverage to all Americans is easy. That does not require reform; it can be accomplished by legislation. But their mission is to come up with options on who pays and how much, so that specific minimum benefits are affordable to the average American.
And while the purpose is now clear, how it gets achieved—the strategy by which it gets accomplished—is less so. As is often the case with strategy, especially when a low-cost solution is required, it will come down to numbers. In this sense, matters of public policy are no different than corporate ones, except that politicians must worry about polls and voters, while executives have to worry about stock prices and shareholders (at least at publicly traded companies). In both cases, leaders have to align two sets of numbers: the cost of what they want to do and what the market (i.e., voters or shareholders) will bear.
There is no doubt that politicians are aligning the numbers—at least on paper—and that we will have a health-care bill in the fall. And then the real leadership challenges will emerge: The numbers will have to be aligned in a practical, workaday manner by the leadership team that will manage the health-care system. That team needs to be focused on strategy while never losing sight of its real purpose.
The success of this leadership team—which has yet to be formed—will greatly depend on how well it does this. The temptation to burden the new health-care system with objectives that don’t fit its purpose will be great. People will keep asking for incentives for healthy lifestyles, for the elimination of disparities, for more innovation, and the like.
It will take enormous courage for the members of the team to keep reminding us that the key to cost control is standardization and that choice, innovation, and high-quality service are incompatible with the effort to keep costs down for the average American. Absent the courage to be single-minded, the team will fail.
Yet courage will not be enough to ensure success. The challenges for the leadership team that will manage the system will extend to resolving issues related to organizational design, people, compensation, control systems, and, most important, values that will need to be both espoused and practiced, all while keeping purpose uppermost in their minds.
If the team members are not aligned to the purpose, the reform will not work. The bill will pass, but eventually we will have another unsuccessful health-care system on our hands. The obstacles are many, and they include our own prejudices. Here are the 10 most important obstacles:
• Large systems, like the health-care system we want to build, require hierarchies and bureaucracies. We despise these two words. However, we do not really know how to manage scale without these two things while keeping costs down. If we try to manage the system just through the market, as advocated by many, costs will increase. Markets are good for setting prices, not so good at keeping them down.
• A lot of discussion to date has been focused on the insurance companies. However, if one wants to control costs, all suppliers in the health-care system have to fall in line. This includes doctors and hospitals, two factions that have considerable influence in the U.S.
• A lot of suggestions have been made on how to control costs through information technology. There is no question that our hospitals are paper factories and that 30% of all health-care costs are administrative. However, to expect technology to solve the problem on its own is a folly. Taking costs out of they system will only happen when difficult decisions, each of which is bound to upset some faction, are made.
• Controlling costs often entails challenging cherished beliefs and eliminating long-held practices. Because of the belief that life itself is priceless, many will oppose the rationing of access to care and a system that makes only some medications available or limits medications to certain group.
• Doctors will oppose a compensation system that is not based on hours spent or procedures performed, although there has never been a large, low-cost system that has paid doctors in any way other than by salary.
• Insurance companies will merge or band together to increase their power to negotiate higher premiums. As a nation we need to think hard about the structure of this industry. Especially now that we know (after the AIG experience) what happens to the insurer of last resort.
• Pharmaceutical companies will innovate and will dare the system not to pay the bill. Resisting the new in favor of the old and tried is not easy. For some this is also un-American. Our love of the new will make it too easy for us just to cave in and pay the high prices the pharmaceutical companies will demand.
• We will need a pipeline of warriors who are prepared to fight a never-ending war against health-care costs. While those who want to be warriors usually have other career paths in mind, they are the kind of people we need in politics, in management, in contract negotiations, and procurement for the new system to work.
• A lot of people entered the health-care industry because they want to help others, and they are rightly proud of having compassion as one of their core values. Yet other values are needed as well, especially consistency and discipline. They are not prevalent in our health-care system yet will be essential to serving the purpose of making health care affordable to the average American. We all recognize the value of the doctor’s intuition and the nurse’s compassion. Yet lack of discipline in observing evidence-based procedures for four common conditions is associated with a lot of recurring costs—let alone hundreds of thousands of deaths each year.
• The ultimate challenge will be introducing a culture of performance and accountability to the new system. Health care, unlike health or wellness, is subject to easy benchmarking. Our new system will be very comparable to universal coverage systems already in place in Europe and in countries whose per capita incomes and demographics are comparable to the U.S.’s. The leadership team that will manage the U.S. system must, therefore, assume the responsibility to give the American public a system that delivers the same benefits and at lower cost. For when it comes to cost, the scale of our system must work to our advantage.
The health-care system that will emerge in the next few years will change the U.S. forever. It will be as big as the entire British economy. And to take this step into the future, the U.S. has to look to its past. The country has seemingly forgotten how to produce on a massive scale and at low cost. The greatest achievement of this type is still Henry Ford’s Model T.
If we allow ourselves the folly of believing that the purpose of health-care reform is something other than Model T coverage—basic, no frills, and widely affordable—then either universal coverage will not be achieved or we will go bankrupt.
- The True Purpose of the Board
- Purpose: The Search for Strategic Alignment
- The Return in HR from Purpose
- Purpose-Led Planning & Strategy Execution
- An Interview with Nikos
- Using Purpose to Drive Innovation
- Thinking on Purpose
- Purpose: The Starting Point of Great Leadership
- The Search for Purpose
- Four Routes to Success
- Purposeful Leadership