SASIN SCHOOL OF MANAGEMENT
TOPICS: STRATEGY FORMULATION, VISION & MISSION, IKIGAI, CONNECTING PERSONAL PURPOSE TO ORGANIZATIONAL PURPOSE
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Okay. Where is Jerry? Are you okay? It doesn't matter. I think we can get started. Is everyone ready? Please sign in. I'll give you a couple of minutes.
Give it a few more seconds. Okay, back down to 51 and 49 — make sure you haven't been kicked out. You might need to resign in. I'm going to check that you're in before I move on. I saw 51 earlier, now it's back down to 49. Okay, looks like everyone's in. Anyone not in? Okay, let's go.
First question: What type of business model does Airbnb represent? Easy, right? There's a course on it at the moment. Okay, very good. Some of you said direct to consumer. It doesn't actually sell a product direct to consumer. It uses a platform to move from the supplier to the consumer, which is what a platform generally does. Okay, let's see who got that first. Jug — where's Jug? In the middle somewhere. There you are. Cool. Excellent. Next question.
Which country has the longest border with Thailand? Should be easy general knowledge. Cambodia's top of mind — that's the problem, right? It goes all the way down past Phuket, I think. Okay, let's see who got that one. On my knee — who's on my knee? I don't know first names. Ah, Onme. Okay, I forgot. Okay, great. Wonderful. Third question: What is Thailand's GDP?
This is obviously going to be wild guesses. Yeah, 500 billion, roughly 500 billion at the moment. So everything that you guys do in Thailand is part of that, right? And you can think about how you can increase both the pie and the market. Okay, who's ahead now? Tom. Quickest fingers. Excellent. And the final question: Which is the biggest AI company by market cap? Should be easy.
Six trillion, something like that. Anyway, the reason is because AI companies are not just the ones that actually run and build the AI models. There's a whole value chain and supply chain involved. And Nvidia supplies most of the chips for it. So it doesn't matter which company — OpenAI, Anthropic — they're all using Nvidia chips. Okay, so the winner is... let's see. Third place: Onme. And the winner: sitting in the corner there. Well done. There you go. Okay, so thanks, Jerry.
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Right. So today, we're going to cover a couple of things. Does anyone have any questions from yesterday, from last night that you want to discuss before we move on? Nothing at the moment. Okay. If it comes up, please shout out.
So today we're going to cover very quickly the process of strategy formulation. And then we're going to move into this idea of vision and mission and values, which people tend to ignore as a starting place for businesses, because fundamentally you need to know why your business exists and what it's going to do before you go ahead and do it. There are very strong reasons and rationales for understanding what your core purpose and vision are, because that allows you to make effective decisions that align to that from the beginning.
And then we'll spend some time looking at different types of business models. There's a whole range, but some of them are quite easy to identify. Some are a bit more complex and may include multiple factors, but we'll just get you to start looking at what sort of business model you're working with at the moment and what business model might be most effective.
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Start with this quote from Yogi Berra, who made some very interesting quotes in his career. He was a baseball player, not a philosopher. The point being: if you don't know where you are going, you'll end up somewhere else. So, do you know where you are going? That's my question to you — I'd like you to think about today.
The process of strategy formulation in the book talks about developing a strategic vision, mission, and core values as the foundation. Then setting objectives that align to help you achieve that. Then building your strategy and strategic plan to achieve those objectives, then executing it, monitoring as you go through, making changes, and eventually reviewing and revising.
What I think this particular framework misses out is something that starts beyond the idea of vision. Because a vision is really just a picture of what you want the future to be. Behind that for me lies this idea of purpose — the why. The why for us. And it may seem a little bit counterintuitive to talk about personal purpose when we're talking about business, but all businesses are made up of individuals, and each individual has an idea of what they want to do and where they want to go. And in your roles, as you move up in an organization, it becomes more important for you to understand why you are doing what you're doing and how that aligns with what the company is trying to achieve.
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Are you guys all Gen Z, or older? Gen Y? Gen Y. As far as I know, millennials are very keen on purpose and meaning and trying to save the world. They would rather take a job with the United Nations than with Credit Suisse, for example. For them, they want to find meaning in their work and they value that over purely financial gain. Where do you guys sit?
Student: Work-life balance.
Work-life balance. What does that mean? How do your work and your personal life interplay? It could be like what Jeff Bezos said, where work and life are completely intertwined, or it could be separate entities. Do you see it as two separate things? You come to work, you leave your home life behind, or do you intertwine them? For me, I tend to see it as the latter, but my job demands that I have to intertwine my work and my personal life. How about the rest of you? Is it intertwined or is it separate? Do you go home and forget about work?
Students: Cannot.
Right. And there are many companies that will tell you — or in the old days at least — leave your home life behind. You come to work to work. But you can't really, can you? You bring yourself wherever you are. And how you see the world, what's important to you, affects how you choose to do your work and what work you choose to do. So it's important to understand what it is that's important for you, because that'll allow you to be guided in terms of which direction you take, which decisions you make, and how you go about achieving those goals in life.
So what I'd like us to do is to spend a little time thinking about this idea of personal purpose.
Purpose is something that connects you to something larger than yourself. Purpose is not about purely self-indulgence or self-focus. Because if it is, then it's not really purpose — it's just a goal for self-satisfaction. And that in itself cannot really be a purpose because it doesn't make any positive impact on the world around you.
How many of you have a guiding purpose? Raise your hands.
Student: Try to make as much money as possible.
Okay. So would you agree that that's a purpose? I wouldn't. The question I would ask you is: why? What are you going to do? So you have all this money. If your purpose is to make as much money as possible, then that's fine. All you need to do is what it takes to collect money. So then you have all this money — what are you going to do? Put it in a bath and swim in it? What are you going to do with it? Why do you collect that money?
Student: Because in the process of accumulating wealth, you have to be better at your current self.
Really? I don't see that with many billionaires.
Student: Maybe you can live without concern. If you reach enough money, you can do whatever you want without concerning.
Sure. That's fine. But the question is: what is this "whatever you want"? That's the question I'm trying to get to. You collect all this money. You're free to do whatever you want. What are you going to do?
Student: Make yourself happy.
So that's an interesting one. Make yourself happy. Great point. We need to explore this a little deeper.
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How many of you have read Alice in Wonderland? So you remember this piece where she meets the Cheshire Cat in the woods and he says:
"Would you tell me please, which way I ought to go from here?"
"That depends a good deal on where you want to get to."
"I don't much care where."
"Then it doesn't matter which way you go."
"So long as I get somewhere."
"Oh, you're sure to do that," said the Cat, "if you only walk long enough."
Now, talk about making money. You could make money in a hundred different ways. You could start a hedge fund, be a VC, go into investment banking. The best way to rob a bank is to be a banker. So the question becomes: which direction are you going to take? Where do you want to end up? Because if you want to end up being wealthy, so you end up there — and then what? You've spent a huge chunk of your life collecting wealth with no idea of what you're going to do about it or with it.
