Start with Why

Chapter 8: Start with why, but know how

Energy motivates but charisma inspires. Energy is easy to see, measure and copy. All great leaders have charisma because all great leaders have clarity of WHY; an undying belief in a purpose or cause bigger than themselves. Charisma has nothing to do with energy; it comes from a clarity of WHY. It comes from absolute conviction in an ideal bigger than oneself.

Chapter 13: The origins of a WHY

Before it can gain any power or achieve any impact, an arrow must be pulled backwards, 180 degrees away from the target. And that's also where a WHY derives its power. The WHY does not come from looking ahead at what you want to achieve and figuring out an appropriate strategy to get there. It is not born out of any market research. It does not come from extensive interviews with customers or even employees. It comes from looking in the completely opposite direction from where you are now. Finding WHY is a process of discovery, not invention. Gaining clarity of WHY is not the hard part. It is the discipline to trust one´s gut, to stay true to one's purpose, cause or beliefs, remaining completely in balance and authentic is the most difficult part.

Consistency of WHAT

Everything you say and everything you do have to prove what you believe. A WHY is just a belief. HOWs are the actions you take to realize that belief. And WHATs are the results of those actions - everything you say and do. With consistency people will see and hear, without a shadow of doubt, what you believe. The only way people will know what you believe is by things you say and do, and if you´re not consistent in the things you say and do, no one will know what you believe. What authenticity means is that your golden circle is in balance. It means that everything you say and everything you do you actually believe. Only when that happens can the things you say and do be viewed as authentic. Being authentic is not a requirement for success, but it is if you want that success to be a lasting success. Authenticity is when you say and do the things you actually believe. Without a WHY, any attempt at authenticity will almost always be inauthentic.

Chapter 11: When why goes fuzzy

Ex: Wal-Mart. Sam Walton believed that if he looked after people, people would look after him. The more Wal-Mart cold give to employees, customers and the community, the more that employees, customers and community would give back to wal mart. Wal-Mart was WHAT Walton built to serve his fellow human being. Service was his higher cause.

Fear

Fear, real or perceived, is arguably the most powerful manipulation.

I have a dream

For every great leader, for every WHY-type there is an inspired HOW-type who takes the intangible cause and builds the infrastructure that can give it life. That infrastructure is what actually makes any measurable change or success possible. The vision and charisma of the leader are enough to attract the innovators and the early adopters. Trusting their guts and intuition, these people will make the greatest sacrifices to help see the vision become a reality. With each success, with every tangible demonstration that the vision can in fact become more reality, the more practical-minded majority starts to take interest.

Price

For the seller, selling based on price is like heroin. The short-term gain is fantastic, but the more you do it, the harder it becomes to kick the habit. Once buyers get used to paying a lower-than-average price for a product or service, it is very hard to get them to pay more.

Manipulations lead to transactions, not loyalty

For transactions that occur an average of once, carrots and sticks are the best way to elicit the desired behavior. Manipulations are perfectly valid strategy for driving a transaction. It is the feeling of "we´re in this together" shared between customer and company that defines great leaders.

Say it only if you believe it

Great organizations don't just drive profits, they lead people and they change the course of industries and sometimes our lives in the process. When we don't know an organization WHY, we don't know what to expect, so we expect the minimum - price, quality, service, and features - the commodity stuff. But when we do have a sense for the WHY, we expect more.

Discipline of HOW

HOW are your values or principles that guide how to bring your cause to life. HOW we do things manifests in the systems and processes within an organization and the culture. For values or principles to be truly effective they have to be verbs. It's not "integrity", its "always do the right thing"; not "innovation", but "look at the problem from a different angle". Articulating our values as verbs gives us a clear idea; we have a clear idea of how to act in any situation.

Loyalty, real emotional value, exists in the brain of the buyer, not the seller.

