EXCERPT - FREE ARTICLES BY NIKOLAJ STAGIS & BASTIAN OVERGAARD
Nikolaj Stagis - Your business has the potential to change the world
Nikolaj Stagis is the CEO of the brand agency Stagis (stagis.com) which he founded when he was 20 years old. Now, 21 years later, he helps companies discover and develop business strategy and transform into purposeful brands.
Originally a graphic designer, the focus of his masters from Copenhagen Business School as well as a wide range of articles and a book was on authentic organisational identity. Nikolaj is a member of the international think-tank Medinge Group who promotes brands as a force for good (medinge.org).
The brands I love are businesses with a meaningful purpose and a clear attitude towards who they are and what they stand for. The businesses are not necessarily charitable. They may not save lives. But they fascinate me and make me curious. I get the urge to try their services, work for them – become a part of what they stand for and the community that surrounds them. They are passionate about what they do and have their own special way of doing business.
The authentic companies have a meaningful purpose, use their history as inspiration to develop the future of their business, and are capable of passionately making their purpose come alive in the everyday. Some of the most famous companies are successful in redefining their unique identity in order to create connections between the organisation’s strengths and the surrounding world, to which the business must be relevant. That these purpose-driven businesses succeed continuously in redefining and focusing their identity is because either the owners or the leaders are constantly curious about discovering and pointing out their company’s special strengths. Look at Jørgen Vig Knudstorp at LEGO. Look at René Redzepi at Noma. Federico Minoli, when he rescued the Ducati motorcycle brand. Or Michael Christiansen in the period when he was head of the Royal Danish Theatre. No matter whether the starting point was taking over a company with a century-long history or starting a completely new venture, and no matter the services and size of the company, they were successful in developing their business, in a way that was relevant and attractive to the company’s customers and stakeholders. But they were only successful in their leadership mission once they made a virtue of understanding what the company’s authentic strengths were.
Leaders must constantly develop the company’s identity
To create a clear purpose, the company must be aware of the authentic strengths it builds on. A central definition of the term authenticity is being “true to yourself”. That may sound simple enough. Many say that the company need only “walk the talk”, which is the most widespread misinterpretation of authenticity. When thought and speech are implemented in the everyday “walk”, it’s about the company’s integrity and ability to implement it’s beliefs in everyday life – not about authenticity.
When a company is authentic, it presupposes that it is true to itself – as opposed to e.g. following the customers, the market or the competitors. The primary challenge in being authentic lies in defining and understanding the company’s “self”. This should not only be understood as a specific permanent core of the identity – rather as an essential set of inherent strengths and potentials that are often composed of tangible and abstract characteristics, competences, knowledge and ideas. Although such strengths have a certain stability and recognisability over time, they also change. Google’s purpose is: “to make the world’s information accessible”, but there’s a difference in expression between how Google made information accessible when the search engine was launched in 1998, and how the business uses information to develop self-driving cars and artificial intelligence today. However, Google’s authentic strengths are to a large degree the same – then as now. Since René Redzepi and Claus Meyer first went on a journey of discovery in the geography, raw materials and food culture of the Nordic countries in 2003, the world’s most influential restaurant, Noma, has redefined what “making local food” means. Today, René Redzepi is still exploring how “local food” can be interpreted in practice in the kitchen and the restaurant experience. This includes moving the restaurant temporarily to Japan and Australia to discover, interpret and challenge their local food cultures. Only now, more than ten years later, René Redzepi says that he is about to realise his dream of a Nordic restaurant when Noma reopened as an urban farm on the edge of the Christiania neighbourhood in Copenhagen (Denmark). When a company is true to itself, it doesn’t entail a fixed meaning or permanent core to which the organisation must be faithful. Rather, the authentic companies are in a constant process where management and employees create new interpretations of the identity of the company.
There is a special managerial focus and a concrete leadership practice connected with achieving the dynamics that turn an organisation into an authentic company. In situations where managers successfully implement a turn-around and bring the business from crisis to success or create a new business that breaks with the market’s usual ways of thinking, the managers are often driven by an extraordinary curiosity, an ability to go exploring and regard the business as if the manager was an anthropologist who had to understand an unfamiliar tribe. That’s how Michael Christiansen described his greatest breakthrough at the Royal Theatre; it wasn’t until he physically sat in the orchestra pit alongside the musicians and tried to understand them that he successfully rose to the occasion as head of not just the orchestra but the entire organisation.
Unlike “authentic leadership” or being an authentic leader, management of the company’s authentic identity is about leading and developing the company while keeping in mind that there are unexploited potentials for development, innovation, customer experiences and better products hidden in the company’s history, culture and employees – often unnoticed and invisible in the company’s everyday life. This makes demands on the leader – middle manager, general manager or board chairman – to see opportunities in the company’s praxis to the same high degree as seeing them in the company’s figures.
