Leveraging Business Simulations for effective leadership development

Leading with Purpose, Part 1

Most CEOs I speak with are not 100% at peace with their company’s purpose. As the market, their people and their business evolve, so will their purpose. As some of the best companies of past and present show us, there is strength, and even magic, in a great company purpose. What is also clear, however, is that this magic does not come from just having a “purpose” or “vision,” but rather from how well a company is executing against their purpose.

When Southwest Airlines (which has been profitable for 45 consecutive years, and on FORTUNE’s list of World’s Most Admired Companies for 24 straight years) was first starting out, their mission was to make flying affordable.¹ They rallied their people on the idea that a grandmother should be able to affordably buy a ticket, at the drop of a hat, to get on a flight to see her new grandchild. This simple mission led to the “Southwest Effect,” which transformed the airline industry, and continued to be a lens with which the Southwest leadership team made key decisions.

Today, Southwest’s vision has evolved: “To become the world’s most loved, most flown, and most profitable airline.” And they are executing on this vision. They continue to drive superior shareholder returns against all industries on the S&P 500 (as they have for the past 44 years), and in 2018 were named the top low-cost airline in JD Powers customer survey reports for the second year in a row.

As the Southwest example highlights, great company purpose combined with a leadership team who will build the work-flows, culture, processes and metrics to live up to it can be an enormous employee motivator. But we have also experienced, both at BTS and with our global clients, that a good company vision and purpose on their own are not sufficient – employees need them to be even more personal to them as an individual. I remember a lunch I had twelve years ago with a 24-year old new hire who was my direct report. After some small talk he looked at me and said, “Why are you here? Why have you spent seven years with the same company?”

I’ll never forget that lunch. It was the first time I had been asked the question, and it was the beginning of a new decade where our employees were much louder and more active about wanting to reflect and spend time on our mission and purpose, linking it to their personal values and the impact they strived to have in the world. Luke, that 24-year old new hire, has made me and our company better as a result of his question.

In the last decade, there has been a growing emphasis in the business world on finding a deeper motivation to unlock greater meaning at work. For some this may sound ‘fluffy,’ or as one executive we spoke to commented, “Is this just the next version of the pursuit of vision and values? It sounds great on paper but too often makes little real difference as it tends to stay on the wall, rather than live in your heart.”

Yet your people spend the majority of their life at work and with colleagues. At its best, a sense of purpose is a way of bringing meaning to their work and understanding the contributions they are making to the company, as well as greater society. It makes sense, then, that employees who are clear on their personal and professional purpose end their work day invigorated and proud of what they’re doing instead of exhausted by mindless work that is bereft of real meaning.

According to a recent PWC study, 79% of business leaders believe that purpose is central to business success – but only 34% use their organization’s purpose as a guidepost for their leadership team’s decision-making. Signs that your workplace may be lacking organizational purpose are distracted employees and a lack of comradery. These are significant factors – so why don’t more organizations devote time to developing clear purpose and values? Well, developing organizational purpose is no easy task, and much of it starts with your own personal purpose. If you’re unsure of what exactly your own personal purpose is, have no fear – in the next two installments of this blog series, we will offer simple steps to help you uncover your personal and organizational purposes and get closer to leading through the lens of purpose.

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hroughout her more than 15-year career at BTS, Jessica has pioneered turning strategy into action through the use of customized experiences & simulations for leading Fortune 500 clients and many large and start-up software companies in Silicon Valley. Jessica leads BTS USA with P&L responsibility for offices in San Francisco, Philadelphia, New York, Chicago, Phoenix, and Austin.

Although one of the most-discussed topics in business today, meaningful diversity seems to be elusive for most companies. We sat down for a casual and candid conversation with Jessica and uncovered some surprising insights about our clients’ challenges in creating a more diverse and inclusive workplace, and what companies can do about it.

We are lucky to have snagged a few moments of Jessica’s time — squeezed between a flight to New York for a client meeting and her morning school drop-off duties — to hear her perspective.

JENNY JONSSON: We have a lot to cover today, so if it’s ok with you, we’re going to jump right in! First, we would love to hear a little about your journey to becoming a Global Partner (GP) – and of course, it’s hard to conduct research for a paper on diversity and ignore that there’s a gender imbalance at our GP level.

JESSICA SKON: Well first of all, while I may be the only female Global Partner, I don’t want to lose sight of the fact that we do have a lot of women leaders at BTS: 35% of our Heads of Office are women. With that said, what I can say about my experience is that it has been fair. I don’t think I would still be here if I didn’t feel the expectations and the performance processes over the last 17 years were fair, and I have never felt like gender has been a factor in performance conversations. When I reflect on that after talking to other female leaders, that’s a pretty big deal.

