The Purpose Revolution, Show Your Value And Tell Your Story with John Izzo

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TSP 153 | Purpose RevolutionEpisode Summary:

What happens when businesses put purpose at the top of the list? Companies that focus on purpose and people are happier and more successful than the ones that don’t. The Purpose Revolution drives people to do better and be better. Employees become committed to work because they don’t feel like its work when they enjoy doing what they do and where they do it. John Izzo, President of Izzo Associates teaches clients that by connecting with people, you gain competitive advantage with a value level that goes past the product or the service. Learn how you can use purpose to compete with all the disruption and contribute to the social good.

Our guest is Dr. John Izzo, who is the author of The Purpose Revolution. John has so many great insights as to the importance of having a purpose in your business and in your personal life. He said, “When you connect to people’s values and have a purpose, you get them to become loyal. It also gives you a competitive advantage, but not forever, so you need to act now.” He also said, “One of the best ways to show your purpose is at the point of sale. Can people see what your purpose and what your story of good is when they’re buying your product at the checkout?” He said, “Begin your meetings with anybody sharing an idea of how what you’re all doing as a company is making a difference in others’ lives.”

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The Purpose Revolution, Show Your Value And Tell Your Story with John Izzo

John Izzo is the President of Izzo Associates. He has spoken to over 1 million people and advised over 500 companies including IBM, Quantas, Verizon, Walmart, and Microsoft. He is the author of several books including Awakening the Corporate Soul, and the The Purpose Revolution. John, welcome to the show.

Thank you. It’s great to be here.

You are a master storyteller. What we love to talk about here on The Successful Pitch are great stories that pull at people’s heart strings and are memorable. Before we get into your book, The Purpose Revolution, I just wondered if you wouldn’t mind taking us back to your own story of origin. Did you always know you wanted to be an author and a speaker? How did your own journey start?

Growing up in New York City as a young boy, I was always a do-gooder. I was always more driven by purpose than anything else. There’s only three careers I considered doing when I was a young person. One was to go to law school so I could go into politics. At the time, I thought of politics as a worthy profession, not some slimy opportunistic one. Another one was to be a journalist to expose bad things and tell great stories, or to become a minister. I grew up in a Presbyterian Church in New York City. I sometimes like to say I have wound up marrying all three of those careers. I’m involved in issues I care about, especially the role that business plays in society. I’ve written books that have mostly been journalistic exercises to hear and find out what’s working and to tell those stories to inspire others to change. Finally, I preach 70 to 80 times a year. Unlike a good preacher, I don’t have to write a new sermon every week. Even though I was a do-gooder, I always was a type-A entrepreneurial person. The world of business always fascinated me because I liked to get things done and I like the energy of business, which is often very pragmatic. I did a lot of various things in my career before starting Izzo Associates 22 years ago. The rest is history.

What a great background and combination of multiple things all coming together. Many times, people think, “Something I did ten years ago is not going to impact what I’m doing now.” I find the opposite. It’s unexpected connections that happen, so everything we are interested in and curious about and do helps pull us in to being uniquely qualified to talk about something that no one else has because we have our own unique experiences.

In my case, I did spend six years as a Presbyterian minister. I got to be with people in the most profound and important moments of their lives. I honed my skills speaking to the same audience week after week and having to come up with a new talk to inspire them. I got a degree in journalism. You asked if I always wanted to write books. I remember writing my first beginning of a play when I was ten years old. I remember my family making fun it, but it did not dissuade me from the writing life. I did always have a passion for writing and telling stories. My publisher, Berrett-Koehler, the President, says that my real gift is to go out and find out what’s working and to tell the story and connect the dots. This new book is no exception that I believe in many ways that’s what I’ve done.

Let’s take a dive into the book, The Purpose Revolution. I know you have a keynote around that very topic as well. The subtitle is also interesting to me, How Leaders Create Engagement and Competitive Advantage in an Age of Social Good. There’s three things that pop out there. There’s been some research that more and more companies are all talking about the importance of social good, not just making money, in the companies that they invested in and what consumers are looking for. What happens when a business doesn’t have a purpose?

