The Golden Circle and its Importance to Business Success.
How do some organisations achieve & sustain success for years on end while inspiring loyalty and engagement among their customers and employees alike?
Most successful organisations act and communicate in ways that are completely different to everyone else. They put their Why (their Purpose & Values) at the centre of everything that they do.
Very few organisations understand Why they do what they do, let alone live by it. This provides organisations who commit to discovering and then living their Purpose a real opportunity to develop a strong competitive advantage.
This article discusses the ‘Golden Circle’ and explains how focusing on the organisation’s Purpose & Values (its Why) helps it to succeed. It is explained very well in a video by Simon Sinek “How Great Leaders Inspire Action”.
We have a great deal of experience in using this process to help organisations and individuals to discover their Purpose and Values. We understand the nuances of the process and, therefore, not only how to find their purpose but also communicate it both internally and externally. In addition we help organisations to embed it in the culture of the organisation.
The main elements of the Golden Circle
The following describes the how the key elements of the golden circle and how the fit together.
Every organisation and individual knows What they do – the products the sell or services they provide.
Some organisations know How they do what they do. These are the things that make them special or different and set them apart from their competition. This is often called the unique selling proposition (USP).
The Why is the organisation’s purpose – its reason for being and its core beliefs and values. It provides clear answers to the questions “Why does your organisation exist?” and “Why should that matter to anyone else?”.
It is important to note that the Organisation’s Purpose cannot be “to make money”. Revenues, profits, salaries and other monetary measurements are simply the results of what the organisation does. An organisation’s Purpose is the contribution it makes, as well as its core values and guiding principles. It is about the way it makes the people it comes into contact with feel.
The way most organisations communicate
As shown in the diagram, people and organisations naturally communicate from the What to How and occasionally to Why. This is because What is the easiest to understand and explain.
Typically people and organisations communicate this way. They tell people What they do and sometimes How they are different or better. They rarely say Why they do what they do.
Here is how most organisations market and communicate:
What: “We are a legal firm specialising in all aspects of corporate law.”
How: “We have experts in the field with extensive knowledge and experience gained for working with businesses across a wide variety of industries and markets.”
Expected Behaviour: “Hire us!”
Change the way we communicate
The problem with communicating from the outside in is that What and How do not inspire the desired behaviour.
While facts and figures may make rational sense, people make decisions based on emotion – what feels right to them. This means that organisations need change the way that they communicate, both internally and externally.
Starting with Why and working outwards, as shown in the diagram on the right, will drive decision-making and behaviour. This is because communicating in this way literally ‘talks’ to the part of the brain that influences behaviour.
Here’s an example with the same legal firm discussed above but this time starting with their Why:
Why: “We are passionate about providing practical legal and commercial solutions that help people achieve their business and personal goals.”
How: “Our lawyers are experts in their field, easy to deal with. They are committed to helping our clients achieve the best results for them. If we can’t help solve your issue, we will introduce you to someone who can.”
What: “Our legal firm specialises in all aspects of corporate law. We always provide practical, solution driven advice to our clients.”
Expected Behaviour: “Prospective clients will want to work with us. Existing clients will be loyal and will be our best advocates”
“People don’t buy what you do, they buy why you do it” Simon Sinek
When an organisation has a Purpose that all of its people truly believe in, they think, act and communicate differently. Purpose-driven organisations will attract people who believe what they believe and who want to be a part of their ’cause’. This is not restricted to employees. It includes customers, investors, suppliers and other stakeholders associated with the organisation.
Having a purpose supported by strong values is a very powerful tool when it is communicated in the correct way – starting with Why.