By Sarah Rozenthuler & Edward L. Rowland
Originally published on LinkedIn, Oct 14, 2015
“Leadership is discovering the company’s destiny and having the courage to follow it… Companies that endure have a noble purpose” Joe Jaworski
Co-creating purposeful organisations is a new frontier in organisational development. This post taps into the growing body of evidence about the financial, social and psychological benefits of creating “cultures of purpose.” It explores how leaders can attune their organisation to a rapidly shifting global marketplace and catalyse purposeful action by developing four core capacities of “systemic leadership.”
Leadership, always a hot topic, has been in the spotlight more than ever in the UK in recent weeks. With the Volkswagen emissions ‘scandal’, Labour leadership contest and refugee crisis, we observe that much of our media remains in thrall to the myth that leadership is simply about individuals or the ‘person at the top’.
The leadership challenges of today, however, are far too complex for any one person to solve by thinking and acting alone. They require diverse stakeholders to think, talk and co-create together in unprecedented ways. Leading in a volatile, uncertain and ambiguous environment, whether this is in an organisation, a political party or a union of nation states, is less about individual heroics and more about mobilising collective potential.
Leaders who can catalyse a ‘flow’ of leadership and purposeful action across a whole system are more likely to contribute to sustainable results. Below we outline — from our perspective as practitioners — four core capacities that will help leaders to demonstrate this ‘systemic leadership’. We will begin, however, by highlighting the newly emerging evidence that shows how aligning a system around a vibrant and noble purpose is core to its success.
The power of purpose
There is a growing business case that demonstrates how companies with a clear and resonant corporate purpose have several distinct advantages. Recent research by global consulting firm EY and IMD, a leading international business school, has found that purposeful organisations are able to:
- Build trust more easily with their employees, shareholders and customers as their purpose guides principled decision-making.
- Combat consumer concerns more readily and create brand advocates more widely through positive comments aligned with corporate purpose.
- Generate competitive advantage more distinctly, estimated to be an increase of 17% of financial performance, due to enhanced reputation in the marketplace.
- Demonstrate greater resilience by being better able to weather the storms of change such as shifts in consumer opinion, downturns in reputation and challenges to leadership.
To harvest these benefits, ‘purpose-beyond-profits’ (as it is sometimes called) must be the central driver of an organisation’s strategy, not an optional ‘bolt-on’. It needs to be strong enough that it becomes part of the organisation’s operating model and inspiring enough that it unleashes people’s energy.
As examples of what this can look like, Frederic Laloux’s Reinventing Organizations researches 12 successful, pioneering organisations which operate – in his view – from a largely ‘teal’ level of consciousness and culture (in the developmental language of Integral Theory). For these organisations, purpose is not only an energetic wellspring that inspires and shapes direction. It also informs and transforms many business practices; strategy formation, product development, marketing, targets and budget setting, and recruitment.
Systemic leadership – Four core capacities
In our collaboration and consulting work together, we have identified four core capacities of systemic leadership that will change the game. We have drawn on over thirty year’s combined experience, our respective expertise in cutting-edge practices such as Systemic Coaching and Constellations, Dialogue and deep inquiry, as well as leading theoretical frames such as Otto Scharmer’s Theory U.
When a critical mass of leaders embody these capabilities they will seed a new culture of purpose characterised by unified action, renewed energy and collaboration across boundaries. The four core capacities are:
1. Creating “containers” for generative dialogue
To create a future that is different from the past, leaders need to step into unknown territory. This calls for a diverse constellation of stakeholders to sense into the future that wants to emerge. This requires building “containers” or holding environments for courageous conversations where all the different voices matter.
2. Seeing the larger system
To build a shared understanding of a complex problem, leaders need to extend their awareness beyond the boundaries of their individual role, team or organisation. Seeing reality through the eyes of people in very different positions from their own helps leaders to generate new insights. When leaders take into account the hidden dynamics that operate beneath the surface of day-to-day interactions, they become more skilful at intervening.
3. Attuning to higher potential
When leaders attune their teams, functions and projects to the real reason for an organisation’s existence, this unlocks great potential for innovation and energy to achieve excellence. In our work we have seen how a noble purpose acts like a “magnet” that brings alignment to a system that has become fragmented. Instead of people pointing in many different directions, there is greater coherence in the decisions people make and the actions that they take.
4. Co-creating a new reality
Shifting from reactive problem solving to listening for what wants to emerge calls for an expanded capacity for collaboration. Embedding systemic change involves an ecosystem of stakeholders — customers, suppliers, partners and employees — coming together to co-create solutions. Somewhat paradoxically, this more collective and fluid approach calls for a clearer flow of leadership than in “command-and-control” cultures so that each person feels authorised to take purposeful action.
In future posts, we will look in more detail at each of these core capacities for activating systemic leadership. We will provide examples from our consulting about how they can be developed in practice to strengthen a workforce, generate long-term growth and build cultures of purpose.
Please note that we are running a 3-day intensive, The Purpose Programme: Developing Systemic Leadership on November 24-26th in London. The programme helps participants develop the systemic leadership capacities to create cultures of purpose. Click here:
Frederic Laloux, Reinventing Organizations (2014) Nelson Parker