If your WHYs and their WHY correspond, then they will see your products and services as tangible ways to prove what they believe. When WHY, HOW & WHAT are in balance, authenticity is achieved and the buyer feels fulfilled. Without WHY, the buyer is easily motivated by aspiration or fear. The golden circle provides a way to communicate consistent with how individuals receive information. For this reason and organization must be clear about its purpose, cause or belief and make sure that everything they say and do is consistent with and authentic to that belief. If the levels of the golden circle are in balance, all those who share the organizations view of the world will be drawn to it and its products like a moth to a light bulb.

If you don't know why, you can't know how

It I a false assumption that differentiation happens in HOW and WHAT you do. Simply offering a highquality product with more features or better services or a better price does not create difference. Doing so guarantees no success. Differentiation happens in WHY and HOW you do it. There are many ways to motivate people to do things, but loyalty comes from the ability to inspire people. Only when the WHY is clear and when people believe what you believe can a true relationship develop. Manipulations and inspiration are similar, but not the same. It is when that emotional feeling goes deeper than insecurity or dreams that the emotional reaction aligns with how we view ourselves. It is at that point that behavior moves from being motivated to inspired. When we are inspired, the decisions we make have more to do with who we are and less to do with the companies or products were buying. When our decisions feel right, we are willing to pay a premium or suffer an inconvenience for those products. Price, quality, features and service are important, but they are the cost of entry in business today.

Chapter 7: How a tipping point tips

It's the difference between a fad and an idea that changes an industry or society forever. Innovators pursue new products or ideas aggressively and are intrigued by any fundamental advance; being first is a central part of our lives. Although quick to see the potential and willing to take risks to try new technologies or ideas, early adopters are not idea generators like the innovators. But both groups are similar in that they rely heavily on their intuition. They trust their gut. Early adopters, like innovators but to a lesser degree, are willing to pay a premium or suffer some level of inconvenience to own a product or espouse an idea that feels right. Their willingness to suffer an inconvenience or pay a premium had less to do with how great the product was and more to do with their own sense of who they are. They wanted to be first. The early and late majority are more practical-minded. For them, rational factors matter more. The farther right you go on the curve, the more you will encounter the clients and customers who may need what you have, but don't necessarily believe what you believe. Everything usually boils down to price with them. They are rarely loyal and they rarely give referral. It's near impossible to achieve if you point your marketing and resources to the middle of the bell. This is because the early majority will not try something until someone else has tried it. Loyalty is when people are willing to suffer some inconvenience or pay a premium do business with you. The goal of a business should not be to simply sell to anyone who wants what you have - the majority - but rather to find people who belieeve what you believe, the left side of the bell curve. Their willingness to pay a premium to use your product or service says more about them than it does about you and your products. Get enough of the people on the left side of the curve on your side and they encourage the rest to follow. If you have the discipline to focus on the early adopters, the majority will come along eventually. But it must start with WHY. You don't just want any influencer; you want someone who believes what you believe. Only then will they talk about you without any prompts or incentives. If they truly believe in what you believe and if they are truly on the left side of the curve they won't need to be incentivized; they'll do it because they want to

The price you pay for the money you make

Manipulations don't breed loyalty, although they can drive sales. Over time, they cost more and more. And they increase the stress for both buyer and seller. Repeat business is when people do business with you multiple times. Loyalty is when people are willing to turn down a better product or better price to continue doing business with you. Loyal customers often don´t even bother to research the competition. Addicted to the short term results, business today has largely become a series of quick fixes added on one after another.