And I can tell you, I know this from personal experience. When my father retired from work — he didn't have to work after 65, but he kept working. As soon as he stopped working, he basically lost his purpose to live. He stayed at home. He watched TV shows that he liked, but he died pretty soon after that because he just didn't have a purpose for waking up in the morning. So once you've made the money, then what? You'll feel secure. Then what? That's the question that we try to answer with purpose.
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Let me share something with you. This was a really interesting experiment that I think responds to what you're talking about — making money and being happy. What does that happy look like?
The video clip shows a rat with an electrode implanted in the lateral hypothalamus, which is the part of the brain that controls basic drives such as eating and drinking. The experiment was like this: they attached an electrode to the part of the rat's brain that experiences pleasure — because pleasure is just a brain function, something that happens in your brain that tells you that you are feeling good. The rat accidentally pressed the button that clicked that pleasure center, and decided that nothing else was important — not eating or drinking or anything. Just pressing that button to feel good.
So my question to you is: if I gave you that opportunity — I'll give it to you free — you sit in a chair and you can press that button as often as you want, and every time you press it, you feel better than anything you've ever felt. Is that the life you would choose? You're talking about happiness, right? Would you choose this?
Students: No.
Why not? You're happy, right? So if you're happy, what more do you want? Why isn't this a good choice for you? I'd love to understand, because that's what you guys mentioned.
Student: It doesn't give you meaning.
Okay. But meaning is not happiness, right? So there's a difference between meaning and happiness, and you want both.
Student: For me, I want meaning more than happiness.
Meaning more than happiness. Right. In fact, if you're interested in reading about meaning, there's a great book that I read when I was studying psychology by Viktor Frankl, who was in the concentration camps. He wrote a book called "Man's Search for Meaning." It's a really powerful book that tells you about how powerful meaning can be to make your life more satisfying.
Student: I think happiness and pleasure are different.
Happiness and pleasure are different. Explain.
Student: Pleasure is just when you get the dopamine hit — when you eat something good or delicious, or when you do something. But happiness is more meaningful for me. If you do something that is purposeful, it can also give you happiness as well.
Great point. I've always been sort of amused by the U.S. motto of "life, liberty, and the pursuit of happiness" — like you can hunt it down, shoot it, put it on your wall, and that's it. You chase happiness, you become happy.
There's some great work done by a Hungarian psychologist who worked with Jung — his name is Mihaly Csikszentmihalyi. Don't ask me to spell that name, I can't. But he wrote a book called "Flow," which is exactly this idea that Rin mentioned — a feeling of personal satisfaction from doing something that is meaningful to you.
If you think about a violinist playing in a concert, doing their solo — she's standing there and she's playing and she's not thinking, "Oh, I'm so happy." She is so involved in what she is doing that nothing else really matters. That is her focus and she is present — she is in the now. He describes that as flow, which is the type of happiness that is more long-lasting and more meaningful.
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It is about pleasure, right? The example I usually give: say your pleasure is food, and for you, what you really want is to find the best-tasting ice cream in the world. You search around the world and you try it. Thailand doesn't have it. You go to Europe, to the U.S. Eventually you find yourself in a little town in Italy, in a little gelato shop, and you taste this ice cream and it is the best ice cream you have ever tasted. It makes you feel you have reached your goal. You have found your nirvana of ice cream.
So you decide: now that I've found it, I must move here so I can have this ice cream all the time. So you move there. Next day you have the ice cream again — still tastes amazing. Next day you have the ice cream again — still tastes pretty good. You have that ice cream every day for a month. Do you think it still tastes exactly the same as it did the first day? No. We are creatures of habit and we get habituated to stuff. It doesn't mean as much anymore.
That is why purpose and meaning become really important — because that's something that you can continually work towards. It's never something that's finished. It is something that you do, think, and be that allows you to achieve personal happiness.
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There are many benefits beyond that of having a clear purpose. The research shows you can make better decisions because if you know where you're going, you know which direction to take when you're faced with choices. And if strategy is about choices, you need to know which choice you should take, which is better for you. You can achieve your goals faster because you're going in a single direction and not going all over the place. And when we talk a little bit about delivering and executing strategy, we'll talk about how you can try and align your goals. It boosts your health and makes you happier. So that's why I want us to start with this before we go into vision and mission.
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People have different types of visions. Does anyone know who these two women are? Oprah. And the other one — not so easily recognizable but also very famous — Arianna Huffington, who started the Huffington Post and built a media empire.
"To use my gifts to cultivate the self-worth and net worth of women around the world."
"To be inspiring to my students, to be more than they thought they could be."
This is about other people. Purpose is about other people. But it doesn't have to be so big. It can be something quite small. "To motivate and inspire others to live a healthy life." You could be a personal trainer and that could be your purpose. And I would rather have a personal trainer who has that as a life purpose than someone who's just there to make money. Because if they're just there to make money, I wouldn't know whether they're just giving me exercises and more stuff to do because they want to keep me paying them, or if they're actually trying to make me healthier.
This particular list of four encompasses some of the main types of purpose. I'd like you to think about whether any of these resonate with you.
DISCOVERY — Discovery centers on the search for the new, an insatiable curiosity and a relentless quest for knowledge and innovation. You want to learn new things. You're just curious. You want to find out stuff. A person like Leonardo da Vinci, who was just interested in everything. He is basically the role model for what they call a Renaissance person — someone who's interested in everything, learns everything, is curious about everything, makes connections. Six hundred years before we could fly, he designed a potentially workable helicopter in ancient Italy.
EXCELLENCE — Focusing on being the best. I think Ty, you mentioned that — being the best at something. Someone like Serena Williams: "I want to be the best at this and I'll do whatever it takes to do that."
ALTRUISM — Focused on helping others, people in need, just sharing your skills and your knowledge to help people live a better life. Oskar Schindler — you may not recognize the face, but you probably know the name. He was the man "Schindler's List" was based on. He was a German who helped thousands of Jews escape the Holocaust by smuggling them out through his company.
HEROISM — Setting the standards for everyone else. This is about justice, doing the right thing. For me, Nelson Mandela stands out. He's the only one of these that I've met because I grew up in South Africa. I was very fortunate to meet him.
So of these four, do any of these resonate with any of you? How many of you are interested in discovery? Is that something that gives you satisfaction? Quite a few. Wonderful. How about excellence — to be the best at what you do? To be better. Better than you are now. If you follow really good sports coaches, especially in athletics, you're not competing against other people — you're competing against your best every time. You're just trying to be better. Altruistic — who wants to help other people? A few altruists here. Heroism — who believes justice is the most important thing, doing the right thing?
