Purpose oriented leadership gives employees a reason to be engaged

purpose oriented leadershipPerforming tasks to order is not enough to motivate 21st Century employees and instead they need purpose oriented leadership to understand the “why” of their organisation.

The purpose needs to be defined and made meaningful in a way that simply stating “making a profit” or “increasing sales” do not.

Generally, workers will perform more effectively if they believe in what their company is doing and how it is contributing to the common social good. This has been described as having a higher-oriented purpose. 

But this means that the most successful leaders need to be able to communicate their vision and to have good narrative skills in order to do so.

Amazon founder and CEO Jeff Bezos, for example, has banned PowerPoint in executive meetings. Instead, he believes that “narrative structure” is more effective because human brains are wired to respond to storytelling.

good example of effective purpose oriented leadership is Gerry Anderson the president of Detroit-based DTE Energy, which supplies electricity and gas to South Michigan customers.

An article in the Harvard Business Review describes how, after the 2008 Financial Meltdown, Anderson realised that DTE employees were not very engaged and could not seem to break away from tired, old behaviours.

He commissioned a video that “showed DTE’s truck drivers, plant operators, corporate leaders, and many others doing their job and described the impact of their work on the well-being of the community — such as on factory workers, teachers, and doctors who needed the energy DTE generated”.

These stories effectively demonstrated DTE’s statement of purpose: “We serve with our energy, the lifeblood of communities and the engine of progress.”

Purpose oriented leadership is becoming ever more crucial for engaging employees in 21st Century business.

A PwC study reported in Forbes magazine in 2018 revealed that millennials who have a strong connection to the purpose of their organization are 5.3 times more likely to stay but only 33% of employees drew real meaning from their employer’s purpose.

Similarly, new data collected by PR Week shows that customers view purpose-driven brands as being more caring and, as a result, are more loyal to them. It reported that 67% of respondents said they feel companies with a purpose care more about them and their families and ~80% of respondents said they’re more loyal to purpose brands, while 73% said they would defend them.

I have mentioned in previous blogs that there is a growing shift, among investors, consumers and employees, towards more ethical businesses, partly, but not only, down to the rising concern about climate change.

Clearly, business leaders are going to have to think more deeply about the purpose and goals of their organisations and to define them more specifically. They also need to communicate the purpose and goals if they are to survive since this involves nurturing loyal employees and customers.

 

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