MJ DOCTORS: Why do you think your experience has been so different from what many other working women encounter?

JS: Before my first Global Partner meeting, where we were looking at candidates for Principal and above, I was told, “This is always the best meeting of the year.” I wondered how it could be so drastically different than any other meeting, but they were right — it is an entirely data-driven, unemotional, and fair process.

It was a simple process and there were no biases. There are three parts to how we evaluate partners up for promotion:

1. The background information on each candidate includes all of the specific promotion criteria and supporting data.
2. The leader recommending the promotion gives a 5-minute summary emphasizing their view of the candidate’s weaknesses and areas for growth in the coming years.
3. A fellow partner who has done due diligence against the facts acts as the “inquisitor” and shares findings.

This approach ensures it isn’t just a pitchfest. And this process is also something that has trickled down to other areas of the business, reducing a lot of the biases in our hiring and promoting.

JJ: Have you been approached by clients asking for guidance on a similar data-driven approach?

JP: Absolutely, clients realize they need to make this shift. I think it’s going to happen really quickly: we already have one client whose CEO has asked us to rebuild their entire performance system so that it’s more data-driven, more accurate, and more fair. In many companies, the way things are now, it’s often gray and you can’t help but rely on relationships and favoritism to guide promotion decisions.

MD: As part of our research, Jenny and I took a look at how BTS USA is performing on diversity metrics. While most publications and companies measure diversity by simply looking at gender and race (such as Fortune’s 50 Most Diverse Companies), we believe diversity is much more than that. Our definition encompasses gender and race, but also age, socioeconomics, gender identity, sexual orientation, education, life experiences, disability status, and personality traits — and the list could go on. However, as we currently only have results across race and gender, that’s what we’ll share here. How do you feel when you look at these charts?

JS: You’re bringing me back to 5 years ago when we had the same color chart for gender as we do now for ethnicity — which was horrifying. I think we all knew it was a problem but we weren’t mature enough in our thinking to solve it. Once we all woke up and clearly defined that we had a gender parity problem across the company, we were persistent and fixed it, and now I am proud of our gender pie chart. That is something I love about BTS: if we can clearly articulate a problem, we tend to be able to solve it. That’s actually the key for leaders across most industries: the art is being able to clearly define the problem.

But I think that we’re at ground zero again for the next phase.  I would love for us to apply the same rigor we used to address gender disparities to other forms of diversity so that in 3 or 4 years we have a better mix, and why wouldn’t we?

JJ: Can you outline specifically how we made progress on our lack of gender diversity?

JS: We took a few major steps:

1. Our Heads of Office decided it was a top priority. Without top leadership’s buy-in, you can’t really make progress.
2. Then we identified the key pain point: for us, it was the entry to the funnel. Then we brainstormed the best ways to attract more female candidates.
3. This led to some “ahas” about the root cause of that pain point. Many people think that consulting is inflexible and it’s difficult for employees with children to succeed. But there’s nothing further from the truth at BTS. Our Global CEO is quite progressive and incredibly flexible and open-minded when it comes to letting employees do what they need for their lives.
4. So then our leaders got on the megaphone: our (now retired) US CEO began flying to each of our offices to talk about it, and I got on the phone with candidates to tell them my story of being a young working mother. A lot changed once we started to focus on it.
5. In reviewing our hiring interview process, we also realized we could be more clear in our criteria, with observable behaviors and a more robust scoring rubric. This change eliminated any unconscious bias and we found that woman were scoring as high as our male candidates. When we looked in the past, they were (on average) scoring lower.

MD: Besides clearly defining the problem, what other factors pushed forward this change?

JS: Clients started noticing and asking for more women consultants, so it became an easy sell to our leadership. Our demographics should match – or even be ahead of – our clients’ demographics. We shouldn’t have to be scrambling every time a client says, “Um… there’s a lot of men here.” Sure, some traditional clients may not have said anything, so for some folks internally it was more difficult to understand the impetus behind the huge investment we were making in changing our recruitment process. But we also had enough examples of women starting at BTS who didn’t have many female role models. And we realized, we have to change this or some of our best people are going to leave.

JJ: So what about our clients? You have spent significant time over the past 20 years with CEOs and senior leaders of some of the world’s top companies. What aspects of diversity are they discussing the most?

