08 Apr Focus on Purpose
Note: This is part of a series of posts about driving transformation through Mergers and Acquisitions (M&A). Here’s my first post. This summarises the M&A challenge and the ten recommendations I have for success.
A deal must be defined by purpose. Purpose is important; purpose is powerful. For anyone charged with the responsibility for driving a transformational initiative through M&A, they’d want to make damned sure the deal is defined by purpose.
A deal must be defined by purpose
Why Purpose is so important
Perhaps it was Simon Sinek’s best-selling book “Start with Why” that has a lot of people talking about purpose these days. It certainly got me thinking, and it’s a good thing that purpose is the talk of the town.
When I look back on the dozens of deals I’ve worked on over the last 20 years, I’ve noticed the abundance of time spent on what needs to be done to complete the deal. Even the how part, in terms of integration and synergy delivery, gets plenty of attention. But I have personally found the why part of a deal to be occasionally lacking; receiving only superficial treatment at best. This is lamentable as being able to understand, communicate and commit to the why part of a deal can be the most powerful motivator of all.
Explaining the ‘why’ can be the most powerful motivator of all.
The why part of a deal needs to convey a deeply felt sense of purpose, a shared ambition, and a seductive view on what the future holds. This provides the much needed emotional and intellectual energy from the team, staff and stakeholders to fuel M&A success. This isn’t about today’s problems, money, economics or shareholders. Instead, it needs to reflect something more aspirational in a way that creates shared meaning; a kind of purpose capable of transcending the demands of daily business. Without purpose there is no meaning; that’s why it’s so important.
Without purpose there is no meaning.
The three properties of purpose
The deal’s purpose needs to be far more sophisticated than a vision statement, slogan or financial goal. It needs to be a form of narrative that animates and motivates. Purpose represents a distillation of the following kind of properties: direction, discovery and destiny.
Purpose needs to provide a sense of direction with a particular point of view about the long term market or competitive position once the full potential of a deal has been realised.
Purpose needs to provide a sense of discovery insofar it holds the promise of new opportunities to learn, new ways of working with enticing changes both in structure and roles.
Purpose needs to provide a sense of destiny that makes the exercise as something that’s larger than the individual, and therefore worthy of personal commitment.
Purpose is direction, discovery and destiny
The four steps to bring purpose to life
Those leading the M&A transformation effort are accountable for crafting a compelling narrative that engages employees on an emotional level, helping them connect to the organisation’s purpose and thereby making their work personally meaningful.
The key steps are as follows:
- Discover. Do sufficient logical analysis to define the end state in terms of the target operating model, customer experience, product portfolio and desired organisational capabilities. This provides the necessary left-brained logic, reason and proof before taking a more emotive approach. This is akin to Logos in Aristotle’s art of rhetoric.
- Craft. Now develop the Pathos or passion. Craft the purpose, stories and simple rules into an overall narrative with the desired three properties: direction, discovery and destiny. Creative messaging within an emotionally powerful narrative is crucial to articulating purpose effectively.
- Activate. Enlist leaders who have earned credibility and trust from their teams. This is the Ethos or character that acts as the bridge from one person to the next. As communicators of purpose, they will need to take a walking and talking approach that embodies the transformational change ahead. Moreover, they need to be personally invested and be prepared to correct those exhibiting a behaviour that conflicts or undermines purpose.
- Sustain. Leaders must continue to walk the talk so that focus on purpose is energised and sustained throughout the transformation. They need to serve as role-models ensuring their own behaviours remain consistent with the words they communicate. This is critical during those inevitable occasions when spirits flag and engagement drops.
Go deep – surface purpose is not purpose
Purpose is important. Purpose is powerful. Make sure if you are driving transformation through M&A you have that special focus on purpose. Don’t be like other organisations who give it the superficial treatment. What’s needed is a deliberate, authentic and well-articulated narrative that defines deal purpose. Enlist the leaders and advocates throughout the organisation to find enduring ways to communicate and inculcate. Not only are the odds for success significantly increased, it will be a good deal more fun as well.
Hopefully, this particular tip has given you some thought. With this, and other posts in the series, I’m chipping in with my own thoughts and experiences so that all of us professionally involved – CEOs, CFOs, Executives, Product Managers, Consultants and Advisors – get that little bit better next time around. My email is below; happy to discuss this and other posts in further detail.
Thank you for reading!
BTD is conducting informal webinar discussions every week (13:00 UK time, Wednesdays), next weeks theme is: Preparing for Life ‘Beyond the Virus’ (1st in Series): Topic – Act Now: Preparing to Navigate M&A Post-Crisis. The panel will include Henryk Feszczur from GSK.
Please click here to join: https://zoom.us/j/367568518?pwd=UFhuRzZRQkwrUUlwWGJGZWIyR2hzdz09
Senior Consultant, BTD Consulting