So think about what that means in terms of how you choose what you do in life. How did you end up in the work that you ended up in? Some of you ended up in it because it's your family business. But what are you going to do with it? How are you going to make it meaningful for you? I know many family business heirs that don't want to take over the family business. It doesn't resonate with them. It doesn't feel like something they really want to do. Now, you can sell the business and find another business that satisfies you, or you can find a way to make that business do what you want it to do. Because business is malleable. Business is flexible. You can do a lot of things in multiple different ways that will help you try and achieve that sense of purpose.
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I think you're all familiar with this little framework of Ikigai. This is the Westernized version — a very superficial expression of the Japanese concept of Ikigai — but it's a nice framework to look at just as a start. It talks about four dimensions in terms of purpose: what is it that you love? What is it that you're good at? What does the world need? And what can you be paid for? If you have all four of those things, then you are probably in a place where you're doing well and doing what you believe is good for you. And it is possible to have all four of those things. You don't have to be a millionaire or a billionaire to achieve that. You can achieve that with very little resources. It's just about finding those four things.
The reason I use this model: the two parts on the top — what you love, what you're good at — that's very personal. But the other stuff really fits in with what is your business's purpose. So you've got what you love. Can you convert it into that second part — there's a need for it and people will pay you for it?
There's a guy that I met recently who's involved with a couple of my friends who are investors. He started an app called the Sati app. The app basically connects you to counselors — people who are trained to listen and help — like a hotline for psychological wellbeing. When you're feeling really bad, you can phone them and someone will be connected to you and you can talk to them. He did this because he was in that same situation and there wasn't any resource in Thailand. Thailand doesn't have a lot of psychological wellbeing resources. Naturally — what do people do when they're feeling bad? Go to temple for a while or talk to your friends. There are psychology programs all over the place here, but there aren't that many roles for psychologists in the broader society. So he tried to create something that would have helped him, that allows him to help other people.
He found what he loved, what he was passionate about, what he was good at, and he turned it into a business. Now the business is not necessarily there to make lots of money, but it should make enough to give him a living and to keep itself self-sustaining. And that's probably what you would call a social enterprise. Not everybody's into the social enterprise side of things, but you can do it in normal corporate life as well.
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So I want to show a short video about someone who found their purpose through life. I'd like you to think about what that might mean for you.
[Video transcript: A father tells his story. He received a phone call after the second scan, screaming out loud that it was going to be a baby boy — he was over the moon. His son came into the world in an awkward position. A particular kind of blood clot formed in his upper arm. He was told: "You've got about two hours before the limb starts to die." His son didn't stand a chance to keep his left hand. When his son came home from the hospital, his left arm was no longer moving at all. That wasn't good enough, so he decided to do something about it. He rushed into the kitchen, took a kitchen sponge and tacked it onto his son's arm lightly. Within ten seconds, his son lifted it up, banging the toys. From that day onwards, he was using both arms. His heart just lifted.
He reflected: if someone had told him two years ago that he would be an engineer by profession, he would have looked at them and told them they were mad. But there has never been a better time to become an engineer. He had seen lots of stuff about kids rejecting prosthetics because it had been left too late, and that spurred him on to try and do something himself. He started making rudimentary sockets with off-the-shelf components — washers, a screwdriver handle, gluing bits of plastic and tubes together. But he realized the cheapest way of doing all of it was 3D printing. He came to a university to see if he could get some help, wanting to completely slash the costs and reduce the time.
He trialed a process of film scanning: parents use an Xbox Kinect scanner to scan their child's limbs, send him the file, he models a socket and mails it out with a test fit. If it fits snugly, he can send them the whole prosthetic arm. The same process is now being tested with twenty families around the world. He thinks this is the shape of the future. When he got the socket fitting and the arm was the right size, he took the blue arm into his son's room and it slid onto his stump. His son actually said the words: "It fits properly." And he just wanted to go to school and show it off to all his friends. That's when he knew he'd done it right.
He would love to come back in time and focus on engineering. There has never been a better time to think of becoming an engineer. If you have an idea and you have the motivation to do it, then you can do it. You can change the world.]
Any thoughts? He is living the Ikigai. How do you think he got there? He was never an engineer. That's the thing, right? He just did that because he wanted to help his son. And he realized that if his son did not use his arm for the first few months, he may never get used to using it. So he had to do something to get him to use the arm. That's why he started using the sponge and everything — just so his son could feel that when he moved his arm, something would happen.
And then through that, he went into this engineering thing because he went to the university and tried to figure out how to do all of this stuff. And then he realized that there were many people — like he says, in South America, children are not given prosthetic arms until they're teens. By that time, they may not even know how to use that arm anymore. And it may be too late. So he decided to try and help. And he used what? An Xbox to do 3D scanning.
This is just to show you that purpose doesn't have to be something huge at the beginning. You don't need to try and change the world. But it has to be something that gives you meaning — gives you a sense that you are doing something meaningful in the world, not just for yourself. So that's why I wanted to highlight this idea of purpose.
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So what I'm going to ask you to do is: forget about the full Ikigai for now. Have a conversation about these two things — what you love and what you're good at. Don't worry about the other stuff. We'll come to business purpose later. But think about: what is it that really drives you? What wakes you up in the morning? What makes you want to get up and go to work — or not go to work?
So you have to go to work. Sure. Those may be some of the external drivers. But what is the internal? If you had the choice to do only one thing, or to study only one thing for the rest of your life, what might that be?
So ten minutes. Have a conversation. You can do it in little groups — probably groups of three or four at most, so everybody has a chance to speak. Or in pairs, that's fine. Just have a conversation. I know this may be quite deep, right? It's getting you to think about what's meaningful for you. But I'd like you to just start thinking about it. If you don't have it, how would you go about figuring it out? Go for it. Ten minutes.
[Group discussion — approximately 10 minutes]
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Okay. Wrap up your conversations. So what did you learn about your purpose and your Ikigai and your passion? Does anyone — yes, Pin.
Pin: I think it's something subjective. From what we three were discussing, what we love, it's actually not the objective of things. For me, I like to see people around me have their improvement in life, success in life — that's what I actually really love to see. And Pin, she wants to connect to people and really understand them as them being them. That's what she loves. So I think it's something that doesn't have to be objective.
Professor: Well, purpose cannot be objective. It has to be subjective because it's a very personal thing. And what you see as your purpose may be very different from someone else. But that's where you have to start. You have to start from within. It has to be something that's meaningful for you. And what's meaningful for you may not be meaningful to anyone else around you. But that's okay because you're the one that's responsible for it. So your passion is helping people be better. How does it link — do you think you're good at that?
Pin: I think it also ties to my way of choosing my work and my life. I've been always choosing the work that I would be able to make impact in a broader scope of work. So if I get to do something that's impactful, meaning that there's also people who also get to improve themselves around me.
Professor: And you do that for work?
Pin: Yeah.
Professor: Great. So you have all of those things. So you have Ikigai. Do you feel like you have it?
Pin: Many times I do.
Professor: Excellent. Thank you for sharing. Anyone else?