Achievement vs. success

Many people who achieve great success don't always feel it. Achievement is something you reach or attain, like a goal. It is something tangible, clearly defined and measurable. Success, in contrast, is a feeling or a state of being. Achievement comes when you pursue and attain WHAT you want. Success comes when you are clear in pursuit of WHY you want it. The former is motivated by tangible factors while the latter by something deeper in the brain, where we lack the capacity to put those feelings into word. Those with the ability to never lose sight of WHY and also achieve the milestones that keep everyone focused in the right direction are the great leaders. For great leaders, the Golden Circle is in balance. They are in a pursuit of WHY, they hold themselves accountable to HOW they do it and WHAT they do serves as the tangible proof of what they believe

Chapter 12: Split happens

Nearly every company or organization starts the same way: with an idea. At the beginning, ideas are fueled by passion. That very compelling emotion that causes us to do quite irrational things. This passion is o intoxicating and exciting that it can affect others as wellThe reason so many small businesses fail is because passion alone can't cut it. For passion to survive, it needs structure. A WHY without the HOWs passion without structure, has a very big probability of failure. Passion need structure to survive, bu for structure to grow, it needs passion.

The definition of trust

Only when individuals can trust the culture or organization will they take personal risks in order to advance that culture or organization as a whole. Great organizations become great because the people inside the organization feel protected. The strong sense of culture creates a sense of belonging and acts like a net. People come to work knowing that their bosses, colleagues and the organization as a whole will look out for them. This results in reciprocal behavior. Individual decisions, efforts and behavior that support, benefit and protect the long-term interest of the organization as a whole. Only with mutual trust can an organization become great. Trust comes from being a part of a culture or organization with a common set of values and beliefs. Trust is maintained when the values and benefits are actively managed. An organization must work actively to remind everyone WHY the company exists. WHY it was founded in the first place. What it believes. Passion comes from feeling like you are a part of something that you believe in, something bigger than yourself.

Chapter 4: This is not opinion. This is biology

Our need to belong is not rational, but it is a constant that exists across all people in all cultures. It is a feeling we get when those around us share our values and beliefs. When we feel like we belong we feel connected and we feel safe. As humans we crave the feeling and we seek it out. No matter where we go, we trust those with whom we are able to perceive common values or beliefs. We want to be around people and companies who are like us and share our beliefs. When a company clearly communicates their WHY and we believe what they believe, then we will sometimes go to extraordinary lengths to include those products or brands in our lives. This is not because they are better, but because markers or symbols of the values and beliefs we hold dear. We are drawn to leaders and organizations that are good at communicating what they believ

Innovation happens a the edges

Paying someone a lot of money and asking them to come up with great ideas ensures very little. However, pulling together a team of likeminded people and giving them a cause to pursue ensures a greater sense of teamwork and camaraderie. The role of a leader is not to come up with all the great ideas. The role of a leader is to create an environment in which great ideas can happen. Companies that define themselves by WHAT they do instead of WHY they do it instruct their people to be innovative around a product or service. "Make it better", they are instructed. Those who work for Apple´s competitors, companies that have defined themselves as "computer manufacturers", come to work to develop "more innovative" computers. The best they can do is add more RAM or small features that probably to will change the course of an industry. Apple does not have a lock on good ideas; there are smart, innovative thinkers at most companies. But great companies give their people a purpose or challenge around which to develop ideas rather than simply instruct them to make a better mousetrap. Companies with a clear sense of WHY tend to ignore their competition, whereas those with a fuzzy sense of WHY are obsessed with what others are doing. People who come to work with a clear sense of WHY are less prone to giving up after a few failures because they understand the higher cause. Edison: "I didn't find a way to make a light bulb, I found a thousand ways how not to make one"

It's what you can't see that matters

Products with a clear sense of WHY give people a way to tell the outside world who they are and what they believe. If a company does not have a clear sense of WHY then it is impossible for the outside world to perceive anything more than WHAT the company does. And when that happens, manipulations that rely on price, features, service or quality become the primary currency of differentiation.

Novelty

Real innovation changes the course of industries or even societies, like the light bulb, the microwave and iTunes. Adding a camera to a mobile phone is not an innovation - a great feature, but not industry altering. Novelty can drive sales but the impact does not last. If a company adds too many novel ideas too often, it can have a similar impact on the product or category as the price game. In an attempt to differentiate with more features, the product start to look and feel more like commodities and, like price, the need to add yet another product to the line of compensate for the commodization ends in a downward spiral.

