By Marjolein Bakker & Peter Powell

“Guiding Principle: Any principle(s) that guide an organization throughout its life in all circumstances, irrespective of changes in its goals, strategies, type of work, or the top management.”

Ever heard the phrase “values are to be lived not laminated”? It’s perhaps more relevant than ever, with many organizations trying to do more than simply make money these days. Business and business leaders are realizing that in order to succeed nowadays the need to create meaning for their customers, stakeholders and staff. It may be easy to brush this off as a millennial trend but research by Delloite has shown that 60% of employees choose where to work based on a sense of purpose, and workers were 54% more likely to remain long term at organizations that were perceived as purpose-driven. Additional benefits include greater employee trust, increased innovation, increased employee engagement and a broader selection of talent from which to hire.

Given the importance of building a purpose-driven organization, it’s worth asking why more companies do not succeed in infusing what they do with a clear sense of purpose. Although most organizations have worked out a mission, vision and core values they struggle to live these out. How then do you build a strong corporate culture? Jan Jacob Stam provides a solution with the concept of a “guiding principle”. Guiding principles are often used synonymously with core values. However, though the core values are important, Stam presents it as a single principle which describes and encompasses an organization’s sole purpose. Mission, vision and core values are certainly important, but defining a guiding principle allows you to clarify and communicate the core purpose of a business, a purpose with often already exists within the minds of employees and customers, which simply needs to be clarified.

The concept of the guiding principle is similar to a number of other popular theories, including Peter Koenig’s Source Principle, the concept of a “Massive Transformative Purpose” from the best seller Exponential Organizations (Ismail, Malone & van Geest), and is loosely related to Simon Sinek’s work in Start With Why. However, it’s different especially from the last two, because it is something you discover, rather than dictate. It is not created top-down but co-created by everyone involved with an organization. It exists in the minds of the people who work there, shops there, or invest there and in order to harness it, you have to first articulate it. In fact, when your guiding principle is expressed for the first time people often respond by saying “well of course” or “ we all knew that.” However,  if you take the time to discover your Guiding Principle it makes everything within your organization clearer and improves decision making at almost every level because you understand the purpose of the entire business. The mission describes what you do, the vision describes where you are going, but the Guiding Principle is the drive behind it all, the reason why everyone is contributing their time, money, emotions and energy.

At Team Academy, we defined our guiding principle by asking ourselves “what are we?”, “what do we stand for?”, “what do we believe?”, “What makes us different?”, and “why are we here?”.  We talked to different people in the organization, from students to staff to collaborators. We already knew that we provided a place for students who didn’t fit in the regular school system. One of the reasons we launched is because we thought that the way information is taught in school doesn’t suit all students, it doesn’t motivate or help them move towards their goals. Though it may work for some students there are always those on the edges of the bell curve who are struggling to realize their potential in a traditional university (and we think this group is growing). While defining our guiding principle we confirmed once again that we provide a place for students for whom purely theoretical knowledge shared in large halls by one person standing at the front is simply not effective or inspiring. We provide a place where they can learn in an active way which enables them to master both knowledge and the application of it more effectively. In short, we discovered that our guiding principle is “learning done differently”.

Defining our guiding principle has allowed us to create a stronger sense of direction within Team Academy: Whenever we have a meeting or discuss plans or ideas we’ll try to ask the questions “is his where we want to go?” “Is this who we are?”, “Does this match our guiding principle?”. We’ve discovered that the clearer it is, the more freedom you can give people. Having one goal which everyone knows and understands allows the team to all share their opinions and ideas without conflict because we are working with the same purpose. It not only creates alignment within the organization but also solves workplace politics to a degree because you are going somewhere together, rather than competing against one another. Though it may seem so, a guiding principle isn’t meant to be restrictive, in fact, it’s quite the opposite, there are many sub-ideas within Team Academy, and as long as they also lead towards the guiding principle, it is possible to give the team the freedom to pursue these sub-ideas without having to police whether or not they fit the current strategy. Everyone can be doing their own thing as long as it leads towards the main goal.

It’s also important to note that an organization is built around the guiding principle, not the owners or investors. They also serve the same goal, they are responsible for protecting it. This makes it possible for a business to continue even when the original founders no longer work there. Since the organization is based on a core idea, not a person, if you sell or pass on a company to someone who buys into it’s guiding principles it will continue to thrive. This is in part why companies often crash after a sale, or change of leadership. If the new leader(s) don’t uphold the original guiding principle, people reason for supporting, working for, or buying from that company is compromised.

Whether expressed or not, all organizations are built around a guiding principle, a single idea which lives in the minds of everyone connected to it. Describing it allows you to clarify and streamline everything you do from marketing to strategy to team development. The clearer your guiding principle is the easier it will be to decide who your customers are, who you want to hire, where you want to innovate and how you want to grow. It allows you to flourish and provide a sense of purpose to your staff. A sense of purpose which goes far beyond simply earning money more, or status. And, most importantly, that the more compelling the goal, the greater the purpose it provides.

Interested in discovering your guiding principles? Here are some questions you can ask yourself, your staff and your customers:

Who are we doing this for?
What is the impact we want to make in the world?
Why did people decide to work for/with us?

Why do my customers actually buy from me rather than my competitors? (is that really why? go deeper!)
Who am I most happy to have as customers?
Who am I most happy to work with and why?
Who is my team most happy to have as customers?
Who is my team most happy to work with and why?