Han: My main purpose is actually very personal. I want to support my family, especially my daughter. So that is why I'm working and to earn money. But I don't know — fortunately, I enjoy and love my job now and I really enjoy that. I'm now working at life insurance. Before that, I was at the bank. I'm also good at, enjoy seeing the numbers. So I think I also found myself in passion. Starting from the purpose, then I start doing, to be responsible for the family. Then I start finding myself enjoying the work as well.
Professor: Yeah. Wonderful. I mean, it doesn't matter what work you do.
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For me, I very much like Pin — I want to make other people be the best versions of themselves. I eventually found that this is what I really enjoy doing most. But when I started, I studied as a psychologist. I trained as a clinical psychologist. I was doing therapy, helping people one to one. But I wasn't that satisfied with it. I could do it fine, but somehow it felt like too much investment for too little gain for other people — especially because I was working in the largest psychiatric hospital in South Africa, where people would come in, they would get treated with medication, get a little bit of therapy, sent out. Three months later, they were back in again because there's no support outside. So it didn't feel like I was making a difference.
But at the same time, when I started working for an insurance company again in South Africa — it sent me from Cape Town to Boston to London, where I ended up, and eventually I left and came here — what I found with my role was talent management, which seems very far removed from insurance and feels very far removed from doing anything meaningful to help other people. Yes, I could help the people within the company get better jobs and do okay. But what I realized was: this was at the time the largest insurance company in the country. Fifty percent of households had life insurance from this company. And what I felt connected to me was: I was responsible for making sure that we had the best people in the top roles. I was responsible for the top two hundred roles from an HR perspective, making sure that we had succession and so on.
For me, I really felt like if I could help get the right people into those jobs that would do a good job for the customers, I felt that was my contribution to the people who were getting the insurance from us. There was an incident — when I went back there a few years ago doing consulting — they were talking about a situation where one of the big types of insurance in South Africa is funeral insurance, which is supposed to, if someone dies, the policy immediately pays for the funeral because it can be expensive. There was an incident where, because the company had not paid out someone for the insurance immediately when they needed to do the funeral, their family took the dead body and dropped it at an office of the insurance company. Just dropped it off there and said: "Well, you deal with it."
And you can imagine how much stress and anxiety and trauma that family must be feeling to do something like that. So for me, if I could make sure that doesn't happen because we have the right people in the company, then I feel like I'm doing something right for a much larger group of people, even though I'm not directly involved. So for me, I felt like I was able to satisfy all of those things.
But now, teaching for me is what I really enjoy because I feel like I get to see people develop and grow in the areas that they want to grow in — because they come here to choose to study certain things. For me, that is very satisfying. And it's nice that it pays me, but universities don't pay much. But that for me is not the most important thing. It's being able to do what I enjoy doing, and that adds meaning to the world.
For most of us, there doesn't have to be this one purpose that lives with you forever — once you've picked it, that's it for the end of your life. No. Han, you are very passionate about bringing your daughter up, taking care of her. Well, once she's 24, 25, you may need to find something else to do. But having that purpose now makes a difference because you don't just want to make money to take care of her physically — what you want is to bring her up to be a good person, I assume. And that also drives the decisions that you make because you want to make decisions that she will be proud of. That helps guide you in terms of the decisions that you make.
So all of these things fit together and it's not as clear cut as, "Oh, I have to have a passion and I have to have a job that fits." No, you can find these interconnections in anything that you do.
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When I was studying at university and started my career in teaching, I had a lot of friends who were professional ballet dancers. We were in a very small town, but surprisingly we had a ballet company because we were in what was then a homeland of South Africa. Dancing doesn't pay a lot of money. And by the time you're 30, your body's going to be... I don't know. So how do these people whose passion is dancing and movement — how do they shift from doing that to doing something that not only allows them to fulfill their passion, but also use what they're good at and make money?
You don't just start your own dance company because your body is not capable of that anymore. So what do you do? They went into Pilates training because they had been using Pilates — it's very good for people with injuries and so on. And they found that they could do those movements, they could show people how to do those, and they could get satisfaction from doing that sort of work, which became quite popular. And a lot of people made money from that.
So it's not clear cut. You can always find a way to find something that's meaningful for you, even in what seems like the most difficult jobs. I hope that this gives you a chance to start thinking about what your purpose might be and how you can live in a way that satisfies it.
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So once we have our personal purpose, let's talk a little bit about what that means from a business context. You start with your personal purpose. You then move on to what is your organizational purpose — what is the collective reason for this organization to exist? What is it trying to do in the world? Then you come onto the strategic purpose — what allows you to make the choices that allow you to achieve the organizational purpose. That's why I say strategy starts with purpose.
When you think about aligning your strategy with your purpose: does your strategy authentically express your purpose? And do individual leaders see personal meaning in the organization's direction?
I did a lot of work before COVID around Asia and in South Africa for Unilever. At that stage, they were revitalizing their leadership values. They sent every leader through a workshop on personal purpose — what's important to me. And the risk there is: someone finds their personal purpose doesn't fit with the organization and they leave. But isn't that a good thing for both the organization and the person? If their purpose doesn't fit. But most people found that if the organization supports their personal purpose, they were very happy to address what the organization was trying to do. So it's important for us to see a link between these two.
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PATAGONIA — How many of you own Patagonia clothing? You know, there's a lifetime warranty. You can send it back to them, they will fix it and send it back to you. Lifetime warranty — which is very different from most clothes retailers. They want you to buy something that will wear out or that you'll throw away within a year so you'll buy some more. So you can see that Patagonia has a very different purpose than most other clothing companies, which to a large extent are about purely profitability and don't really have a purpose. And Patagonia is the one that will survive.
In fact, the founder of Patagonia passed away recently and his children gave up all their shares to a trust that is focused on climate change. They gave up the company. I can see most of you think, well, I would never do that. But how much money do you need to live a happy life? There's something to think about there.
NVIDIA has a more tangible purpose of accelerating computer performance. And that drives the strategies of the companies that they partner with — whether it's the AI companies or the computer manufacturers. For them, their passion is excellence at this. So the people who join Nvidia are the ones who really want to be good at what they do.
STUDIO GHIBLI — Anyone know who this is? Hayao Miyazaki. He founded this company. What do you think he wanted to do with it? Do you think he wanted to make cartoons to make money? They do very well — it's the only foreign company whose film, I think, was the first animated film that won best picture or best foreign film. "The Boy and the Heron," which was really about his life. What he wanted to do was to be able to tell stories that connected with people, that represented his culture and his history, and also that would represent the human experience. And he was very much an environmentalist — but he doesn't hammer that in you like Disney does: "This is the moral of the story. Be nice to plants."
If you watch a lot of his films, there's one of my favorites called "Princess Mononoke," which is about people in the forest and evil spirits and all of that. And if you watch that, you realize that it's not about "nature good, humans bad." Everybody's trying to survive. And sometimes it's difficult to survive together because you have contrasting interests. But there are ways that you can work together. It's not simple or clear cut, but what it does is highlight this idea that it's important for us to think about nature as an entity that we need to take care of.