TSP 153 | Purpose Revolution

The Purpose Revolution: How Leaders Create Engagement and Competitive Advantage in an Age of Social Good

There are three fundamental things as we think about this idea of The Purpose Revolution. First, purpose-focused people and purpose-focused companies have always been happier and more successful than ones that aren’t. If we think about some of the most successful companies over generations, whether it’s Southwest Airlines that always wanted to treat guests and their employees with great dignity, or Vanguard who soon may pass BlackRock as the largest manager of money in the world that began with a very simple purpose to give the average investor a shot to be successful so they started the low-cost ETF movement. Purpose-focused companies have always been, over time, more successful than ones that are less purpose-focused. We know that people who see their job as a calling, not only are they happier but they perform better on every metric that we care about as business owners. They call in sick less, they’re more productive, they provide better service, they’re more committed, they’re more engaged, they stay longer. We know that purpose has always been a key to a happy life and a successful business.

What’s new is a revolution of expectations where three key groups all over the world are saying, “This is a major reason why I would go to work for someone.” Around 80% of employees say that they want to work for companies they believe in. 50 % of millennials say they would take a pay cut to work for a company or a job that had purpose. A full 40 % of the global workforce are using purpose as a major way they decide who to work for and who not to work for. About 80 % of the customers globally say they want to buy from companies they believe in, who are aligned with their values. About 34 % of global consumers are regularly punishing companies that do bad and rewarding ones that do good. What the revolution is about is that people are saying, “I’m demanding this. It’s becoming a major screen through which I decide who to buy it from, who to work for, and who to invest in.” Wells Fargo and Volkswagen, both of whom share prices were decimated by their choice not to be purpose driven to open accounts for people who didn’t want them and to say you were green and creating green diesel, when in fact you created a software that would lie to the people who would measure your emissions. Increasingly, these companies are being punished and good companies being rewarded with retention, engagement, and stock price.

It’s a demand both from the employees and the consumers to have a purpose be a big part of why they’re going to work and why people are supporting those companies. Starbucks was the first one to come up on my radar of not only giving employees benefits when they work part time, but also tapping into local communities and giving back that way. How can people use this purpose to compete with all the disruption going on? How does that become a competitive advantage?

First, there is a revolution. In the first 30 % of the book, we make the case. Here’s the revolution. Here’s how things are changing customers, employees and investors. Here’s why most companies are failing at purpose and failing to benefit from that. The second is engagement. We’ve talked about employees more engaged, more likely to attract top talent, customers are more loyal. We know at organizations like Unilever that brands that have made a purpose connection with their consumers, like Dove and Ben & Jerry’s, are growing on average 35% faster than their brands that don’t have a connection with their customers. The third piece is competitive advantage. When I’m in front of an audience, one of the questions I ask people is, “In an age of commoditization, how do you find competitive advantage?” Think about the traditional levers we use to compete with other companies. Quality is rarely a differentiator because everyone has quality and great customer service. Everyone has a return policy that’s amazing. You can’t be in business anymore if you’ve got low quality or bad service. Some people are a little better, but the game has gotten even. How about price? Almost everyone now has to compete on price. If your prices are significantly higher than your competitors, in all but a few cases, you will have to match their prices. What about innovation and products?

Whenever I’m doing a keynote, I sometimes will ask people at their table to come up with ten companies in the world that are sustainably successful because their products are fundamentally different than their competitors. No table can get to ten. The obvious ones come up, Apple, Tesla. Once you get past three or four, nobody can find anybody who’s differentiated because their products are fundamentally different. Where then can you find competitive advantage? Connecting to people’s values and connecting to their sense of purpose is an advantage very hard to duplicate. Ben & Jerry’s is one of the companies we feature in the book. They know that about 60% of people buy from them mostly because they like their ice cream, but about 40% of their customers are connected to them because of their values and the things that Ben & Jerry’s stands for whether it’s climate change, LGBT rights, or their support of organic and local farmers. Those 40% of customers that have done the research never leave. When Häagen-Dazs and other premium ice creams put their ice cream on sale, these people don’t leave. The reason is because they feel a part of the Ben & Jerry’s story because of their value. This is one of the few true places of differentiation in an age of commoditization.

