Start With Why (6 page)

What I found so attractive about the golden ratio, however, was that it had so many applications in so many fields. And even more significantly, it offered a formula that could produce repeatable and predictable results in places where such results might have been assumed to be a random occurrence or luck. Even Mother Nature—for most people a symbol of unpredictability—exhibited more order than we previously acknowledged. Like the golden ratio, which offers evidence of order in the seeming disorder of nature, The Golden Circle finds order and predictability in human behavior. Put simply, it helps us understand why we do what we do. The Golden Circle provides compelling evidence of how much more we can achieve if we remind ourselves to start everything we do by first asking why.

The Golden Circle is an alternative perspective to existing assumptions about why some leaders and organizations have achieved such a disproportionate degree of influence. It offers clear insight as to how Apple is able to innovate in so many diverse industries and never lose its ability to do so. It explains why people tattoo Harley-Davidson logos on their bodies. It provides a clearer understanding not just of how Southwest Airlines created the most profitable airline in history, but why the things it did worked. It even gives some clarity as to why people followed Dr. Martin Luther King Jr. in a movement that changed a nation and why we took up John F. Kennedy’s challenge to put a man on the moon even after he died. The Golden Circle shows how these leaders were able to inspire action instead of manipulating people to act.

This alternative perspective is not just useful for changing the world; there are practical applications for the ability to inspire, too. It can be used as a guide to vastly improving leadership, corporate culture, hiring, product development, sales, and marketing. It even explains loyalty and how to create enough momentum to turn an idea into a social movement.

And it all starts from the inside out. It all starts with Why.

Before we can explore its applications, let me first define the terms, starting from the outside of the circle and moving inward.

WHAT: Every single company and organization on the planet knows WHAT they do. This is true no matter how big or small, no matter what industry. Everyone is easily able to describe the products or services a company sells or the job function they have within that system. WHATs are easy to identify.

HOW: Some companies and people know HOW they do WHAT they do. Whether you call them a “differentiating value proposition,” “proprietary process” or “unique selling proposition,” HOWs are often given to explain how something is different or better. Not as obvious as WHATs, many think these are the differentiating or motivating factors in a decision. It would be false to assume that’s all that is required. There is one missing detail:

WHY: Very few people or companies can clearly articulate WHY they do WHAT they do. When I say WHY, I don’t mean to make money—that’s a result. By WHY I mean what is your purpose, cause or belief? WHY does your company exist? WHY do you get out of bed every morning? And WHY should anyone care?

When most organizations or people think, act or communicate they do so from the outside in, from WHAT to WHY. And for good reason—they go from clearest thing to the fuzziest thing. We say WHAT we do, we sometimes say HOW we do it, but we rarely say WHY we do WHAT we do.

But not the inspired companies. Not the inspired leaders. Every single one of them, regardless of their size or their industry, thinks, acts and communicates from the inside out.

I use Apple Inc. frequently as an example simply because they have broad recognition and their products are easy to grasp and compare to others. What’s more, Apple’s success over time is not typical. Their ability to remain one of the most innovative companies year after year, combined with their uncanny ability to attract a cultlike following, makes them a great example to demonstrate many of the principles of The Golden Circle.

I’ll start with a simple marketing example.

If Apple were like most other companies, a marketing message from them would move from the outside in of The Golden Circle. It would start with some statement of WHAT the company does or makes, followed by HOW they think they are different or better than the competition, followed by some call to action. With that, the company would expect some behavior in return, in this case a purchase. A marketing message from Apple, if they were like everyone else, might sound like this:

It’s not a very compelling sales pitch, but that’s how most companies sell to us. This is the norm. First they start with WHAT they do—“Here’s our new car.” Then they tell us how they do it or how they are better—“It’s got leather seats, great gas mileage, and great financing.” And then they make a call to action and expect a behavior.

You see this pattern in business-to-consumer markets as well as business-to-business environments: “Here’s our law firm. Our lawyers went to the best schools and we represent the biggest clients. Hire us.” This pattern is also alive and well in politics—“Here’s the candidate, here are her views on taxes and immigration. See how’s she’s different? Vote for her.” In every case, the communication is organized in an attempt to convince someone of a difference or superior value.

But that is not what the inspiring leaders and organizations do. Every one of them, regardless of size or industry, thinks, acts and communicates from the inside out.

Let’s look at that Apple example again and rewrite the example in the order Apple
actually
communicates. This time, the example starts with WHY.

It’s a completely different message. It actually
feels
different from the first one. We’re much more eager to buy a computer from Apple after reading the second version—and all I did was reverse the order of the information. There’s no trickery, no manipulation, no free stuff, no aspirational messages, no celebrities.

Apple doesn’t simply reverse the order of information, their message starts with WHY, a purpose, cause or belief that has nothing to do with WHAT they do. WHAT they do—the products they make, from computers to small electronics—no longer serves as the reason to buy, they serve as the tangible proof of their cause. The design and user interface of Apple products, though important, are not enough in themselves to generate such astounding loyalty among their customers. Those important elements help make the cause tangible and rational. Others can hire top designers and brilliant engineers and make beautiful, easy-to-use products and copy the things Apple does, and they could even steal away Apple employees to do it, but the results would not be the same. Simply copying WHAT Apple does or HOW it does it won’t work. There is something more, something hard to describe and near impossible to copy that gives Apple such a disproportionate level of influence in the market. The example starts to prove that people don’t buy WHAT you do, they buy WHY you do it.

