As far as management buzzwords go, ‘purpose’ certainly seems to have gained a lot of recent popularity. But what is this ‘purpose’, and does having a one actually make employees happier, teams more effective, or companies more societally aware? Rotterdam School of Management, Erasmus University (RSM) dedicated this year’s Leadership Summit – the school’s largest event – to answering these questions. Two CEOs, a famous lingerie designer and a champion surfer, joined in on the discussion.
Michiel Muller, CEO of the online supermarket Picnic, kicked off the day by saying that if you want to attract high-potential millennials Your company must have a purpose. But does ‘having a purpose’ come down to simply being passionate about the direction of the organisation? Daan Stam, assistant professor at RSM, says research suggests that having passion and idealism in fact does not improve a company’s performance. However, communicating that employees have a responsibility certainly does. In times of crisis, communicating ideals may be very effective: individual employees may respond well and become more motivated, especially after a grand display by management that emphasises the importance of having ideals.
Managers can create purpose and draft mission statements as much as they you want, he continues, but at the end people must find their own purpose. To make that happen, his research suggests, you need to talk about purpose not just at the outset. As a manager, you must make sure to continue repeating the message. Secondly, he argues, managers should not make their ‘purpose’ about themselves – or their plans – but about the employees. Go out and ask what it means to them. Ideally, finding purpose is a process of co-creation, he states.
Continuity
But what if employees still resist the purposeful new mission statement? Stam says the reason people reject a ‘purpose’ is not because they do not care about the company. In fact, people often resist change because they care too much. To overcome this, he advises leaders to not only communicate change and freshly-minted purposes, but to also emphasise continuity: stress that the newfound ‘purpose’ will not translate into total change.
A student in the audience remarks that young people these days are brought up and educated with the idea of having to have a purpose, so employees must expect them to come looking for it when they show up for their first jobs.
'Ask yourself why three times'
One such student, Steffie Broere, now works for Extraordinary Life, founded by RSM alumnus Sam Marshall. Extraordinary Life provides workshops and coaching aimed at helping students to develop their purpose. She has some advice for students looking for purpose: 'Think about something you like, then ask yourself ‘why’ three times. For example, why do you like to run? The first answer is that you want to become fit. Why do you want that? Well, so you can grow old comfortably. Finally, why is that? It could be that you value your family and want to enjoy your activities together for as long as you can. That is a purpose right there!'
Lingerie
During her talk, lingerie designer Marlies Dekkers states that being young may not always be an advantage when you’re trying to find your passion. She talks about how it took her some time to discover her passion and purpose: challenging other women in finding their dream. She found that her designer lingerie helps women to think of themselves as desirable and beautiful, and thereby develop self-confidence. Which, she argues, is needed when trying to find purpose. In this way her lingerie became not just a successful business, but also helped shaping the third feminist wave, she says.
Purpose in crisis
Alumnus Vincent van den Boogerd, CEO of ING in the Netherlands, then takes to the stage to talk about how purpose can help a company navigate a corporate crisis, much like the one the bank has recently found itself in. He explains how the bank’s management – especially now – communicates to their employees that despite bad PR, the company is still firmly committed to its purpose of financially empowering people. He describes how improving their mobile app has inspired clients to take charge of their finances and reduce stress by giving them insight into their savings and spending habits: what does my latte macchiato a day actually cost me per month?
Three years ago the company decided to split up big departments in smaller autonomous teams that can define their own purpose. They did this in order to make ING employees really feel the company’s purpose of financial empowerment. The bank has quite some challenges ahead, Van den Boogerd admits, but he hopes the improved agility prepares them for a future where need for banking stays, but banks themselves may become superfluous.
RSM Professor Michaéla Schippers asks Van den Boogerd how he plans to make the company a psychologically safe space for people to speak out against the company without fear of retribution by management. He replies that the company currently evaluates employees on their efforts to help others, and measures how engaged they are. And did raising the salary of the company’s CEO earlier this year fit this new purposefulness, another audience member asked? Van den Boogaard answers that the bank’s purpose does not hinge on one person’s salary.
Surfing
And finally: how does surfing fit into this? Professional surfer and former world-champion Shaun Tomson closed the day by telling the audience about how one of his favourite Californian surf spots was once threatened by a plan to build oil tanks, right next to the shore. This inspired him to become an environmental activist. To inspire others to join in on the action, he wrote his ‘Surfer’s Code’: 12 surfing-inspired rules on how to live a good life, such as ‘I will never turn my back to the ocean’, a rule that stands for passion. The Surfer’s Code became a cultural phenomenon, and in the process gave Tomson his own purpose: to help others find their goals in life. How? By creating statements starting with ‘I will’. Because that’s how it goes, he closes the day on a hopeful note: you either find purpose, or purpose finds you.