The chosen path

Regardless of WHAT we do in our lives, our WHY - our driving purpose, cause or belief - never changes. If our golden circle is in balance, WHAT we do is simply the tangible way we find to breathe life into that cause. When a WHY is clear, those who share that belief will be drawn to it and maybe wants to take part in bringing it to life. If that clear belief is amplified it can have the power to rally even more believers to raise their hands and declare. Inspiration only starts the process; you need something more to drive a movement.

Chapter 10: Communication is not about speaking, it's about listening

Symbols help us make tangible that which is intangible. And the only reason symbols have meaning is because we infuse them with meaning. That meaning lives in our minds, not in the item itself. Only when the purpose, cause or belief is clear can a symbol command great power. A symbol cannot have any deep meaning until we know WHY it exists in terms bigger than simply to identify the company. Without clarity of WHY, a logo is just a logo. For a logo to become a symbol, people must be inspired to use that logo to say something about who they are. Harley Davidson: it no longer simplify identifies a company and its products; it identifies a belief. The symbol is no longer about Harley. The logo embodies an entire value set - their own. The symbol is no longer about Harley, it's about them. What a company says and does are the means by which the company speaks. Too many companies put a disproportionate amount of weight on their products or services simply because those are the things that bring in money. Though products may drive sales, they alone cannot create loyalty. The celery test - check it out!

Introduction: why start with why?

The ability to motivate people is, in itself, not difficult. It is usually tied to some external factor. Great leaders, in contrast are able to inspire people to act. Those who are able to inspire give people a sense of purpose or belonging that has little to do with any external incentive or benefit to be gained. Those who truly lead are able to create a following of people who act not because they were swayed, but because they were inspired. For those who are inspired, the motivation to act is deeply personal. They are less likely to be swayed by incentives. Those who are inspired are willing to pay a premium or endure inconvenience, even personal suffering. Those who are able to inspire will create a following of people - supporters, voters, customers, workers - who act for the good of the whole not because they have to, but because they want to. People who love going to work are more productive and creative. They go home happier and have happier families. They treat their colleagues and clients and customers better. Inspired employees make for stronger companies and stronger economies.

Chapter 3: The golden circle

The golden circle finds order and predictability in human behavior. Put simply, it helps us understand why we do what we do. WHAT: every single company on the planet knows what they do. HOW: are often given to explain how something is different or better, like USP or value proposition. WHY: very few people can clearly articulate why they do what they do - what is your purpose, cause or belief? When most companies and people think, act or communicate they do so from the outside in, from WHAT to WHY.

Those who know WHY need those who know HOW

The pessimists are usually right, but it is the optimists that change the world. Most people in the world are HOW-types. Most people are quite functional in the real world and can do their jobs and do very well. Some may be very successful and even make millions of dollars, but they will never build billion dollar businesses or change the world. Without someone inspire by their vision and the knowledge to make it reality, most WHY-types end up as starving visionaries, people with all the answers but never accomplishing much themselves. In order to alter the course of an industry requires a very special and rare partnership between one who knows WHY and those who know HOW. It is the partnership of the future and talent to get it done that makes an organization great. The vision is a public statement of the founder's intent, WHY the company exists. It is literally the vision of a future that does not yet exist. The mission statement is a description of the route, the guiding principles - HOW the company intends to create hat future.

Manipulation vs. inspiration

There are only two ways of influence human behavior: you can manipulate it or you can inspire it. Typical manipulations include dropping the price, running a promotion, using fear, peer pressure etc. when companies do not have a clear sense of why their customers are their customers, they tend to rely on a disproponiate number of manipulations to get what they need

