In a world where many developed economies are facing declining populations and technology is disrupting how work gets done, the nature and needs of companies are changing. Talent is the last competitive advantage and, with the unemployment rate in Hong Kong below three percent, competition for it is fierce. What can you do entice the best and brightest?
By Diana Wu David, author of Future Proof
Many companies adopt the idea of “purpose” to boost employee engagement. Gallup Research polls show only thirteen percent of teams are actively committed to their work. Millennials applicants ask about company values before querying about the company cafeteria. It is an easy sell to the board and C-suite. So, companies hurry to plant trees in Brazil to offset carbon or ban meat from the pantry to boost their ranking as a ‘best place to work’.
You may be wasting your time. Purpose, by itself, doesn’t matter to your people. Superficial purpose-washing that does not go further than the recruitment brochure is not enough. The challenge is to make it material and to create shared value.
The carrot and the…burning platform
It is important to have an organizational purpose meaningful and relevant enough that people across the business use it to make business decisions and to create new value.
When I worked for Financial Times, the shared purpose was to provide information to business and government leaders that could help them make better decisions. The shared imperative: transitioning to digital in order to ensure our survival in a new economy. Similarly, Philip Morris International is a company many would be reluctant to include in a list of shared value champions. However, as their business transitions from cigarettes to electronic devices, they have the opportunity to profit from a shift that will ultimately be better for customers health. This urgency based on survival or “the burning platform” gives people across your organization a sense of purpose and urgency.
Purpose helps you see around corners
The average company lifespan of an S&P 500 company has reduced from sixty years to twelve. In a world of increasing volatility and uncertainty, all companies need to have both urgency and foresight.
Risk aversion does not reduce risk. Agility and preparation allow companies to take the right risks to future-proof and stay relevant. Purpose helps you see around corners by focusing on problems to solve, not just on your traditional competitors.
Alphabet is a large behemoth but they invest in new tech to ensure that they can stay at the forefront of business. While Google’s initial purpose “to organize the world’s information” wouldn’t seem to relate to driveless cars, it is now lagging behind Tesla in the battle to obtain feedback data from autonomous vehicles that will allow better automation.
Collective ambition brings people together
Meaningful relationships are a huge driver at work and in life. Meaningful work, knowing that you are contributing to make things happen and make a positive aspect is key. It provides a collective ambition across the organization that pulls people together. This can break down silos and engender innovation as each team or department considers how to solve a problem larger than themselves. Alignment with global goals such as the United Nations Sustainable Development Goals often makes this an even broader.
Talent, combined with focus, is the last competitive advantage.
In a future where automation quickly becomes a commodity, people, creativity and ideas are your edge. Strategy professor, Rita McGrath, calls human talent one of the last competitive advantages a company can create. Without a business centered around creating value and a broader impact on society, companies may lose their north star, reacting to lagging indicators like annual budget reviews while neglecting the inputs that will put them on the path from good to great or even from a sure death to survival. Call it purpose, shared value or conscious capitalism, values-based leadership is the competitive edge of the future.
Original article appeared as a guest post on Shared Value Project HK.