How to Inspire Transformation and Innovation

How do workers respond when they hear the announcement of a restructuring initiative (or any other major transformational effort for that matter) designed to “grow revenues through better innovation” or “cut costs by trimming the workforce” or “shuttering manufacturing plants to generate cash for reinvestment” or refocus on “creating value” by outsourcing “non-core” parts of the business? Applause and cheers for the executive team? Spontaneous office celebrations? Do employees say to themselves “Finally. Now I can really put my heart into my work”?

Or do people shut down, become less innovative, and begin freshening up their resumes?

Why in the world, after so many years of business history, so many restructuring initiatives that fail to deliver on the promises, and such an obvious understanding of the effect on human behaviors, do we keep going about it the same old way?

Time to think about it differently. And let’s start with the first of the ThinkPoints™ that has to change to be successful: Purpose.

We can all probably agree that sometimes businesses get in a position where they have to engage in the unpleasant task of eliminating jobs and cutting costs. But who, besides senior executives or owners, buys in to the purpose of a transformation because of the impact on the P&L or balance sheet? Answer: virtually nobody.

So, the first step in a successful transformation is to define a purpose that can actually inspire the new behaviors a company wants in the future. And that starts with a senior leader intervention that has them articulate purpose outside of themselves and in terms of the benefits the business provides to the consumers it serves.

To do this, the for-profit world can take a tip from the non-profit world. For example, International Justice Mission has this for its purpose: “Rescue thousands. Protect millions, Prove that justice for the poor is possible.” With a purpose like this, most employees would do whatever they can to change or transform in order preserve the organization and its purpose.

Applying this to the for-profit world means businesses have to think beyond themselves and understand how their value proposition profoundly affects their customers. So, a toy company is better served by “inspiring imaginations and happiness in children around the world” than they are “increasing shareholder value”.

Just articulating a purpose isn’t enough though. Most businesses aren’t in the least transformed by crafting a statement just so they can check it off their to-do list (which is what most of them have done with mission, vision, or values statements). Senior execs themselves need to be transformed by the purpose. Their most difficult transformation is to begin leading through purpose rather than through financials. Leadership through purpose opens up brand new ways to think about the business and inspires far more innovation and discretionary effort. Thinking “how can we inspire imaginations and happiness in children” is profoundly different from “how can we sell more of product x to grow revenues.”

When senior leaders begin their personal transformation journey, they not only open up new ways to think about their business, they in turn begin the transformation process for their employees. Purpose provides the basis for magnanimity, the ability to inspire greatness in others; an essential quality in leadership. A higher purpose, purpose beyond the P&L statement or balance sheet, inspires innovation and discretionary effort. Purpose inspires transformation.