The Power of Why in Business: Guest Blog by Jocelyn Jaixin Cao
Introduction by Helio Fred Garcia:
This is my fourth in a series of guest blogs featuring my recently-graduated capstone (thesis) advisees in New York University’s Master’s in Public Relations and Corporate Communication.
(See my earlier posts, On Wall Street, Reputation, and Recovery: Guest Blog by Julia Sahin here; On Changing Narratives in Oil Conflict Regions: Guest Blog by Claudia Espinel here; and A 10-C Model for Apologies: Guest Blog by Iris Wenting Xue here.)
In this blog, Jocelyn Jaixin Cao applies a foundational principle of effective persuasion – start with Why – to the core identity of companies. She notes that the most successful companies are those which make the Why a central part of their work, both in their statement of values, vision, and mission, and in the day-to-day decision criteria they use.
Quite presciently, among the many companies she studied, she contrasts Google, which has a very strong Why identity, and which just overtook Apple as the largest company in the world, with Yahoo, which has always been a What company focused on features and benefits but without clear purpose, and which is now struggling to survive, never mind remain relevant.
You can see the complete capstone here.
DEVELOPING THE “WHY” FRAME IN BUSINESS DECISION-MAKING AND COMMUNICATION:
GUEST BLOG BY JOCELYN JIAXIN CAO
To stand out from competitors and to survive in a rapidly changing business environment, most companies spend the majority of their time in differentiating their products or services. However, studies show that differentiation is not enough to establish trust and loyalty. Companies need to earn trust by communicating and demonstrating their core values and beliefs clearly and consistently to their audience. Creating a “why” frame that includes these values and beliefs within the corporation becomes vital.
Companies influential on a global scale, such as Google, Facebook, and Uber, follow a similar communication strategy. They tell us first why they exist before talking about what they are selling. They know that to successfully connect with their audience, they need to first address what the audience cares about, not what is important only tothemselves. The origin of the “why” comes from the genesis story and the core values embraced by the company. It is not simply a slogan for the purpose of grabbing attention, but something the corporation truly believes in and is willing to fight for: it is the foundation of a corporation’s mission and vision.
- The Importance of “Why” in Business Decision-making and Communication
Google, Facebook, and Uber all have a clear “why” of their existence in the first place. The origin of their “why” is not for themselves, but for better serving the society. Google was created because Larry Page and Sergei Brin wanted to improve people’s search experience at that time; Facebook was brought into being because of the desperate need by Harvard students for a comprehensive online social network based on real identity; Uber was built to tackle the common issue of frustrating taxi services in major cities around the world. They are all originated from finding solutions for problems experienced by people at that time, and this is valued more than making money.
In addition, they all place their “why” at the center of decision-making, whether for big business decisions or day-to-day management. When Google’s engineers were developing a new project, they were encouraged to ask the question “Is it best for our users? Is it evil?” When hiring new employees, Google ensured that the person not only had the skills needed, but also fit into its “smart creative” culture – a culture that is “willing to question the status quo and attack things differently.”
Facebook rejected advertisers whose businesses were not relevant to a college social culture even though they were companies like Goldman Sachs that could bring large amounts of money to them at their early stage. Later, it also turned down several deals with big investors such as Viacom and Yahoo because Mark Zuckerberg did not think those companies understood Facebook’s vision. When Uber was facing the huge backlash from the taxi industry and government officials, they did not fight back immediately, but focused on presenting their “why” to their customers and local governments through face-to-face conversations. It did not work out in every city, but it provoked a worldwide discussion on this issue, which to some extent increased Uber’s brand awareness.
Moreover, they all never stop enlarging and enriching their original “why” frames, which shows their constant thinking about the “why.” Google interpreted its “why” clearly to the public through the “Ten Things We Know To Be True”. Facebook revised its mission statement several times since its first establishment in 2004. Uber positioned itself as a lifestyle and logistics company, rather than a car service company, with its new trials such as Uber Ice Cream and UberCARGO.
In contrast, many of the competitors in the history of Google, Facebook and Uber failed to create their “why” or prioritize their “why” in communications. Therefore, they either lost the competitive advantage quickly or simply could not compete at all.
(1) Facebook vs. MySpace: MySpace existed and was widely welcomed before the inauguration of Facebook. It targeted the same audience – college students, received a lot of early press, and generated huge valuation among its investors. However, Facebook quickly overtook its market share. One crucial reason is that after being purchased by the News Corporation, MySpace’s original “why” no longer fit into its new reality. News Corp tried to guide MySpace by using the “professional management” approach. Leaders from News Corp sat down describing where the business would head, where they would invest and how they would earn a positive ROI by carefully calculating what would work. Those professional leaders at News Corp had no idea about the nature of social network among college students and they ran MySpace like a professional business. Contrarily, Zuckerberg allowed Facebook to go wherever the market wanted it. His team looked into the comments of their users and understood their audience well.