JS: In the last couple of months, I have heard many top executives discussing how to change the paradigm of their leaders to promote and move people around who don’t necessarily fit the makeup of the candidates from the past. So for example, one client said that they have been really good at keeping people for life, but realize that they might not be able to maintain that with millennials, unless they can keep having great careers for them.

Also, companies still tend to focus on “the résumé”: did the applicant go to an Ivy League school, did she have a fancy job, how long did he work in this department, etc. All of this has been the formula for success over the last 50 years. But if we don’t crack that mindset, there will be amazing people who don’t get put in the right positions, because unconsciously our leaders are not seeing them or they are not open-minded enough to realize that this candidate might be better suited than that more traditional-looking candidate.

MD: What is some advice you would give clients to change that mindset?

JS: You and all your leaders have to first recognize your beliefs and own them before any mindset change can happen. That may be kind of obvious, but getting yourself and your senior leaders to fully own their beliefs is hard. You have to be both very self-aware and constantly striving to improve. It’s a battle every single day.

So when an executive comes to me and says, “This is weighing on my mind at the company-wide level,” I don’t say, “Well there’s a diversity training that we can do.” I do say, “You’re talking about changing deeply rooted mindsets: this requires getting leaders to articulate, own, and put those issues on the table, and commit to changing their beliefs moving forward.”

This is crucial to making sure you have the right people in the right jobs and you’re retaining the people that you want, which ultimately enables you to make the company successful. That is an immense amount of work, including interventions, working sessions, and sometimes coaching. It’s sometimes getting the most skeptical leaders to become the owners of this and driving these change management efforts. It’s deeper than just a training class.

JJ: If it’s not just a training class, what do you see as the platform?

JS: Any time you’re trying to drive large scale transformation, it’s a good idea to run experiments. And once they get some momentum and prove to be successful, you should shine a really big light on them to get broad adoption and then begin the comprehensive change management process.

So even though it’s out of our core services, I try to give clients ideas on small stuff they can do that is totally different than anything they have done before, to shake up people’s way of thinking about how they recruit, hire, train, promote, and think about people. I think a strong example of an initiative a company has experimented with is a leading software company and their strategic partnerships with nonprofits who help them access more and different talent pools.

So – once those initiatives have gained that momentum, it would be fun for us to do some consulting with their executives first around owning the beliefs, the history (it’s important to honor the history and not just break it), what worked in the past, what beliefs do you now hold as a result, and what are you going to do moving forward. All of this can be built around an experience that shifts people’s mindsets. It’s not so much diversity training… it’s a mindset shift process that starts at top leadership.

MD: Are there any companies that are beginning to successfully make this mindset shift and use more data-driven approaches to evaluation?

JS: Not really… that’s what’s tough about this. It’s bizarrely new. The more BTS is asked to provide broader talent services, the more surprised I am. We’re basically back in the Stone Age. It’s not pretty.

But we’re starting to work on something internally to track an individual’s acquisition of skills in a moment-based approach. At the beginning of a project the individual comes up with specific skills that she wants to work on. Then, during critical milestones and at the completion of the project, the rest of the team gives feedback on those specific areas. That’s real curation of a skillset, where the individual can own her career progress, people can validate it, and the company can say, “oh, she’s telling us she’s ready for a promotion, look, she’s actually done all of these things and demonstrated she can be successful.”

JJ: So really it’s democratizing the job application and promotion process.

JS: Yes! That’s exactly why many of our clients have turned to selection and assessment solutions. Assessments enable our clients to reduce unconscious bias in the hiring and promotion processes and ensure that a candidate has the actual skills necessary for the role, as opposed to a particular degree from a particular university, which is, at best, only a moderate proxy for job fit. Through these solutions, our clients effectively expand their talent pool and improve the likelihood that the candidates they hire have both skill and culture fit, which can lead to increased cognitive diversity – that is, team members who have different backgrounds and thus approach problems in different ways – improved retention, and reduced recruiting costs.

MD: We are seeing some progress from expanded talent pools, but the critical question is, once a female or a non-white employee has joined a company, why aren’t they moving up as fast as white men?

JS: I think maybe it goes back to the issue that I heard from one of our clients: there’s a history of certain roles looking and acting a certain way. It’s hard to overcome the unconscious bias of hiring and promoting people who fit that perception.

It could also be that people aren’t putting their hat in the ring for those promotions. Women and people from certain cultures aren’t oriented toward self-promotion and won’t put their hat in the ring if they are only 10% confident they’ll be successful. So in that case, you really have to focus on the current leaders: it’s so important that they understand this dynamic. Even at BTS, there are so many outstanding individuals who don’t self-promote, and you have to be the megaphone for them.

