Personal View

Make Every Employee a Chief Purpose Officer

Personal View

CVS Health famously dropped tobacco sales—even though the move was estimated to cost them $2 billion annually in revenue—because it conflicted with their established principles. That is unmistakable commitment to company purpose.

Does purpose matter? Some say it works, others suggest it’s tricky and flawed. Who’s right?

Enter important new research, released last summer, which shows that companies that instill a sense of purpose reap meaningful financial benefits. “Ultimately, our study suggests that purpose does, in fact, matter,” write two of the study’s co-authors, George Serafeim and Claudine Gartenberg, in the Harvard Business Review.

But the researchers have a warning: It’s easy to mess up.

“It only matters,” they explain, “if it is implemented in conjunction with clear, concise direction from top management and in such a way that the middle layer within the firm is fully bought in.”

Instilling a greater sense of purpose in our organizations—not just at companies but also at big institutions like Berkeley-Haas—has been an increasingly important goal for business leaders over the past few years. Public discussions about corporate and organizational purpose have increased fivefold since 1994, according to Oxford University and Ernst and Young. Most millennials (87 percent, in fact) believe “the success of a business should be measured in terms of more than just its financial performance.” And 47 percent of consumers buy from companies that boast a purposeful brand.

But it’s tough to scale purpose.

To distill purpose more equally throughout the company, many firms are considering hiring chief purpose officers. Shannon Schuyler, newly hired first chief purpose officer at PricewaterhouseCoopers, defines the role as, “how you connect purpose to an individual so they know what they need to do in their roles and how you help them see personally how they connect with values and behaviors.”

Given what the latest research says, this may not go far enough. It is important for each and every employee to be trained for this mindset. By helping every employee see that at least part of their job is chief purpose officer, we can further break down the wall between rhetoric and action. Part of being a chief purpose officer, then, is pulling out the meaning and benefit from any business and connecting your people more directly to that, regardless of whatever (perhaps narrow) slice of the business occupies most of their time. Importantly, this includes even everyday things that we too often overlook, like creating jobs, or serving customers profoundly well. When your people can see themselves in this role, it is, in effect, a shift in identity.

An interesting thing happened to me when I became dean. Board member Margo Alexander, BS 68, the retired chair and CEO of UBS Global Asset Management, told me that I was the chief purpose officer. This was news to me. (My background is in economics and finance.) Once I got over that initial bewilderment, I realized this kind of thinking makes me better at motivating and connecting our people and pushes tangible outcomes like innovative and collaborative thinking. And now, every fall, I tell all our incoming students that chief purpose officer will be part of their jobs as well—instilling a larger sense of purpose in the people around them. As one more example of my own behavior change, I regularly share more widely emails that I receive from people we serve that hammer home why we do what we do, and why it matters. Like Simon Sinek’s concentric circles, we should be going after the “why” just as carefully as we go after the “what” and “how.”

I was 45 when I became dean—I wish someone had told me beforehand that this is part of what “leading” and motivating people is about. Early in our careers most of us think of ourselves first as individual contributors. At some point many people begin to realize that their most important work will get done by working through and with other people. If your company can play a role in making this transition happen sooner, coupled with responsibility for instilling a greater sense of purpose in others, you will benefit from the ripple effect.

Give your new hires greater opportunity to understand the width of your company’s purpose and why working together has meaning. Don’t assume that this will automatically be communicated by simply reading your stated vision, mission, and values. Set expectations—and give them regular opportunities to flex their own purpose-officer muscles with their own direct reports and teams. Define what specific actions work best for your company along these lines and measure whether they are practiced at multiple levels.

Talk about purpose adds little without clarity on the deeds and roles that back it up.

A slightly different version of this article originally appeared on Forbes.com.

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In addition to leading Berkeley-Haas, Dean Rich Lyons, BS 82, has been exploring how business leadership drives innovation, specifically how values-based leadership can transform an organization, create competitive advantage in a crowded marketplace, and provide a sense of purpose at every level of the organization. He began writing a monthly column for Forbes.com in the spring.


Dean Rich Lyons, BS 82