Whereas I watched a Disney movie called "Ferngully" many years ago in the eighties or nineties, which was also environmentally themed, but that was like, "Oh, humans are bad and the nature spirits are good" — which puts you on the back foot already as a human being. Why am I so bad?
So Miyazaki wanted to translate his vision through his studio. That's why this studio has done so well. The sad thing is his son, who has directed films, does not want to take over the company. He's been promising to close it down, but I think he recently sold it to another big Japanese media company. So we'll see what happens. But will the movies be the same? Probably unlikely, without that driving vision. He wasn't an easy person to work with — there was a French filmmaker who followed him around for twelve years and made a documentary about it. He's a difficult man, but very passionate about telling his stories in a very specific way.
I can feel sorry for his son. His son was under his shadow for a long time. And as a child of someone who has done so well, how do you make a name for yourself, make an identity for yourself? That's an issue with many people in very successful family businesses. You can just take over and run it as it's run, but how do you put your identity into it? How do you build something meaningful for yourself within that framework?
And you don't have to be a creative to find purpose and make it work in a company successfully and profitably.
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In the early 2000s, the biggest bookstore chains in the U.S. were Barnes & Noble and Borders. They had hundreds of branches around the country. And by the late 2010s, Borders had closed down. It was gone. Barnes & Noble was shutting down hundreds of stores around the country. And they were desperate. What do you do?
Why was that the problem? Well, because suddenly you could buy off Amazon. You don't even need to go to the bookstore — buy your book off Amazon. So how does a bookstore survive in an age where you can buy everything off Amazon at 20, 30, 40 percent cheaper? What do you do? What are you selling then?
It's like the question: what am I doing here? All the information that you need to be a good strategist is in the textbook. So if I come here and parrot the textbook back at you, what's the purpose of me? Nothing. So what is it that a bookstore can contribute that is different from what you can get from Amazon?
This was 2009, 2010 — a huge drop in shares. Things were looking really bad. At the end of 2018: seventh quarterly loss in a row, losses of $27 million on sales of $117 million, fired its fourth chief executive in four years, and it had closed 98 stores, shrinking its retail from 726 to 630 stores. So things are not looking good. It's a dying industry.
Would you agree that bookstores are a dying industry? Would you agree or disagree? I buy a lot of books off Amazon. How many of you buy books off Amazon? How many of you don't buy books at all? I know that there are many people these days who are very proud that they don't read books. "I don't read. Why do I need to read? I read Facebook, Instagram. I learn everything I want on TikTok. Why do I need to read?" Even within the broader environment of the world, people don't read as much. So why don't they just close down?
This is what the store looked like in the mid-2010s. What do you notice? Can you tell this is a bookstore? They were selling everything because they were desperate. They didn't know what else to do. People were not buying books from them, so they started bringing in toys and stationery and this and that and the other thing, trying to make people come into the store. But there's a problem with that — because you can get all of that stuff somewhere else as well. Why would people come into a bookstore to buy toys?
So they were in severe turmoil. And then they hired this guy who was an investment banker in London. His name was James Daunt. And they didn't hire him because he was an investment banker. They hired him because when he left investment banking, he set up a bookshop in the UK. It looked like this: Daunt Books. Very different from what Barnes & Noble looked like. And he made it very successful, even with Amazon being around as a competitor. After he did this, Waterstones, which was a big bookstore chain in the UK, brought him on and he turned them around. And eventually, after he did that, a VC company that bought Barnes & Noble hired him to come and take over.
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[Video transcript — PBS NewsHour interview with Jeffrey Brown:]
"The key insight that I have is that it is about the bookselling team and it's about how you take all of this huge number of books and arrange them and display them in a manner which really engages with your local community. The insight that gives me in terms of running lots of bookstores is: leave it to the teams in each store. And your stores will become better and busier and the business will thrive."
Barnes & Noble's beginnings can be traced to 1873, but it was in 1971 that Leonard Riggio acquired its trade name and flagship Manhattan store and grew the company into the nation's largest bookseller, offering steep discounts and a huge selection. Eventually, with more than 700 superstores, all were stocked with the same titles and design. Success, along with Borders, put hundreds of smaller independents out of business, captured in Nora Ephron's 1998 film "You've Got Mail." But Amazon, offering even steeper discounts and more supply, nearly killed off Barnes & Noble, which by the time Daunt arrived had closed hundreds of stores around the country.
"Obviously, we've come back from the brink."
"The brink meaning the end?"
"Yes. The business was a public company. It was sold really pretty much for the value of the books that were sitting on its shelves. So that's not a really very good sign of health. The job that I had was to restore it as a bookseller."
Daunt brought an unusual pedigree. He launched Daunt Books in 1990 as an independent bookseller in a gorgeous London setting that became a destination for book lovers. In 2011, he was hired to rescue Waterstones, Britain's largest chain bookstore, then near bankruptcy. And in 2019, after hedge fund company Elliott Advisors bought Barnes & Noble, to attempt the same here.
His successes gained attention as in recent years, Barnes & Noble began to open stores all over the country, even reopening a flagship Washington, D.C. store that had closed in 2012. The new philosophy: have stores act and feel like an independent local shop.
Victoria Hardy, assistant manager at an Upper West Side Manhattan store, has worked for Barnes & Noble for more than ten years. These days, Hardy and her counterparts see themselves as curators of individual tables and shelves, as well as the store itself, paying more attention to local consumers and to social media — most of all, TikTok's BookTok.
"It was a lot of young readers, almost this generation that was coming into physical bookstores looking for books. So what I started to do with that was look at those titles, like what they were coming in for, and how do you take that one title and curate a display around it? What are those books that are similar, pairing them together and creating a bigger display from it?"
So fervent in his approach is Daunt that he makes Amazon, which today accounts for more than 50% of the market, sound like an ally.
"I actually see Amazon as being a massive positive for what it is to be a great bookseller."
"How can it be a massive positive if it's taking 50% of the market?"
"What it's taken is all the boring books out of our stores."
"But surely people go to Amazon for more than just what you're calling the boring books?"
That strategy applies to the nation's independent bookstores too, of course. In fact, Barnes & Noble recently acquired one of them — Denver's much-loved but bankrupt Tattered Cover. A move being watched closely, locally and beyond. It is a business, though, and Daunt has to answer to the company's owners. A plot of this story is still being written.
[End of video]
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My favorite bookstore is probably the Kinokuniya in Orchard Road in Singapore, because it's just so well laid out and it's got such a huge selection. The ones in Thailand are also pretty good. I went there and I was looking for a book and I started chatting to this guy who was stacking the shelves in the science fiction section where I was looking. And he said, "Try this one." And it was one of my favorite books. It's the only science fiction book that I have read that won both the major science fiction awards and is set in Bangkok. So if anyone is interested in reading that, it's called "The Wind-Up Girl." Very, very good. You can find it at Kinokuniya. It's set in the far future in Thailand, in a post-oil world.