It’s worth repeating: people don’t buy WHAT you do, they buy WHY you do it.

Apple’s ability to design such innovative products so consistently and their ability to command such astounding loyalty for their products comes from more than simply WHAT they do. The problem is, organizations use the tangible features and benefits to build a rational argument for why their company, product or idea is better than another. Sometimes those comparisons are made outright and sometimes analogies or metaphors are drawn, but the effect is the same. Companies try to sell us WHAT they do, but we buy WHY they do it. This is what I mean when I say they communicate from the outside in; they lead with WHAT and HOW.

When communicating from the inside out, however, the WHY is offered as the reason to buy and the WHATs serve as the tangible proof of that belief. The things we can point to rationalize or explain the reasons we’re drawn to one product, company or idea over another.

WHAT companies do are external factors, but WHY they do it is something deeper. In practical terms, there is nothing special about Apple. It is just a company like any other. There is no real difference between Apple and any of its competitors—Dell, HP, Gateway, Toshiba. Pick one, it doesn’t matter. They are all corporate structures. That’s all a company is. It’s a structure. They all make computers. They all have some systems that work and some that don’t. They all have equal access to the same talent, the same resources, the same agencies, the same consultants and the same media. They all have some good managers, some good designers and smart engineers. They all make some products that work well and some that don’t . . . even Apple. Why, then, does Apple have such a disproportionate level of success? Why are they more innovative? Why are they consistently more profitable? And how did they manage to build such a cultish loyal following—something very few companies are ever able to achieve?

People don’t buy WHAT you do, they buy WHY you do it. This is the reason Apple has earned a remarkable level of flexibility. People are obviously comfortable buying a computer from Apple. But people are also perfectly comfortable buying an mp3 player from them, or a cell phone or a DVR. Consumers and investors are completely at ease with Apple offering so many different products in so many different categories. It’s not WHAT Apple does that distinguishes them. It is WHY they do it. Their products give life to their cause.

I’m not so foolhardy as to propose that their products don’t matter; of course they do. But it’s the reason they matter that is contrary to the conventional wisdom. Their products, unto themselves, are not the reason Apple is perceived as superior; their products, WHAT Apple makes, serve as the tangible proof of what they believe. It is that clear correlation between WHAT they do and WHY they do it that makes Apple stand out. This is the reason we perceive Apple as being authentic. Everything they do works to demonstrate their WHY, to challenge the status quo. Regardless of the products they make or industry in which they operate, it is always clear that Apple “thinks different.”

When Apple first came out with the Macintosh, having an operating system based on a graphical user interface and not a complicated computer language challenged how computers worked at the time. What’s more, where most technology companies saw their biggest marketing opportunity among businesses, Apple wanted to give an individual sitting at home the same power as any company. Apple’s WHY, to challenge the status quo and to empower the individual, is a pattern in that it repeats in all they say and do. It comes to life in their iPod and even more so in iTunes, a service that challenged the status quo of the music industry’s distribution model and was better suited to how individuals consumed music.

The music industry was organized to sell albums, a model that evolved during a time when listening to music was largely an activity we did at home. Sony changed that in 1979 with the introduction of the Walkman. But even the Walkman, and later the Discman, was limited to the number of cassette tapes or CDs you could carry in addition to the device. The development of the mp3 music format changed all that. Digital compression allowed for a very high quantity of songs to be stored on relatively inexpensive and highly portable digital music devices. Our ability to walk out of the house with only one easy-to-carry device transformed music into something we largely listened to away from home. And the mp3 not only changed where we listened to music, it also transformed us from an album-collecting culture to a song-collecting culture. While the music industry was still busy trying to sell us albums, a model that no longer suited consumer behavior, Apple introduced their iPod by offering us “1,000 songs in your pocket.” With the iPod and iTunes, Apple did a much better job of communicating the value of both the mp3 and the mp3 player relative to how we lived our lives. Their advertising didn’t offer exhaustive descriptions of product details; it wasn’t about them, it was about us. And we understood WHY we wanted it.

Apple did not invent the mp3, nor did they invent the technology that became the iPod, yet they are credited with transforming the music industry with it. The multigigabyte portable hard drive music player was actually invented by Creative Technology Ltd., a Singapore-based technology company that rose to prominence by making the Sound Blaster audio technology that enables home PCs to have sound. In fact, Apple didn’t introduce the iPod until twenty-two months after Creative’s entry into the market. This detail alone calls into question the assumption of a first mover’s advantage. Given their history in digital sound, Creative was more qualified than Apple to introduce a digital music product. The problem was, they advertised their product as a “5GB mp3 player.” It is exactly the same message as Apple’s “1,000 songs in your pocket.” The difference is Creative told us WHAT their product was and Apple told us WHY we needed it.

Only later, once we decided we had to have an iPod, did the WHAT matter—and we chose the 5GB version, 10GB version, and so on, the tangible details that proved we could get the 1,000 songs in our pocket. Our decision started with WHY, and so did Apple’s offering.

How many of us can say with certainty that, indeed, an iPod is actually better than Creative’s Zen? iPods, for example, are still plagued with battery life and battery replacement issues. They tend to just die. Maybe a Zen is better. The reality is, we don’t even care if it is. People don’t buy WHAT you do, they buy WHY you do it. And it is Apple’s clarity of WHY that gives them such a remarkable ability to innovate, often competing against companies seemingly more qualified than they, and succeed in industries outside their core business.