You’re doing two things. You’re getting people in the story Which is what I love to do when you’re talking to people how you convince anyone to buy anything from you is put them in your story. In this case, it’s the story of what your values are in Ben & Jerry’s. Once people are in your story or aligned with your values, you’ve got the loyalty factor that is that not sensitive to price differentiation anymore. That’s what everybody wants is to not be seen as a commodity. The best way to do that is this new insight that you provided. Connect to people’s values and you get a competitive advantage.

[Tweet “Connecting to people’s values is the ultimate connection.”]

I support Starbucks on a regular basis even though they’re often more costly. I don’t even like their coffee as much as I like some other people’s coffee, but because of the work they’ve done around social issues, how they’ve treated their employees, some stands they have taken on issues that I care about, I support this company. I support them with my dollars, and it becomes where I feel a part of their story. Steve Jobs once said, “Connecting to people’s values is the ultimate connection.” In the book, we talk about Apple as a great example. If you ask people why Apple was so successful, almost everyone will say because of their products. That’s true now because everyone buys Apple, but in the beginning, people forget that when Steve Jobs came back to Apple, they were performing in a very mediocre way. What he did was he started to think different campaign. He said to his leaders, “We will not be able to compete on bits and feats. Everyone’s got that. We have to stand for something.” “Think different” became the value. In the old days, before everybody bought Apple, you knew an Apple user not because they had an Apple but because their glasses were different, their pants were different, and their shoes were different. They bought Apple in part because of the connection to the value that thinking differently was a value to the world. Even some of the companies we think are successful only because of their products are often successful because they somehow connect to a value that is more powerful than the product.

One of the things you talk about in the book is the purpose gap, which is that employees and customers want a purpose but they’re not getting it. We’ve talked about how few companies seem to have it, but how big is this gap?

The gap is a tremendous opportunity. This book is not just for the CEO. Whether you’re running a little store or a small business or a leader with a team, this book walks you through how to engage purpose whether your whole company has it or not. Here’s the interesting thing about the gap. While 80% of employees say they want to work for a company that gives them a sense of purpose and that they believe in, 70% of global employees say, “The company that I work for mostly cares about profits and its own self-interest, not the well-being of its clients, customers, or society.” Think about the tremendous opportunity there. I don’t think 70% of companies only care about profits, but it means that most companies are doing an incredibly poor job of helping purpose be at center stage in their business, of doing the things we talk about, the practical ideas in the book that the winners are doing, creating line of sight to purpose, getting people engaged in purpose, driving job purpose instead of job function. This is a big opportunity because 80% want it and 70% said, “I’m not getting it.”

The same gap exists with customers where 83% of global customers say, “I want to buy from companies that are good,” but they only have confidence that about 6% of the brands are good. They look and are confused. “I don’t know if Procter & Gamble or Unilever or Clorox is good.” Another gap is we want it but we feel routinely confused about who’s good and who’s not. The book is filled with lots of ideas about how to close that gap whether it’s with employees or customers. Unilever did a study that showed about a trillion-dollar opportunity for companies who can close the gap and help customers see the story of good that is authentic. If you could close that gap, there’s about a trillion-dollar opportunity in terms of increased business globally.

What would you say are three things that companies big or small could do to become more purpose- focused?