Refusing to consider the law of diffusion will cost you

TiVo example: Attempted to appeal to the cynical majority by explaining WHAT the product did instead of stating WHY the company or the product existed in the first place. They attempted to convince with features and benefits: We've got a new product. It pause live TV. Skips commercial. Rewinds live TV. Memorizes your viewing habits and records shows on your behalf without your needing to see it. Tivo attempted to convince consumers to buy by telling them only WHAT the product did. Features and rational benefits. The practical-minded, technophobic mass markets response was predictable. " I don't understand it. I don't need it. I don't like it. You are scaring me". What TiVo should have done is talked about what they believed. They should have talked about WHY the product was invented in the first place, and then ventured out to share their invention with the innovators and early adopters who believed what they believed. Like this: If you're the kind of person who likes to have total control of every aspect of your life, boy do we have a product for you. It pause live TV. It skips commercials. Rewinds live TV. Memorizing your viewing habits and records shows on your behalf without you needing to see it. In this version, all the features and rational benefits serve as a tangible proof of WHY his product exists in the first place. When you start with WHY, those who believe what you believe are drawn to you for very personal reasons. It is those who share your values and beliefs, not the quality of your products that will cause the system to tip. Your role in the process is to be crystal clear about what purpose, cause or belief you exist to champion, and to show how your products and services help advance that cause.

Chapter 6: The emergence of trust

Trust is not a checklist. Fulfilling all your responsibilities does not create trust. Trust is a feeling, not a rational experience. Trust begins to emerge when we have a sense that another person or organization is driven by other things than their own self-gain. With trust comes a sense of value - real value, not just value equated with money. Value, by definition, is the transference of trust. You have to earn trust by communicating and demonstrating that you share the same values and beliefs. You have to talk about your WHY and prove it with WHAT you do. WHY is just a belief, HOWs are the actions we take to realize that belief, and WHATs are the results of those actions. When all three are in balance, trust is built and value is perceived. Leading is not the same as being the leader. Being a leader means you hold the highest rank. Leading, however, means that others willingly follow you - not because they have to, not because they are paid to, but because they want to. Those who trust work hard because they feel like they are working for something bigger than themselves. Beyond the structure and systems a company is nothing more than a collection of people. People live their life to win. The only variation is the score we use. For some its money, for others its fame or awards. The drive to win is not, per se, a bad thing. Problems arise when the metrics become the only measure of success, when what you achieve is no longer tied to WHY you set out to achieve it in the first place

Build a megaphone that works

Volume is reasonably easy to achieve. All it takes is money or stunts. Money can pay to keep the message front and center. And publicity stunts are good at getting on the news. But neither plants seeds of loyalty. For a message to have real impact, to affect behavior and seed loyalty, it needs more than publicity. It needs to publicize some higher purpose, cause or belief to which those with similar values and beliefs can relate. Clarity of purpose, cause or belief is important, but it is equally important that people hear you. For a WHY to have the power to move people it must not only be clear, it must be amplified to reach enough people to tip the scale. Without a clear message - what will you amplify?

The influence of others

We are more likely to trust those who share our values and beliefs. When we believe someone has our best interest in mind because it is in their benefit to do so, the whole group benefits.

Chapter 1: Assume you know

We make assumptions about the world around us based on sometimes incomplete or false information - we make decisions based on what we think we know. Do we really know why some organizations succeed and why others don´t, or do we just assume? If things don't go as expected, it's probably because we've missed one. More data, however, doesn't always help. There are other factors that must be considered, factors that exist outside of our rational, analytical, information-hungry brains

The only difference between you and a caveman is the car you drive

We've succeeded as a species because of our ability to form cultures. Cultures are groups of people who come together around a common set of values and beliefs. When we share values and beliefs with others, we form trust. We´re friends with people who see the world the way we see it, who share our views and our belief set. We do better in places that reflect our own values and beliefs. A company is a culture, a group of people brought together around a common set of values and beliefs. The goal is not to hire people who simply have a skill set you need, the goal is to hire people who believes what you believe.

Chapter 9: Know why. Know how. Then what?