So anyway, strategic vision is important. You need to have an idea of what it is that you're trying to create. What sort of difference are you trying to make in the world? And you can see how Barnes & Noble, when they first came out as a chain store, they took away business from the small independent booksellers. A lot of them closed down, which was terrible. And now they're trying to partner with them. I don't know how that'll work, but let's see. But we do know that people want bookstores — that you cannot just live on Amazon alone. So there's space for all of these things. And he found the space in the industry where he could do well and make a good business. And that's basically what you want to try and do: have a vision that you can translate into a mission that will give you sustainable competitive profitability over the long term.
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So let's have a look at some visions. Whose is this? Whose vision is to make people happy?
Students: Disney.
Easy one, right? How about: "Our vision is to create a better everyday life for many people"? This one's in the textbook.
Students: IKEA.
So when you look at these companies, think about: are they achieving their vision? "A just world without poverty." This isn't a company — this is a charity organization, Oxfam. But they have a very clear picture of what they want the world to be, which fits very well with the sustainable development goals as well these days.
Amazon, without a doubt. I used to buy stuff off Amazon in South Africa. In South Africa, the post office is not as good as the post office here. Things go missing — sometimes accidentally, sometimes on purpose, I think. But if something went missing and I didn't receive it within the time that they said it would arrive, I sent an email to Amazon. And I got an email back saying, "We have sent you another copy." That's it. No questions. No "are you sure," no "you have to pay again." Nothing. And it cost them maybe about twenty dollars every time I lost a book — which was about three or four times out of ten years of buying stuff. But that hundred dollars that they spent — and it wasn't even a hundred dollars because it cost me twenty, it cost them about five — that made me a loyal customer for life. Because they were focused on my experience, not how do I make myself a little bit more profitable as a company. Because they understood the bigger picture.
"A computer on every desk and in every home." This is a very old one.
Students: Microsoft.
Now, let's change: "To help people and businesses throughout the world realize their full potential." I'm not sure they're actually achieving that. I feel quite constrained by Microsoft Office, I can tell you.
"A world where beauty is a source of confidence, not anxiety." Very good. Which is a brand of which company?
Students: Unilever. Dove.
One of their many brands.
These are strategic visions that tell you how you should be thinking in the organization when you are making decisions. Take Disney — to make people happy. If you go to Disney World, the staff there are not allowed to take their costumes off in front of the children, because they do not want to spoil the image that children have of these characters. In fact, many companies send people to Disneyland to learn about customer service.
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How many of you know your company's vision? Anyone? Wow.
Employees who find their company's vision meaningful have engagement levels of 68%, which is 18 points above average. We'll talk about engagement when we talk about execution. But engagement is about how committed are you to the work that you do. The more committed you are to the work, the more meaningful you find the work, the better you will do the work. If your people are not committed to your vision, you are not going to get 100% from them.
There's what they call discretionary effort — effort that we give beyond what's required. The normal effort that we give at a job is: "I'm being paid for this. This is what I'll do. It's in my job description." But what if you're asked to do overtime and you're not getting paid for it? How willing are you to do it? If you don't believe in what the company's doing, you're probably going to say, "No, listen, I've got my family to go to" — if you're not scared of being fired. If you believe in the vision, then you're far more likely to commit extra effort to doing what needs to be done to achieve that organizational vision.
Does anyone here know their company's vision? How many of you are in companies that do not have a formal vision? Family businesses, startups.
So family businesses, because they run very closely, generally a vision is not articulated. But it might be useful, if you have a lot of people working in your family business or in your startup, to try and understand and articulate what that vision is. In a family business, maybe just talk to the founder: why did you set up this company? Yes, there was an opportunity to do this or that, but what do you want this company to do? What do you see the future being like for this company? Try and articulate it, because if you can communicate it to people in the company, it becomes much easier to get them aligned to the overall goal that the company is trying to achieve.
Startups should have a vision, because otherwise why are you starting the company? You've got to think about what it is that the company wants to contribute in the world in order to make money. That's the connection you would need to think about as a startup. And yes, you're right — most startups don't even think about this stuff because it feels too soft and fuzzy and doesn't really address the tangibles of using up your runway in time and achieving your goals. But it's very important, especially over the longer term, to understand what is the basis of your company's existence.
If you're in a corporate, go and find out what your company's vision is. Think about whether you agree with it or not, whether it resonates with you. Does it make you feel, "Oh yes, I want to work for this company"? And it doesn't have to be a hospital where you're curing people of deadly diseases or a psychologist or anything like that. You can be a bank, you can be an insurer, you can be an automotive company. Just think about: what is it that you're trying to achieve? It doesn't have to be changing the world. It can be just focusing on your immediate community or market that you're working in.
For me, it's quite important to understand what your vision is. A lot of visions are just a bunch of statements about what the company is, what the company wants to be. But actually, what a vision should be is: how is the existence of this company and the work that it does going to change the world? What is it going to do? And when I say "the world," I don't mean it has to change the whole world. What are you going to do to make the lives of the people that you serve better? That's basically it. Are you making them more efficient? Are you making them happier? What are you doing? It's a snapshot of a future state.
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This one is quite a nice one. John F. Kennedy's: "I believe that this nation should commit itself to achieving the goal, before this decade is out, of landing a man on the moon and returning him safely to earth."
That's what we want to do. We want to land on the moon. Does anyone know when the last time a human being landed on the moon? We're trying now. Do you remember when it was? '72. Can you imagine that? Fifty-four years ago was the last time a human being landed on the moon. And at the time people said, "Oh, we landed on the moon, now we're going to go colonize it." None of that happened because the passion to achieve that dissipated because of the Cold War and all sorts of other stuff. But this vision that he created for NASA was so powerful that when Lyndon Johnson, who became president after Kennedy's assassination, went to NASA and was talking to people, he came across a janitor who was sweeping the corridors. And he said to the janitor — asked the janitor, obviously a very stupid question — "Hello, sir, I'm the president. What do you do here?" And he assumed the answer would be, "Well, I'm the janitor, I clean the floors." But in fact, what this guy said was: "Mr. President, I'm here helping to put a man on the moon."
He really understood that sweeping the floors was an important part — making sure this place was clean was an important part of getting Neil Armstrong to the moon. Do your people in your company understand how what they do serves the bigger goal that you are trying to achieve? And if you don't know it, they won't know it. So you've got to be clear as a leader — you've got to be really clear what it is that you are trying to achieve with your business. Because if your only purpose, as you see it, is revenue generation, you are far more likely to make errors in judgment about the type of decisions that you take and the things that you do, because you don't have a clear focus. Money can be made in a hundred different ways.