There’s a few key things. On the customer side, right at the point of sale, can I easily see your story of good in an authentic way? One of the most powerful things we know for customers is on the label, in the store, in the point of sale, is there some believable story of good? My co-author Jeff VanderWielen tells a wonderful story about being in Peet’s Coffee and having right there at the till, the story of farmers that they’re supporting in Africa and all the good that they’ve done for them. “Buy this particular coffee right here and you can help support the work that we’re doing.” He talked about how right at that point of sale, he believed that story. There’s a restaurant chain that we’re familiar with in Europe called Be Good Foods. Anybody can have a title in their restaurant, “Be Good”, but they have a giant sign in their store that says, “What we mean by being good.” It’s a chalkboard so they can change it over time. They tell you, “Here’s five things about what we mean by being good and how we’re living being good every day.” If you have an authentic story of good right at the point of sale, tell that story in an authentic way that’s believable.

TSP 153 | Purpose Revolution

Purpose Revolution: If you have an authentic story of good right at the point of sale, tell that story in an authentic way that’s believable.

On the employee’s side, number one, leaders have to start watching how much they communicate about numbers and task versus profit and purpose. Think about the average meeting in your team or your company and the communications that come from leaders in the company. What percentage is about profit and task and what percentage is telling the story of the real difference you are making with clients, customers, and society? Most companies, if they do that audit, will find out that about 80% of their communication is about profit and task, about 20% are on purpose and the difference they’re making. We have to try and flip that around. It’s not just about the formal communication, it’s the subtle communication. Someone was telling me they were in a meeting in their company. The head of customer service was telling a beautiful story about something they had done to make a difference for a customer who had a problem. Halfway through the story, the CEO interrupted him and said, “Could you hurry up a little bit? We got to get to the finance report.”

That leader probably did not intend to send the message that purpose wasn’t the thing that mattered most in that company, but that’s the message that people received. The first thing you can do is start looking at your communication. If I’m a team leader, how about start every meeting with, “Has anybody have a story of how we made a difference for someone, a client, customer, or community since the last time we were together?” Make that the first thing that begins every meeting in your company. Let people get engaged and tell their story. Another thing you have to do is engage people to talk about their purpose. One of the things we talk about in the book is getting every employee to identify their personal purpose and their purpose in their job. Powerful things happen when you start to engage people in identifying their own purpose at work. As we say in the book, “You’ve got to give people hands-on purpose.” It’s not a spectator sport. You can’t give people their purpose. You’ve got to create an environment where they can identify it for themselves.

I want to share how I’ve taken what you’re talking about and what you wrote about in The Purpose Revolution and put it into action in a startup that I’m the Chief Marketing Officer of. We’re sitting around having these conversations as we go out for investors, as we go out for finding people to become advisers, and ultimately creating our message on the website. We all needed to agree before we even started that we all had a similar purpose and vision beyond just making money. We used your book as the guidepost. This concept of point of sale, what we’re doing is called QUANTM.one, which is going to help people who have equity in their house and want to take it out to possibly take some of that cash and send their kid to college. If they do that, typically their only option is to take out a second mortgage. A lot of people say, “My budget is tight. I can’t pay a second mortgage. If you’re going to give me cash in exchange for owning 10% of my home, it’s not a loan, you’re just owning 10% of my home. I could stay in the house as long as I want, and when I sell the house you get a check and we get a check depending on the percentages.” That seems to be a big social impact on helping people get some cash out without going into more debt.

We got excited about that as purpose for what we’re doing. The way we’re doing it is by using cryptocurrency and creating a token. Instead of Bitcoin, it’s going to be the QUANTM token that is going to be backed by actual real estate. For investors, they suddenly say, “I’m putting my money on buying a token that actually has some net asset value because it is backed by some real estate.” Everyone’s winning. The customer is getting money out without another loan and the investors are saying, “You’re giving me something that I can see the value of because it actually has real estate behind it, and that makes me feel less stressed out.” Let’s start with the customer experience. Does that seem like it’s on track? There are a lot of people that want some of that equity out of their house but don’t want a bigger loan. Do you see that that is a social impact?