When a company is small the founder has plenty of direct contact with the outside world. As it grows the leader's role changes. He will no longer be the loudest part of the megaphone; he will become the source of message that is to flow through the megaphone. The WHY exits in the part of the brain that control feelings and decision-making but not language. WHATs exist in the part of the brain that controls rational thought and language. The leader sitting at the top of the organization is the inspiration, the symbol of the reason we do what we do. They represent the emotional limbic brain. WHAT the company says and does represents the rational thought and language of the neocortex. The struggle that so many companies have to differentiate or communicate their true value to the outside world is not a business problem, it's a biology problem. And just like a person struggling to put her emotions into word, we rely on metaphors, imagery, and analogies in an attempt to communicate how we feel. Absent the proper language to share our deep emotions, our purpose, cause or belief, we tell stories. We use symbols. We create tangible things for those who believe what we believe to point to say, "that's why I'm inspired". If done properly, that's what marketing, branding and products and services become; a way for organizations to communicate to the outside world. Communicate clearly and you shall be understood

Gut decisions don't happen in your stomach

When a decision feels right, we have a hard time explaining why we did what we did. Decisionmaking and the ability to explain those decisions exist in different parts of the brain. This is the famous gut decision, and it happens in the limbic brain. The reason gut decisions feel right is because the limbic brain also controls our feelings. His limbic brain is smart and often knows the right thing to do. It is our inability to verbalize the reasons that may cause us to doubt ourselves or trust the empirical evidence when our gut tells us not to Henry Ford: if I had asked people what they wanted, they would have said a faster horse. This is the genius of great leadership. Great leaders and organizations are good at seeing what most of us can't see. They are good at giving us things we should never think of asking for. Great leaders are those who trust their gut. They are those who understand the art before science they win hearts before minds. They are the ones who start with WHY.

Finding the people who believes what you believe

When employees belong, they will guarantee your success. And they won't be working hard and looking for innovative solution for you, they will be doing it for themselves. The goal is to hire those who are passionate for your WHY, your purpose, cause or belief, and who have the attitude that fits your culture. Once that is established, only then should their skill set and experience be evaluated. Great companies do not hire skilled people and motivate them; they hire already motivated people and inspire them. People are either motivated or they are not. Unless you give motivated people something to believe in, something bigger than their job to work toward they will motivate themselves to find a new job and you´ll be stuck with whosever left. Companies with a strong sense of WHY are able to inspire their employees. Those employees are more productive and innovative, and the feeling they bring to work attracts other people eager to work there as well. When people inside the company know WHY they come to work, people outside the company are vastly more likely to understand WHY the company is special.

Chapter 5: Clarity, discipline and consistency

When manipulations thrive, uncertainty increases for buyers, instability increases for sellers and stress increases for all.

Peer pressure

When marketers report that a majority of a population or a group of experts prefers their product over another, they are attempting to sway the buyer to believing that whatever they are selling is better. Peer pressure works not because the majority or the experts are always right, but because we fear that we may be wrong.

Three degrees of certainty

When we can only point to tangible elements or rational measurements, the highest level of confidence we can give is: I think this is the right decision. When we make gut decisions, the highest level of confidence we can offer is: the decision feels right, even if it flies in the face of all the facts and figures. The ability to put a WHY into words provides the emotional context for decisions. When you know your WHY, the highest level of confidence you can offer is: I know its right. When you know the decision is right, not only does it feel right, but you can also rationalize it and easily put it into words. The goal of business should not be to do business with anyone who simply wants what you have. It should be to focus on the people who believe what you believe.

Chapter 14: the new competition

When you compete against everyone else, no one wants to help you. But when you compete against yourself, everyone wants to help you. Now think about how we do business. Were always competing against someone else. Were always trying to be better that someone else. Better quality. More features. Better service. Were always comparing ourselves to others. And no one wants to help us. What if we showed up to work every day to be better than ourselves? For no other reason than because we want to leave the organization in a better state than we found it? All organizations starts with WHY, but only the great ones keep their WHY clear year after year. Those who forget WHY they were founded show up to the race every day to outdo someone else instead of to outdo themselves.