Paradigm Shifts

From Profit to Purpose

It was an ordinary day, just like any other. Suddenly, we woke up to see that Milton Friedman made headlines in the New York Times, saying that an organization’s sole social responsibility is to make profit.

The funny part is – it’s been 50 years, and we still somehow believe in this.

For years, starting with this doctrine, it’s been known as a fact that an organizations’ main purpose and reason for existence is to maximize profit and increase their shareholder value. These define an organization’s “success.” That is just the way it is.

But we’re skipping a tiny detail that changes everything: maximizing shareholder value does not equal success anymore. This mindset puts organizations in a finite, competition-driven endless cycle, which is not relevant or sustainable – and those who are focusing on only this today are under significant risk.

This manifesto that organizations have been living by has failed, and today we are finally revisiting this idea. As the Davos 2020 Manifesto also states, we are now in the age of Stakeholder Capitalism.

Just like humans, organizations now are facing an existential crisis – their search for purpose.

People are looking for organizations that hold meaning and create value for all of their stakeholders. To thrive, organizations must unite around a shared purpose as a guiding mechanism and make a meaningful impact for all.

Our question to you is, what is the change you want to create, and how does it relate to your organization’s purpose?

From Numbers to Human Insights

When we think of data, what do we visualize?

Numbers, excel sheets, graphs, or even impressive analytic charts if we’re feeling fancy. We know that stats and analytics may back up real outcomes; that’s what makes them real.

But be careful, believing in numbers might be dangerous and misleading.

We have become obsessed with numbers and can’t resist the comfort in it – because the truth is, believing in numbers is easy, and the contrary takes effort. Organizations have fallen into a rabbit hole and blinded themselves with numbers, so much so that they can’t seem to see anything beyond.

To put it simply, ‘maths’ is just not enough anymore.

Numbers are great, yes, but taking numbers alone does not show fundamental reasons: the ‘whys’ behind people’s actions, thoughts, and feelings. So what is it leading us to?

Organizations don’t realize that “78% of people need…” doesn’t tell us everything. Taking a close look, we don’t know the ‘why’ behind this “78%”, do we? Their aspirations, motivations, pain points. Even worse, asking about the “22%” hidden underneath does not even cross our minds.

Boiling down people’s behavior and experiences into percentages and diagrams only pushes organizations away from the human and stops them from uncovering the truth. Organizations must understand who these people are as humans first if they want to create real value and real connections – which everyone claims to be asking for recently.

Our question to you is, have you ever wondered what treasure might lie under your numerical data?

From Management to Leadership 

A leader by its textbook definition is: “someone who leads or commands a group, organization, or country.” So who do we picture when we hear this definition? 

Someone with probably ‘x’ years of experience in the field, has a polished resume, is given the authority to delegate work, and knows how to get the job done- and therefore is a good manager, right?

There’s just one problem here, though; leadership does not mean management. 

The definition of leadership has changed.

Today, surveys show only 20% of millennials aspire to be managers, but most of them aim to be leaders. So what do the millenials see that we don’t?

They’ve realized that in the era we live in, being the CEO on the organizational chart would not make them the leader of that organization.

Leadership is not about pushing your employees to achieve your targets; a leader by today’s definition guides and supports their peers to unlock their full potential, someone who works to empower their employees’ and stakeholders’ sense of agency, adaptability, and agility.

Yes, a leader’s performance is measured by the success of their employees, but how they define this success is what must change. If organizations want to thrive, their perspective on leadership has to shift, and it has to shift fast. 

Our question to you is, would you call yourself a leader or a manager? 

From KPI’s to Multi-Dimensional Success

‘You can’t manage what you can’t measure’. You’ve probably heard this version of Peter Drucker’s saying -or any other famous quote that stresses the importance of focusing on measurements- time after time.

What we measure shapes who we are, and it is essential to discuss why we measure it.  

As long as our measurements meet the numbers they are supposed to meet, we are OK, and we consider ourselves successful. Sell this much of a unit, reach more customers than a year before. And as a result, any means to achieve these targets become justified. 

This dilemma makes us forget what real success is, and the measurement as a tool becomes the purpose itself.

Success in its true nature is multi-dimensional. It is when your products and services make sure that your customers are doing well. The people you touch are better off because your actions are in service to your purpose. In short, all of your stakeholders are successful since you ‘exist.’ 

When your measurement is genuinely aligned with your purpose, you are in an existential transcendence mode, rather than an existential crisis. And this measurement needs more dimensions, not more KPI’s.

Our question to you is, how do you measure success in your organization, and does it make sense to you? 

From Diagnostic to Dialogic

We are inundated with organizational transformation projects. Yet, according to a recent study, people hypothesize that 70% of organizational-change initiatives would most likely fail.

The reason behind this popular perception is the way we approach change. It is fundamentally wrong. We try to change the organization like a machine as if it can be engineered to “the optimum” through an objective truth or a single point of reality. That is not the case.

Change cannot be realized with diagnosis and prescriptions. To change what we need is dialogue. 

Diagnosis is about fixing anomalies. Dialogue is a way of living and a continuous process where humans evolve and organize.

Diagnosis acts in a cascade with an agenda formed by the top to teach the bottom what to think. Dialogue is about constructing the normality in where we think, live, and exist. 

Diagnosis is reactive. Dialogue creates an authentic, transformational change that is proactive.

Suppose you think about it in a broader context and look back at ‘any’ organization in the history of humankind. In that case, you will notice that change occurs when there is collective action with bold ideas and new perspectives. 

Organizations are the ultimate meaning-making systems, and meaningful change will only happen when people can change what they think to change what they do.

Our question to you is, do you need to change because you have diagnosed the problems or because your dialogue pushes you forward?

From answers to questions

Would you be willing to ask a question freely if you were a soldier during World War 2? Not likely. After the end of the war, military structures were modeled for any organization and became the standard. And just like the military structures they were modeled after, there was no need for an inquiry.

Post-war organizational structures were a place where people demanded answers. It was a “pro-answer” culture, where the more you know, the better, and there was no time for questions. We still live in those post-war organizational structures today, but a lot has changed in the last 20 years. 

As Paul B. Buttino, Director of Technology & Entrepreneurship Center at Harvard, says, ‘Knowledge has become a commodity.’ We now live in a world where there is constant disruption and increase complexity with easy access to information. Right now, expertise is not about what you know but what you can learn. And the core skill for this new normal has become asking the right questions.

We need questions that spark our curiosity and make us discover new insights, learn new things, and improve ourselves. 

Simply put, questions have become the capital for innovation. And the future belongs to organizations that can ask the right questions that spark creativity and collaboration.

Our question to you is, how can you ask better questions so that your innovation capital increases?