I definitely think it is a social impact. One of the things around purpose is that the first purpose of every company is to have the best interests of their customers and clients in mind. Don Guloien, the former CEO and now Chairman of Manulife Financial said something that struck me. He said, “Almost every company, small or large, began in the beginning with that purpose, to solve a real problem that people were having.” That’s how Airbnb started, because the founders couldn’t find a place to stay. That’s the basic first purpose is are we meeting a need that isn’t filled in in people’s lives or in society?

What we do at the end of every week is we recap our progress because it’s so easy to get stuck on the task that we need to do and how much money we raise. I was talking to my mom, whose house is paid off, and she’s tapping out on her IRA savings thinking what’s she going to do. She doesn’t want a reverse mortgage and would this work for her? We said, “Yes.” We would give her cash in exchange for ownership of the house. That way, she doesn’t have to worry about any interest accumulating. We all got jazzed that there’s another group of people that could benefit from this. The following week, someone said, “I know someone who’s not retired, but they’ve paid off their house, and yet their financial planner said to them, ‘70% of your assets are tied up in your house. You need to diversify.’” They’re like, “How do I do that besides selling the house or taking a loan out? I don’t want to do either of those.” They said, “We could own 10% of the house and give them some cash. They can either buy cryptocurrency with it, they could remodel, they could invest in anything else besides real estate, giving them some choices.” It’s fun for us to keep tapping into these individual people and how our overall purpose is creating stories, to begin those meetings with how we’re making a difference keeps us all inspired.

[Tweet “Powerful things happen when you start to engage people in identifying their own purpose at work.”]

It’s a great teaching point. One of the ways you fan purpose in a company is to create line of sight to purpose, which is consistently helping people see how our products and services are making a difference. As your company grows, bringing in people whose lives have been changed by this, making sure that those stories are alive inside the company is so important. One of the people we feature in the book is one of the most successful Molly Maid franchisees in the world, a young woman who’s kicking the pants off of much older franchise owners. One of the things that she does is she regularly brings in busy moms to single moms to say, “I can’t tell you what it’s like to come home to an oasis of calm in my crazy life where everything is always a mess,” or the son or daughter of an older person who’s home they clean are saying, “My mother is lonely. She doesn’t get a lot of visitors, and the way you befriended her has alleviated a lot of loneliness in her life and I want to thank you.” That’s what we call a line of sight to purpose. One thing I recommend for you as your company grows is make sure that is continually happening so that people never forget it’s not just about money. It’s actually about truly contributing.

My goal is always to create little case stories of who this is for and what problem it helps. As we get those stories and those people, get little video testimonials or even a couple of paragraphs with a picture, brings it to life. Part of my job as the Chief Marketing Officer is to find other brands that we might want to do business with. I was thinking, “Who makes sense and how could I align with another company who’s got a similar purpose to what we’re doing?”

One of the companies we’re in conversations with is Farmers Insurance because if you’ve got equity in your house that you’re able to take some cash out of, it probably means your house is worth more than when you bought it. 90% of the people do not increase their homeowner’s insurance when that happens. What happens when there’s a fire or an earthquake or mudslide or a hurricane? There’s not enough insurance to rebuild their home. To partner with a company like Farmers Insurance, to say, “If you’re triggering cash out of your house, then you might want to have us take another look at it to make sure that if you need your house rebuilt, there’s enough insurance for that.” After watching all these stories of people losing their homes and fires in California or hurricanes in Puerto Rico, your heart goes out to them going, “I hope there’s insurance to cover that.” That’s where, for me, got exciting from a marketing standpoint of, “How could we not just market with any brand but market with a company that had an impact socially?”

One could see that as just about making more money or one could say, “We really have a chance to make a difference.” Just continually focusing on that is such a critical aspect of leading for purpose.

One of the things you say in your book is, “Don’t be afraid to claim a moral mandate and state it loudly that you care about people and society.” I just wanted to applaud that because sometimes people are afraid, “We don’t want to be seen as a company that’s not focused on profits because investors won’t do it.” That’s why your book is called The Purpose Revolution. It’s a revolution. If you’re not doing that, you’re not only not attracting the right people, you’re repelling them.