But if your purpose is to provide high-quality luxury condos for people, then the decision between buying material that is expensive but high quality and cheaper but lower quality becomes clear. You have to buy the high quality because that's what you want to do. And I don't think many — we've had quite a few people from real estate development companies in these classes — but I don't think many of them really follow through. They say it, but... I mean, when I bought my condo here, I knew that I did not want to buy anything less than ten years old because everything that's been built in the last ten years, the walls are thin. They cost twice as much because they knew that they don't last as long. But the focus of real estate companies has become purely short-term profitability. So they don't build for the long term.
And in fact, it's not just real estate companies. Most consumer goods companies have worked to create what we call deliberate obsolescence — which means something that could last ten years is designed to last two. In fact, one of the first light bulbs ever made of the type that we have today was made over a hundred years ago and it's still on. It's still on. There's actually a webcam now where you can watch it. So why is it that you have to buy new light bulbs every couple of years? Because they're designed to fail.
So vision should be aspirational. It should be compelling. It should be directional — something telling people where you want to go. And it should be shared. Other people should know about it, because otherwise they won't know what they're working towards.
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How does the language affect your vision? Here's one: "Our vision is to be a leading tech and innovative conglomerate, providing food for both body and mind that creates shared value and brings health and wellbeing for all." What does that sound like? Does that sound like something that would make you passionate? "Oh, this is what I want to do!" Like Disney: "I'll make people happy." Sound good or not good? Does anyone know whose this is?
Student: I think one of the six core values — the first one — inspires me more. I think it resonates with a lot of people more. That's why we're doing business: to serve three main groups. The first one is the country that we operate in. Second is the people — our customers and the people we hire. And thirdly is the business. So I think that resonates with many of our employees more than this word salad.
Professor: Okay. So maybe you need to tell them to make the word salad less salady.
How about this one? Even longer: "Our vision is to become a regional leader with a relentless commitment to driving innovative product services and solutions that meet the diverse needs of consumers while creating business success in accordance with the circular economy concept to contribute to the sustainable growth of each and every society and community where we operate with our passion to deliver better things under our promise Passion for Better."
Does anyone know whose that is? It's a word salad, like Chad said. It's a bunch of words that sound very meaningful but don't really tell you anything. And it can be quite difficult when you're a big conglomerate that does multiple businesses, but you can have a very clear vision that can feed multiple types of businesses. Not that difficult — it just takes some thought and commitment. So think about what you want your vision to be for your company.
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Once you have your vision, then you need to turn that into something tangible in terms of business operations. And that's where the mission comes in. The mission is about how you are working now to achieve that picture of the future. A short summary of the organization's purpose, focus, aims — and it's a description of what the organization does to achieve its vision.
So if you look at the mission: Walt Disney — make people happy by entertaining and informing and inspiring through storytelling. They could make people happy by selling marijuana, I guess, or ecstasy or some other drug. But that's not their mission. Their mission is to make people happy by doing this.
IKEA — make the lives of everyday people better. So as many people as possible. A wide range of well-designed home furnishings at such low prices that as many people as possible will be able to afford them. How many of you have IKEA furniture in your house? Many of us. It's not just about people who can't afford normal furniture. It is high quality enough that most people would be happy to have something. In fact, I think there was some research done in the UK about ten to fifteen years ago that said something like 60% of children in the UK were conceived on an IKEA bed, because they sell so many beds.
Oxfam offers support in times of crisis. Dove looks at helping people with self-esteem, focusing on young people. Amazon is about continually raising the bar of the customer experience by using the internet and technology. For them, they create the best customer experience online. That's what they do. That's why they don't have physical stores. Although many companies have moved from online e-commerce to physical stores.
A friend of mine is one of the co-founders of Pomelo. How many of you shop at Pomelo? A few of you. Do you go to the stores to try the clothes on? It's a great thing, right? Because they started purely online, but they found out from asking their customers that their customers loved their online experience but wanted something physical. So now you can shop, try, buy — you order it online, they send it to a store, you try it on, and if you like it, you buy it. So you don't have to go through all the return process. You can actually go and try the clothes that you wanted to try. It's a great model.
So the question is: how do you achieve your vision? And the mission tells you how you achieve that. That's the translation into tangible action.
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Then you have core values. CP Group — you were talking about the six core values. What are the others? Do you know them?
Student: To be honest, I only remember the first one.
Well, why do you think that is? I'm not asking you specifically. Let me just show you a few seconds of this clip about how companies decide on their values.
[Video clip — parody of corporate values creation:]
"If your company does not have a set of hastily developed, insincere values, then you might be mistaken for a business without a moral compass. Companies love values, don't they? They're very, very important. So it's not surprising that there's quite a sophisticated technique that goes into determining what the values are for each individual company. Let's have a look at that process now. Step one: you get a facilitator to run an offsite workshop. Step two: you write down these five words."
Is this feeling a little bit real for someone? I've worked in multiple companies and I think that is how they do it. They just have an offsite. In fact, I've facilitated offsites like that. "Let's decide on the corporate values." What's the problem with that? Again, it's just words. So I don't expect your companies to have these written values that you put on the wall, because that means absolutely nothing.
In fact, the number of banks that have "integrity" as a core value makes me worry about banking generally. Because if you have to say it's your core value, I'm not sure I want to be banking with you. You shouldn't even have to think about the fact that you need to have integrity. Collaboration — all of this stuff. And despite having all of these things on their walls, most companies don't follow them in the decisions that they make. They are only useful if they guide the way you make decisions. If you talk about collaboration as a core value, then the work that you do has to ensure that people are allowed to collaborate internally and externally. But most companies will say "collaboration," but that just means "do what we tell you" and that's it.
Most companies struggle to make these things real. So I would not waste time trying to create a list of values. What I would do is, for your company and for yourself, think about what are the values that are most important to you. And we'll talk about this a little bit more when we talk about ethics.
By the way, do you guys remember the oath that you took when you joined Sasin? Anyone remember what it says? That's the tagline, but you take an oath. Anyone remember what that says? It talks about doing good — it talks about doing business in the right way and doing good. So if you don't even remember it a week after you took it, I'm not clear how well you'll be able to follow through with it.
Forget about the oath. Think about what is important to you. What is meaningful to you? How do you want to be known as a human being? Do you want to be known as someone completely ruthless who's focused on money? Sure, that's fine. Then that's what you do. Do you want to be known as someone who is collaborative and helpful? Then that's what you do. You've got to think about what it is that you want to be known for. Because the values are about how you behave and how you do the things that you're meant to do in your mission.
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We can look at the vision and mission of 3M — also a little bit complicated — "Advancing every company, enhancing every home." Again, a bunch of broad, generic words, really. But the mission statement is quite interesting: "To solve the unsolved innovatively." They've managed to create hundreds, if not thousands of different products — everything from types of bandages to types of sealant to types of tape, all sorts of things. They've done amazing work because they try and do things innovatively in ways that other people haven't. And that allows them to achieve what they have.