JJ: When running our leadership development simulation experiences, BTS has always encouraged participants to form the most diverse teams possible (gender, culture, geography, role, tenure, etc.). What’s the origin behind why we ask our clients to create diverse simulation teams?

JS: Initially, this was primarily because our clients value enabling leaders to create networks across the company, more so than because of any inherent desire for cognitive diversity. Clients often come to us when they need a push toward a “one company” mindset, so simulation teams are built to bring people out of their silos and align around a single company goal.

But, nowadays, people recognize that cognitive diversity is a good thing. That being said, at BTS, we are very protective of our culture and team environment, and sometimes we’re guilty of mistaking like-minded people as a proxy for “I think I’ll get along with you”. So you have to have two heads when hiring: we want someone different who will shake us up, but we also want to be at peace and have fun and a strong culture fit.

MD: If you could leave one piece of advice for leaders hoping to create a more diverse and inclusive workplace, what would it be?

JS: In alignment with Liz Wiseman‘s book, “Rookie Smarts,” I’m trying to get leaders to crave being rookies again. If you’re going to learn as fast as the pace of change, and be able to transform yourself, you have to be a bit of an adrenaline junkie with a “rookie mindset”. I want people to realize that it’s not scary to do something different and new – it’s exciting. And, if you put yourself in an uncomfortable role, you get humbled, become curious, and seek advice from the best around you. As a result, you will most likely do the best work of your life.

There is a correlation between the “rookie mindset” and shifting beliefs in support of a more diverse team: we need leaders who crave differences. That has to be the overarching mindset when you’re recruiting and looking to add members to your team. If you crave differences in skills and personal history and combine that with culture-fit, then innovative ideas, high performance, and fun should follow. Others will notice the benefits of the diverse team and follow, assuming the appropriate recruitment and performance systems are in place. That’s how you start to shift mindsets at the top and eventually throughout the company.

About the Authors

Diversity has been a passion area for both MJ Doctors and Jenny Jonsson, both of whom have spent significant time – prior to and while at BTS – working to improve economic opportunities for women, immigrants, and individuals of varying socioeconomic backgrounds.

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Leading with Purpose, Part 2

As we discussed in the first post of this blog series, purpose is an essential ingredient for business success and employee engagement today. Yet purpose is a nebulous concept, and often difficult to pinpoint. I know this firsthand. Around twelve years ago, a consultant in his early 20s joined the BTS San Francisco office where I was working, and I took him out to lunch. Within ten minutes of sitting down to lunch, he asked me, “So what’s your purpose? Why have you been at the firm for so long?” I’ll never forget it. I’d been at the company over six years, and that was the first time somebody asked me that. I felt it was a fair question, and yet I didn’t have an eloquent answer at the ready.

Coming up with a response, I started to talk about some of my guiding principles, things like learning and having fun, how I’m proud of the impact our work has on clients, and how I love building a team of leaders (or a business) that grows every year. The question from this new hire, though, who was probably ten years younger than me, put me on the spot and made me feel a bit inadequate as a leader. At first I did not have a crisp, compelling answer.

Since then I’ve been in many dinners with other executives from Fortune 500 companies to tech startups, who more and more frequently are being expected to lead their organizations with a clear purpose… and at the same time understand that each employee’s purpose and what motivates them is going to be slightly different than theirs, the firm’s and their peers’, and that’s okay. Once a leader or a firm has clarity of purpose it can be a beautiful energy and driving force, and should be the first lens with which leaders run their business.

So, how does one find a sense of purpose?

In truth, many people assume that only those who follow a vocation like medicine, teaching or work in the charitable sectors can have a true sense of purpose at work. Our experience, as well as much current research and writing, would suggest otherwise.

One simple way of looking at this is captured elegantly by the Japanese concept of Ikigai, or ‘The reason for being.’ The idea of Ikigai is that one’s sense of purpose lies at the intersection of the answer to four questions:

1. What do I love?
2. What am I good at?
3. What can I get paid for?
4. What does the world need?

Image from Forbes.com

Take these four questions and look at the organization you are already a part of. Use them to see if you are in touching distance of doing more purposeful work, whether it be at the core of what you do or as a part of work that sits slightly outside the current definition of your job. Whilst we may not get the ultimate answer to the purpose question from our current work, once we have identified our own Ikigai we can go in search of the more meaningful elements of our jobs and start shaping the agenda at work in a new way. In the next installment in this blog series, we will discuss how to use your personal purpose to shape your organizational purpose and lead with meaning.

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