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It’s time to upgrade to a purpose-based operating system

Jim Whitt Published on 28 June 2013

Kim Koehn grew up on a dairy near Copeland, Kansas. Today, he manages High Plains Dairy near Plains, Kansas. The two dairies are about an hour and 4,000 cows apart.

So what do you have to do to make the transition from milking 65 cows to milking 4,000 cows? Kim will tell you it requires a change in attitude about cows and people: “I used to like working with cows and hated working with people. Now, I like working with people a lot more than cows.”

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One of the first things I learned when I went to work for Ralston Purina in the 1970s was this, “We’re not in the feed business. We’re in the people business.”

I don’t care what you produce or what kind of service you provide, every business is a people business. And that’s the conclusion Kim Koehn reached – the dairy business is a people business.

The only way any business can reach its full potential is by helping its people reach their full potential.

And that’s what I’ve been doing for the last 25 years. I’ve developed a business operating model that focuses on four principles – purpose, partnering, pioneering and profit.

• I don’t do mission statements. I help businesses identify their purpose, and that purpose has to meet four requirements. It has to be positive, powerful, simple and serving.

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• I help businesses attract employees who want to be partners in the fulfillment of that purpose instead of just working for a paycheck.

• I don’t do traditional strategic planning; I help businesses pioneer. That means looking a generation (30 years) into the future and working their way back to the present.

• I help businesses get bottom-line results. Profit is the natural byproduct of purpose, partnering and pioneering.

This is not the traditional approach to business development. But I’m not a traditional business consultant. I have a degree in animal science, a lifetime of working in the livestock business and a dozen years in sales and marketing. That background has provided me with a unique perspective of human behavior.

My approach can be summarized in one sentence: “Without a purpose, our only motivation is reward and punishment.” You can train any animal using reward and punishment. People are animals, and we have been trained like animals.

If you think using reward and punishment is the most effective way to motivate people, you probably like cows more than people. But your operation will never reach its full potential. Here’s why.

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Reward and punishment are extrinsic stimuli. If you rely on the carrot and the stick, you have to continually increase the degree of reward and punishment to elicit higher levels of response. The problem is: You’ll eventually run out of carrots and sticks.

Reward and punishment are manipulation. They require you to do something to someone to get them to respond. And human beings naturally resist manipulation.

The thing that separates us from other animals is that our animal bodies house the human spirit. The human spirit responds only to the one stimulus that is unique to our species – purpose. All other animals are just trying to eat and keep from being eaten.

We are the only animals that seek meaning for our existence. When we find meaning in our work, we rise above our animal natures and become intrinsically motivated. That’s the path to maximizing our potential.

I have to admit that my purpose-based approach to business used to be a tough sell. But the last several years, my business has been booming.

There are probably several reasons. One is I think the economic meltdown of 2008 forced businesses to come to the realization they have to change the way they do business or go out of business. So they are searching for a new model.

The purpose-based approach is a new model that’s been validated by research. In the January 1st 2013 issue of Progressive Dairyman , Walt Cooley shared some insights from Daniel Pink’s book, “Drive: The Surprising Truth About What Motivates Us.”

Here’s how Pink summarizes his book on his website: “When it comes to motivation, there’s a gap between what science knows and what business does. Our current business operating system – which is built around external, carrot-and-stick motivators – doesn’t work and often does harm.

We need an upgrade. And the science shows the way. This new approach has three essential elements: autonomy – the desire to direct our own lives; mastery – the urge to get better and better at something that matters; and purpose – the yearning to do what we do in the service of something larger than ourselves.”

Nowhere has the carrot-and-stick operating system needed an upgrade more than agribusiness. I’ve worked with businesses in several different industries but have been encouraged by the increase in my business with agricultural clients over the last few years.

I think the rapid pace of consolidation is facilitating a shift in attitude about managing people. The larger your operation becomes, the more you have to focus on developing people.

That brings me back to Kim Koehn. I met Kim through my work with Clawson Ranch, one of my clients and a High Plains Dairy shareholder. Clawson Ranch is a diversified agribusiness that decided the path to reaching their full potential was to help their people reach their full potential.

I asked Kim when he made the transition from being a cow person to a people person. He said it’s a process that has paralleled his career path going from running a small dairy to becoming a herdsman for a 2,500-cow dairy to managing a 4,000-cow dairy.

He also said it’s a never-ending process. And he’s right. The growth and profitability of his dairy is directly correlated to his ability to develop people.

Consolidation is not going to go away; it’s going to accelerate. You’ll either grow or go. If you choose to stick with the carrot-and-stick operating system, you’re going to go.

If you want to grow, it’s time to upgrade to a purpose-based operating system. Because without a purpose, our only motivation is reward and punishment. PD

Whitt has written a book about purpose-driven businesses entitled, “Riding for the Brand: The Power of Purposeful Leadership.”

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Jim Whitt
Founder
Purpose Unlimited

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