What’s so important for people to understand is this is now a major lever. BlackRock sent out this letter to companies all over the world saying, “If you’re not doing good and you’re doing bad, we’re not going to invest in you, so get ready.” This is a tsunami about to hit companies. Here’s the thing that is important for people to remember. First of all, when we have purpose and we focus on the good we are doing, we are happier and we feel better. I discovered most business owners and leaders want to leave a legacy. They don’t just care about profits. 30 years from now when you’re sitting in your rocking chair, you’re not going to be thinking about the quarterly profits. You’re going to think about what the legacy was of your company.

[Tweet “When we have purpose and we focus on the good we are doing, we are happier and we feel better.”]

The second thing is that increasingly, this is going to become a place of differentiation. Don’t think the window is going to stay open very long. I compare this to the quality revolution in the 1970s and early 1980s. Only a few people benefited from the quality revolution; FedEx, Toyota, Honda. The people who adopted quality early on got almost all the benefit from it. Sooner or later, everyone just had to have great quality. The same thing is true with this. In five or six years or seven years from now, it’s going to be very hard to differentiate around your purpose because if you don’t have one, no one’s going to want to do business with you. Because of this gap we talked about earlier, employees and customers want it but don’t feel they’re getting it or are confused. Those who can close that gap are going to have a big advantage at this time in the age of social good.

It is the same thing with those windows of opportunity to differentiate yourself and have a competitive advantage. We can’t wait for everyone else to be doing it. One of my favorite takeaways from our interview is monitoring this 80/20 rule. 80% of the time, are we just talking about profits and tasks and only 20% about the purpose? What happens if we flip that? The irony is if you keep focusing on purpose, the money and the tasks will come.

It’s always important to remember that profits are a reward and byproduct of us fulfilling a purpose, which is solving real problems for people and society. Steve Jobs, he was considered a jerk to work for personally, but he believed in that mantra that profits were a byproduct of purpose, not the other way around. We forget that at our peril that’s why it’s so important to do that. Communication is so critical. A few years ago, I was coaching an executive who ran a big division for an aerospace company. She was very successful, a great numbers person, but nobody thought she was very connected to the purpose of the business, to keep the peace and to protect the soldiers. She cared deeply about this, but her communications said otherwise. All we did was coach her to begin every one of her talks and meetings connecting to purpose, to consistently start telling stories of the real difference that they are making for the country and for the world. I watched over a year period where her brand grows, where she got more meaning out of her work, where people liked her, where engagement went up, where commitment went up. It all began with a leader examining how they were communicating and what they were talking about day-to-day.

What you focus on, you get more of. That’s my motto. Is there any final thought you have?

If you can’t sing the song that you came to sing in the company or the role that you’re in right now, then you owe it to your life to either find another place to sing your song or to find a way to sing the song you need to sing differently where you are. Purpose is a big thing for organizations, but also for us individually. Life’s too short not to have a job with purpose and a place where you can find meaning. It may mean changing to another place or it may mean starting to reconnect with the purpose of your work and the difference you want to make where you are.

[Tweet “Life’s too short not to have a job with purpose and a place where you can find meaning.”]

We all have music inside of us that needs to come out, and if you’re not in the right place that wants to hear that song, then find another place or change your song. Social media, anything you want to share with us?

DrJohnIzzo.com. It’s the same thing for Twitter, follow us there. It’s on LinkedIn as well, so it’s pretty easy to find me. If people want to know more about the book, just go to PurposeRevolutionBook.com. It has all the links to buy the book or download a free chapter. Whether you’re a business owner, a CEO, or someone who wants more purpose in your work, the book is filled with lots of exercises and practical things you can do to connect to purpose and lead purpose at whatever level you are.

I can’t recommend it enough. I’ve read it several times and I keep referring back to it multiple times. Thank you for being a great guest and for writing such another great book.

Thank you for your great work. Keep spreading those positive messages.

 

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