Do you invest in future earnings – or in the future of us?
Apart from the banks, A.P. Møller – Mærsk is probably the company that Danes have mainly connected with big business and capitalism throughout history. If you ask Danes about the company’s purpose, I think many will say, “to earn money “. Mærsk’s purpose or raison d’etre is first and foremost financial – at least in the Danes’ view. That APM Terminals is currently investing DKK 14 billion in building a new port in Nigeria is primarily due to a belief that growth in Africa is long-lasting and that the terminal will become a good business in the future. The investment places A.P. Møller – Mærsk in a strategically important location and the venture draws a straight line back to the ability of the founder, Arnold Peter Møller, to see the opportunities of the maritime branch and generate long-term returns. But the port construction venture is also about the story of the Africans’ access to cheap transport of goods, about new jobs – and thus about supporting the possibility for development for the world’s poor. The good strategic investment thus contains a by-product of benefit to society, which surely pleases the leaders of the Mærsk group, but which is hardly their inducement to invest.
What would A.P. Møller – Mærsk achieve if the company changed its managerial focus from profitability to a broader perspective that balances the target of earnings with a target of creating a positive impact in the world? If the evaluation of a new project wasn’t determined by financial yields but by the importance for the employees of the Mærsk group, for Denmark as a nation, or by the value that the project could generate for the world’s poor, would the choice of investments then be different?
Corporate purpose isn’t charity
At the world’s leading enzyme company, Novozymes, new products that use enzymes for a wide range of industry uses are developed all the time. Enzymes can make detergents more effective, increase the shelf-life of bread and reduce the use of toxic chemicals in industry. When Novozymes was split off from Novo Nordisk and established as an independent company, the ambition was to create a viable business that would serve both society and the shareholders. According to its former CEO, Steen Riisgaard, progress in the environment and sustainability are only possible if they are good business at the same time. Novozymes is therefore both: a company that makes the world greener and more sustainable, while at the same time it has been successful in achieving growth and yielding profits throughout the whole of its lifetime.
Novozymes’s business model is in contrast to the way of thinking that is often presented when Corporate Social Responsibility (CSR) is being discussed. CSR is something that irks many business leaders as the company’s responsibility is often formulated as a consideration beyond and additional to the company’s operations and established purpose – and is therefore placed in an isolated department, remote from the company’s core operations, strategy development and sales. That LEGO and Novozymes – and potentially also the Danish giant A.P. Møller - Mærsk – are successful in their social responsibility without talking about CSR all the time is because their purpose, core business and impression on the world are one and the same thing. When LEGO communicates its annual results to the press, the company also explains how children’s brains and abilities develop when they play with LEGO bricks. Jørgen Vig Knudstorp and the LEGO management team have been successful because – said in popular terms – the company’s financials and purpose are in harmony.
Identity is vital for the company’s success
Authentic companies are often successful with being innovative, achieving a good financial position and creating value for society. They succeed in defining the organisational identity, purpose and business such that the brand is perceived as something special – by both employees, customers and the world about them. That LEGO is successful in constantly reporting a yield several times higher than that of its competitors such as Mattel and Hasbro is due to both LEGO’s success in asking a higher price and to its more efficient way of running its business. According to Jørgen Vig Knudstorp, LEGO has smaller staff and control functions than its competitors, while at the same time the organisation has a clear common focus, because the company’s purpose and strengths are well defined. Both the value experienced by the customers and the efficiency increase when the company defines its purpose meaningfully.
Crises can lead to success
Unfortunately, few companies work constantly with defining their purpose, identity and brand as an integral part of their strategy and operations. They must often go through serious crises before the subject of identity and purpose arises – often in the form of questions like “What do we do now?”, “What are we going to live from in the future?” or ultimately “Who are we?” Even though the questions often come a little too late, the crises also open up new opportunities.
Some of the world’s most successful brands have succeeded in taking a quantum leap in their development and strengthened their identity and brand after a crisis. When in 1982 the American medicine giant Johnson & Johnson was connected with seven deaths because someone had tinkered with the company’s Tylenol pill bottles, the crisis resulted in an affirmation of the founders’ attitude to give priority to doctors, nurses and patients rather than to the shareholders. As a consequence, Johnson & Johnson recalled 31 million pill bottles, offered to replace all the Tylenol pills on the market and developed a new three-level safety design for the pill bottles to ensure patient safety in the future. The crisis was thus a springboard for improving the product and strengthening the perception of the company’s fundamental principles both internally and in the marketplace.
