Your Company's Soulless If It Lacks These 3 Things — Here's How You Can Fix It

As businesses grow, many entrepreneurs worry about losing touch with their company's original purpose — its soul, if you will. Harvard Business School professor Ranjay Gulati wanted to understand the problem better, so he interviewed 65 CEOs of fast-growth ventures.

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"I came to realize very quickly that there's a tension between wanting to be grown up and big, but not losing that entrepreneurial spirit," he said. "I found many of them lamenting 'the good old days.'"

Gulati kept researching, and ultimately came to a solution: To stay true to their company's mission, even as their business grows and becomes more structured, leaders must understand what he calls their "deep purpose."

He's since written a book called Deep Purpose and hosts a podcast by the same name. Here, Gulati explains how entrepreneurs can identify their deep purpose, and why it can help guide a company's growth.

People worry about losing their company's soul — but what does that really mean?

I discovered there are three components of the soul: customer connection, employee experience, and what I call intent. I came to realize that companies need to have a purpose. Really successful companies that are growing — they start with a very strong intent or purpose of, "Why are we in business?"

Let's define a company's "purpose" because it can be easily misunderstood. If I sell hotdogs, I could say that my purpose is to sell hotdogs. But you're talking about something deeper, right?

Every business starts with the "what we do." On top of it sits the why question, why do we exist ? It's the why question that forces you to imagine yourself in the short and long run. I never thought of the "why" question, but I'm finding that these really amazing companies start with the why question.

Now, what is purpose? Purpose is an individual-level construct. It's been defined for thousands of years, but in modern day, Stanford psychologist William Damon defines it as a stable and generalized intention to accomplish something that is at the same time meaningful to the self and consequential for the world beyond the self. The "why" question forces you to think about your place in the world at large.

Purpose is not a purpose statement. Don't get me wrong. It's not like, "Let's write a mission statement. Done. Check box." Purpose is really asking yourself the question and really spending time debating and dwelling on that question. I've seen companies spend months and months and months debating this question — why are we in business ?

Let's say a company answers that question. How can they maintain that answer as they grow?

This is where people start to lament. They lament the loss of this strong connection with the company. Modern-day economists like to define an organization as a nexus of contracts: Everyone is in a contractual relationship with the company. But if you look at some organizations, it's not about a contract. You feel deeply identified and connected to the organization.

You remember the old story about one of the presidents who went to NASA in the 60s and met a janitor and said, "Hey, what do you do over here?" And the janitor said, "Mr. President, I'm here to put a man on the moon." It's kind of a cliche now. The cynical view is this is just a brainwash to get people to work harder for less pay. But remember, when people have purpose in their lives and in their work, they are healthier and happier too. So let's not forget that there are psychobiological benefits of having a purpose orientation in our life, and work is one part of our life.

So, how would you recommend that leaders identify and articulate this purpose and then help the people that they work with feel connected to it?

My book and podcast are called Deep Purpose, not just Purpose. I was very deliberate about that because I think a lot of companies and individuals use what I call superficial or shallow purpose. Some even have pretend-purpose thinking; it's like a PR exercise or a slogan.

Purpose is a wonderful strategic tool. It helps you sharpen your strategy. It helps you think about the implementation of your strategy. It helps you communicate your vision very clearly. It helps motivate and inspire people. Now, you want all those benefits. It also engages your customers, too, by the way, who experience you as more trustworthy. If you want to do all that and you want to get all the benefits of purpose, it has to mean something.

It's really about an emotional connection. So, not only do you need to write it down — you must communicate it. I talk about storytelling. Why is your purpose important for the venture? From there, how do you make it part of your DNA? How do you make it something you measure yourself on?

So you're identifying something that scales with you — that isn't anchored to a specific product or service, way to operate, or structure of the business.

I just wrote an article called " To See The Way Forward, Look Back ." The argument is that, a lot of times, people say, "Disavow your past. Do you want to be a dynamic company? Look forward."

What I discovered in my research was that the really successful companies are willing to engage with their past. You look backward in order to look forward, and then connect the dots.

At Lego, the CEO said, "Let me go back to the founder, and what was his vision for the company when he started it?" And it turned out his vision was intelligent play . Then the question was, what did he mean by intelligent play? How do we modernize that? That was 100 years ago. How do we take that essence of that idea and refresh it? How do you turn and connect the past into our future?

You don't want to forget your past foundational story. You look back while looking forward. I hope all of us will think about our own purpose in the organization in which we work, and connect our own purpose in some ways to the organization we work in.