Shell — now they don't call themselves an oil company. They are now an energy company. They've broadened out and now they're moving into renewable energies and so on. The big bulk is still in fossil fuels, but their mission is to accelerate the energy transition while balancing energy security. So it makes sense to stay in the fossil fuel space while you are trying to push forward this goal. And then they have their core values.
So different companies have different approaches.
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What I wanted to ask you — just five minutes before we take our break — if you were to run a listed company that needed to have its values out there, what values would you choose? In fact, think about your own companies. What values would you want your company to live by? You can look online, you can ask ChatGPT, get a list of values. I want you to think about what's really important for you when you run a company. What is non-negotiable in terms of how you do things?
In the same groups that we were discussing purpose and Ikigai before — same groups — just have a quick chat about what you think the values might be. Take about five minutes and then I'll ask you to feedback, and then we'll take a break.
You can see values here: innovation, boldness, customer empathy, passion, honesty, integrity, quality, value, service, sustainability, growth, respect, developing employees — a whole bunch of things you can choose. What is it that's meaningful for you? For your company. Forget about the listed company. Think about your company. Five minutes.
[Group discussion — approximately 5 minutes]
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Before we take a break, what are the most important values that you came up with for the companies that you work for or run? Who would like to share?
Student 1: I think it's maybe not most important, but as I talked to a couple of people, the word that comes up a lot these days is integrity. These are like the new words that I think all people, even if they don't use this word, they are having these kinds of meanings in their values.
Professor: So how important do you think it is to have the word — or whichever similar word — in your values articulated?
Student 1: I think the word itself is already meaningful to people, but if the company wants to use any other words with the same meaning, I think that's fine as well. The main purpose of having "integrity" in the value is that they just want the customer or other stakeholders working with the company to be able to trust and think that they're up to something good.
Professor: So what does integrity mean for you, then?
Student 1: It means that you are accountable for what you're doing. If you get audited, or if you're going to be able to explain it in front of a lot of people, you can do that and you can sleep well at night.
Professor: Great. That's a very nice description. Because it's important to understand what you mean by these words. When I teach cross-cultural management, I talk about using words like "respect." If you are German, respect means you've got to be on time. When you say you're going to be there at eight o'clock, you've got to be there five to eight, because you're respecting someone else's time. If you're Thai, it means you defer to someone older than you — time is not that important for respect, because everybody's flexible with time. So respect can mean very different things for different people. These words are important to describe in such a way that you know what they actually stand for, for your company. Anyone else? What other words?
Student 2: I actually observed from my family business. I think the value is honesty. Because we serve good quality products. We never lie about what it can do to your business later on. So being honest, I think it's very important — and also for the internal employee as well. If they're honest about their work, the result is going to come out well.
Professor: Correct. Honesty, integrity — similar things, but slightly different focuses. What else?
Student 3: For me, if I have to pick one: perseverance. Because that is my type as well. If I set a target, I want to go and get it. So I also want to build that kind of culture in my company, where people will keep trying.
Professor: Wonderful.
Student 4: A bit similar to Han, but I think I've heard similar words — a bit different — which is "grit." It combines perseverance. I heard it recently from my mentor — trying to use a stronger word for encouraging the employees.
Professor: Great. So think about it. When you talk about things like grit and perseverance and integrity and honesty — if someone is not bought into your company's mission and vision, what is the likelihood that they will follow those values? Not so high, right? So that's why it's so important to have all three of those things. However you want to word it, it doesn't really matter. But it's important for you as the leader of a company to understand what those things are and how they fit together, so that you can communicate to people so they know what the right thing to do is in any situation and how to prioritize their decision-making.
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Think about call centers. I don't know if any of you have ever worked in a call center. It's a horrible way to make a living because you're sitting there on a phone for ten hours a day talking to people who are shouting at you and don't like you and don't want to be talking to you. They say "customer service — you need to be customer-focused." But your targets are: you have to do ten calls in an hour. What happens if one person wants to talk for half an hour because they have a problem? You're not going to try and solve that problem, because if your target is ten calls per hour, you don't want to be stuck on one call for more than five minutes. So you're going to forget about the value because you're focusing on your target.
So those two things also need to be aligned. How do you ensure that what you're telling people to do aligns with the values that you want them to live by? You have to be very clear on how these things link together.
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So how do you validate whether your values align with your culture? First of all, how does a culture come into being? A culture in an organization comes into being through the behavior of the people. If they are behaving aligned with the values, you can see that by the actions they take, what they prioritize, the decisions they make, and so on.
If the culture is not living up to the values, then what you have to do is either try and understand what the values of the culture actually are and whether you think those are good or not. You can evaluate that by seeing people's behavior. Are you saying that quality is one of your core values, but in fact, everybody is focused on speed of delivery rather than quality? That may be possible. It's not necessarily a bad thing, but it's not the same as what you want the value to be. So the question is: is that value okay? Is that what you want to do? Then you can continue with that and change the wording. But if you want people to focus on quality, then you have to give them incentives — not financial incentives, but structural incentives and support that allow them to deliver that value rather than the one that they're doing now. And that takes time and that takes mindset change as well as organizational change.
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Student: We don't have time to change a culture or set a core value. We need to change every day, every time. How could we sustain our core value and vision and mission in the changing world?
Professor: So the world changes. Does that mean companies have to change every day? Does SCB change its values every day? No, it keeps a core direction. It's about direction. Whatever happens in the world, your direction doesn't need to change because your direction is generally a human-based direction. You're trying to create happiness, or you're trying to work on self-esteem, or you're trying to work on convenience or efficiency. So yes, new tools will come along and you may want to incorporate them or not. You may need to adapt the way you do things, but how you behave doesn't have to change.
So if you can build a set of values that people can live by in that culture, part of that is the resilience to adapt to what is happening in the world and still do those things. Just because AI exists now doesn't mean I can't do the right thing anymore. I now need to do it with AI. So it's not about trying to change to adapt to the environment, but adapting to the environment within the framework of trying to achieve your vision — because the vision is a long-term thing, as your values are. Those shouldn't change. How you try and achieve them may change depending on what's happening.
For example, if speed of delivery is your core value that you need to give to your customers, then when AI comes along, sure, you integrate that because it helps you be faster. It doesn't change your business. It just changes how you do things using new tools. Does that make sense?
Think about it. Anything else?
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When we come back, we are going to go into the more tangible aspect of business — how do businesses work and make money? We've got the big picture now, and I want you to keep thinking about these as you think about your businesses. And if you can articulate them in your assignments, that'll be helpful.
Okay. Back at ten past. Is that right? Ten past. And then we finish at... five thirty? Five. Okay. So ten past. Oh, have we gone... one thirty-two? Oh, did we go two hours? I'm so sorry. I should have given you a break a long time ago. I apologize. I will — we will do one hour after the break. I'm so sorry about that. I just didn't realize because we started at one-thirty, right? Someone should have told me. You are welcome to tell me it's time for a break, please. Sorry to keep you so long.
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