In 2015, Volkswagen was found to be involved in a comprehensive swindle with measurements of toxic NOx emissions from 11 million Volkswagen diesel-driven vehicles. The group’s top executive, Martin Winterkorn, had to resign immediately, while the world press, the customers and the German government waited to see what the world’s second-largest carmaker would do. Initially, Volkswagen put the focus on its coming electric cars and then became relatively silent, betraying the trust in the brand. As a consequence, the confidence in the brand and the Volkswagen stock price only recovered slowly. But if, in the long term, the company’s new management was to successfully bring the VW brand back to its historic greatness, they would have to get to the front of the industry and show how swindle with toxic emissions could be avoided and how a trustworthy car manufacturer acts in today’s world. Volkswagen’s original purpose of creating a car for the people contains – as does the company name – an opportunity to develop after the crisis. How can VW become a car for the people to a greater extent than before? Through which products, service and communication will VW become not just “of the people” in perception but also in practical terms? If the new management exploits the critical situation and uses it in an age where social interaction, social (environmental) control, sharing economy and democracy take on new forms, and new global importance, it can lead to a new interpretation and a new meaningful life to the authentic company behind “the people’s car”.
Bastian Overgaard - Less talk, more value
Bastian Overgaard is expert in silence
Silence is frightening for many. Especially if it arises during a conversation. Then it’s called awkward, embarrassing or deadly. And a lot of nonsense has been uttered over time with the sole purpose of drowning it out.
Yes, silence is noisy. The question is: What is it that makes the noise?
Silence is merciless towards what we’re trying to repress. It sees through our ploy and tears our window-dressing to pieces. Nobody sees it as long as the music is playing. But if a so-called angel walks through the room, then we suddenly feel that we’re naked.
As an authentic leader you accept your vulnerability. You know who you are and have nothing to hide. You will therefore stand strong in this raw, honest field, enabling you to use it as a hands-on management tool.
In 2003 I gave a talk about breaking habits. In order to take my own medicine and illustrate a point, I asked the audience to be silent with me for three minutes. When the time had gone I asked them what they had experienced. Several described the focus and intimacy that arose in the intense togetherness. No one found it embarrassing. We’d taken this “artistic break” together, just like when we show respect at a commemoration.
The audience’s observations were acute, but there was a woman at the back of the hall who gave me an Aha experience and an important lesson in learning. She said: In the silence I suddenly remembered that you’re human.
Together with several others in the hall, I grinned spontaneously at her funny remark. But a few seconds later it became clear to me what she meant. When someone steps on to the stage, we quickly put that person in a box. We lean back and listen to “the expert”, and not the person, standing in front of us. He or she can be ever so wise, funny or motivating. There will still be a distance between us. Especially if the speaker isn’t authentic and unconsciously hides behind his or her title.
That corresponds with the distance we know from the traditional hierarchy in a business. A management structure that is slowly becoming obsolete. Together with the leaders who insist on feeling superior to their employees.
During my talk, a few minutes of silence created a feeling of equality between me and the woman in the hall. After that experience I carried out a number of experiments in which I asked people to spend time together in silence. Both with people they knew and complete strangers. The results were striking.
In the wordless room the participants experienced a high level of intimacy with and sympathy for each other - across their various career, age and educational backgrounds. My initial theory was that, since selfish agendas are often communicated orally, the ego is put at arm’s length when we meet in arranged silence.
After I had explored this idea for 12 years and tested it in practice, I was confirmed in its potential. No matter whether I have facilitated silent networking events, silent dinners or silent walks, the experience of authenticity has been felt by all participants.
Another common thread has been the good and attentive discussions after the periods of silence. Silence, of course, cannot replace a means of expression as strong as the spoken word. It is more about creating a better balance between thinking and speaking.
Many businesses suffer from an unbalanced chat culture with self-promoting employees and leaders who’ve forgotten the proverb “Speech is silver, but silence is golden”.
Innumerable meetings are held where everyone talks but no one listens. While one person makes his opinion known, another person is busy formulating his opinion. That is a direct abuse of the time spent at the meeting and is a particularly ineffective way of sharing knowledge. In comparison, I facilitate development workshops with up to 80% silence and 20% speech. And before these collaborations, most of my business customers believe they’re taking a chance with a new, long-haired consultant and his weird concept. The very idea of silence projects images of standing in a circle and walking in the forest. But afterwards they tell me that they rarely have been as concrete, focused and efficient. The most incisive feedback came after a two-hour strategy workshop:
In the silence we can all have our say.
If you rest in silence you do no need to contribute to the verbal pollution. But there will always be employees who love to hear themselves talk. Don’t count on them being able to stop themselves. Help them - and all the others - by facilitating obligatory artistic breaks. Even if it’s only for a minute at the weekly meeting. Or a 15-minute silent walk. You’ll discover that it doesn’t only give you time to reflect and take better decisions. It will also create a more effective and authentic collaboration.