Profiting from purpose

Deep Purpose: The Heart & Soul of High Performance Companies

Author: Ranjay Gulati

Publisher: Penguin

Pages: 304

Price: Rs 1,799

Ranjay Gulati is one of the most distinguished professors at Harvard Business School who has done remarkable work on the intersection of leadership, organisational design, and human behaviour. Deep Purpose delves deep into architecture of purpose, to examine what sets apart high-performance companies from the rest of the crowd. It is hard to research intangible values such as character, culture, ambition, judgment, and a host of others that we find tough to describe even in an ordinary conversation. This book is a fascinating journey through one such indescribable yet pivotal value: Purpose. All leaders chase obedience to visible and enforceable values, but what about obedience to those that are unseen and the unenforceable yet pivotal? Dr Gulati helps us understand this better through astonishing case studies and insights.

This remarkable book goes into the viscera of purpose, showing how it propels performance and profit and doesn’t detract from them. It starts with a few insights from Larry Fink, CEO of BlackRock and one of the world’s greatest asset managers, who argues that purpose and profits are two sides of the same coin — unless both sides are deeply cut, the coin is a counterfeit. BlackRock manages not just the money but the trust of people and, as such, typifies deep purpose. The book was probably inspired by Mr Fink’s classic letter on profit and purpose. As the book argues, the problem isn’t that business leaders have the wrong intentions. It is that they find combining profitability with purpose an overwhelming task because they don’t understand the concept and how to go about executing it.

India today has the world’s third-largest start-up ecosystem with over 50,000 start-ups and about 2,000 investors chasing them. The eternal question for them is: Should growth come first or a higher calling? Dr Gulati’s book would suggest that the latter, not the former, should be at the heart of start-ups, even if that is something with which most venture capitalists might not agree. What would happen if a start-up that had everything going for it, including a higher purpose, finds itself unprofitable, even after splurging investor money to acquire customers while pursuing this higher calling?

The book makes a nuanced distinction between shallow and deep purpose and shows how several prominent companies such as Facebook, Theranos and others practice “purpose washing” mainly to hide behind a veil to disguise their own self-serving motive which is harmful to both individuals and institutions. By going deep into companies as diverse as Lego to Microsoft the book discovers the kernel of purpose and how it goes beyond corporate social responsibility (CSR) or conscious capitalism. Microsoft is today the toast of the world under Satya Nadella’s leadership. He helped it rediscover its deep purpose and become a mobile-first and cloud-first company, from being a jaded monopolist selling clunky software, all within the span of less than a decade. He did so by going beyond Maslow’s self-actualisation by reimagining a new world where his employees could add value to others and themselves by finding and following their own deep purposes.

There is an eternal trade-off especially with modern Internet economy companies. For instance, Google Maps is used by us to do many day-to-day things including finding places, whereas the same Google maps is also used by terrorists to plant bombs. Facebook connects many communities and helps bring people together but has been seen to encourage divisive behaviour between human beings and various groups in society. Above all, there is overwhelming evidence of efforts by foreign actors to subvert US elections, thereby striking at the very heart of democracy via Facebook. So, should Google Maps and Facebook be banned? If not, how can they be regulated by government to make them find their original, authentic deep purpose? The book could do well by guiding political leaders on the kind of regulatory tools they can use to resolve these eternal dilemmas, thereby enabling governments, too, to find their own deep purpose. This is perhaps one of the few things missing in the book.

One of the interesting insights in the book is about how Mahindra & Mahindra tries to find its own deep purpose through one of its executives, Shipra Kumari, who went into the Haryana badlands to help farmers solve the problem of a lack of agricultural labour which in turn prevents them from harvesting their crops in time. Through this programme called “Rise,” Anand Mahindra has given deep purpose to an organisation that is producing world-class products for India and the world.

The book also looks at established companies such as Boeing, Johnson and Johnson and shows how they realise the absence of the purpose only after a long period of organisational decay, by which time it is too late to bring them back from the brink.

Deep Purpose is a modern-day timeless classic on how individuals and institutions intersect to produce performance and profit through the alchemy of purpose. Its cases, insights and lessons go a long way, not just by telling us valuable stories but by also nudging the reader towards finding their own deep purpose in life. This is something few others have succeeded in doing.

The reviewer is an IAS officer. Views are personal. @srivatsakrishna