(2) Google vs. Bing: On May 28, 2009, Microsoft CEO, Steve Ballmer, publically demonstrated Bing for the first time at the All Things Digital Tech Conference in San Diego, California. In the live interview at the conference, when asked the reason Microsoft decided to rebrand the name of Live Search as Bing, Ballmer said the search engine industry was a large growing market and Microsoft should be in that market. To make their presence more obvious, they needed a short and crispy name that could “verb it up.” Reports also showed that Microsoft was planning to spend $100 million for the marketing campaign of Bing. Compared to Google, Bing indeed differentiated itself in many aspects to demonstrate its specialty. However, after six years, statistics shows that Google is still the dominant search engine with 66% market share around the world while Bing only accounts for 12% even after its partnership with Yahoo. When companies lose their “why” at the beginning, it is usually hard to catch up later. Microsoft did not know clearly why they rebranded their search engine. Therefore, even though they successfully differentiated the product from competitors’ via marketing campaigns, loyalty did not follow.
(3) Uber vs. Lyft: On May 22, 2012, John Zimmer and Logan Green launched Lyft to “give Uber some low-priced private driver/taxi competition.” Lyft differentiated itself from Uber by adding two more pillars to its business: ride sharing for long-distance car rides, and a University program where Lyft charges colleges for specific campus car-sharing programs. Now three years after its launch, Lyft has indeed received positive reviews from its community and is growing steadily in the U.S. However, compared to the sensation Uber has created around the world, Lyft looks more like a different version of Uber, rather than having its unique corporate identity. When a company’s “why” is mainly based on business competition, rather than the solution to the problems cared by its users, it may see a sound short-term gain by differentiating the services, but will soon be replaced by new companies with better products. Zimride, Lyft’s predecessor, is a failed example.
- Developing the “Why” frame
The process of creating the “why” frame can be divided into two parts:
The first part is the formation of the original “why.” Usually, a company’s genesis story is at the core of its original “why.” Page and Brin created Google in Stanford dorm as part of their PhD research, and their academic backgrounds and personal beliefs later influenced many aspects of Google’s growth. Zuckerberg’s dramatic founding story distinguished Facebook from other startups at that time, and was later brought live on the big screen by Hollywood in 2010. Uber’s original “why” emerged in a raining night in Paris when Garrett Camp and Travis Kalanick were annoyed by the taxi services there. At that moment, they decided to crack the problem. These stories were not just stories, but later became core elements of their corporate cultures.
The second part is the enlargement of the “why.” To successfully fulfill the mission of the original “why,” leaders need people who share their vision to make it real together. At this time, corporate culture becomes significant for a company to convey and to represent its “why” to the outside world. Both Google and Facebook establish their unique cultures at very early stage. Both of them adopt the bottom-up management style and the flat corporate structure as they believe in openness and transparency, but despise bureaucracy. Both of them use the working environment to demonstrate and communicate the values to their employees. They build up their offices based on those values so that employees can be constantly reminded and inspired.
- Implementing the “Why” Frame in Daily Communications
The implementation of the “why” begins first internally among employees. Google and Facebook start very early on establishing an effective communication mechanism within the corporation. Whether it is Google’s weekly all-hands (TGIF) meetings, the quarterly OKR (Objective and Key Results) reports, or Facebook’s Q&A session every Friday with Zuckerberg, the regular Hackerathon competition, leaders at Google and Facebook know clearly the importance of internal communication to a corporation’s long-term success. Employees are, after all, a company’s best and most valuable brand ambassadors. An inside-out approach to engagement empowers employees in this process by allowing them to personify the company’s values externally. Therefore, companies should first think to develop an efficient and sustainable system for internal communication – to create a culture of “why” within the company.
After having a solid “why” internally, companies will have more confidence in external
communication. One key principle in external communication is to meet audience where they are. This requires companies to shift their focus of communication from brand itself to its audience because the audience, or the market, is always the “why” brands exist in the first place. By first addressing what the audience are concerning about, companies create a frame of communication that provides meaningful context for introducing the facts and features of their brands. It is also a process to activate and connect with the frames already existed in the audience’s minds. Companies should always ask themselves why the audience should care about what they are saying.
Start with Why
“People don’t buy what you do, they buy why you do it.” This is the core argument Simon Sinek articulated in his TED Talk “How Great Leaders Inspire Action” and his book Start With Why. Sinek says there are only two ways to influence human behavior – manipulation or inspiration. Business decision-makers can easily grasp and reproduce manipulative strategies such as reducing prices or increasing marketing campaigns to grab attention, while generating inspiration usually requires richer thoughts and deeper motivation. Developing the “why” frame starts the company on a journey of self-exploration and lays the foundation for a steady flow of inspiration.
Jocelyn Jaixin Cao received her BA in English Language and Literature from Southern Yangtze University School of Foreign Studies and Honors School in Wuxi, China. She studied linguistics in the Global Studies program at University of California, Davis. She received her MS in Public Relations and Corporate Communication from New York University in December, 2015. She is a certified interpreter in the New York City mayor’s office.