Former Best Buy CEO Hubert Joly feels that much of what he learned about motivating performance at business school, McKinsey, or during his early days as an executive is either wrong, dated, or incomplete.
“The old approach to strategy formulation and implementation was quite top-down,” he says. “It tended to look like this: take a group of smart people, have them create a smart strategy and implementation plan, communicate the whole thing, and put incentives in place to create alignment. This approach does not work, because it fails to excite people.”
I interviewed him on this topic recently in conjunction with the release of his new bestselling book THE HEART OF BUSINESS: Leadership Principles for the Next Era of Capitalism.
“I believe the recipe for creating an environment that allows everyone to blossom and produce irrationally good outcomes has five key ingredients,” he says.
1. Connecting dreams.
“Getting invested in what the company stands for because it resonates with what makes you get out of bed in the morning is one of the essential ingredients of engagement,” Joly says. Clearly articulating and feeding that connection between personal and company purpose for every team member is, therefore, one of the most crucial roles of any leader, from top executives to middle managers.
For example, one of his Best Buy store managers asked every single employee this question: “What is your dream?” Every associate’s answer was written on a whiteboard in the break room, next to their name. The store manager, after he wrote it down, would always tell them, “Let’s work together to help you achieve it.”
At Best Buy, Joly implemented an iterative process that continues today and entails these directives:
- Explicitly articulating a people-first philosophy
- Exploring what drives people around you
- Capturing moments that matter
- Sharing stories and encouraging role modeling
- Framing the company’s purpose in a meaningful, human, and authentic fashion
- Spreading meaning
2. Developing human connections.
“My former colleague Shari Ballard often said that companies are not soulless entities; they are human organizations made of individuals working together toward a common purpose,” Joly says. To unleash human magic, everyone must feel at home, fully valued for who they are, with the space and freedom to be themselves. Only then can people bring their best selves to work.
Such environments get created by treating everyone as an individual. It means encouraging vulnerability and creating a safe and transparent environment to build trust. And with that comes developing effective team dynamics and ensuring diversity and inclusion.
“This has become a pillar of Best Buy’s strategic transformation and its soul as a company,” Joly says.
3. Fostering autonomy.
“A command-and-control approach is no longer in sync with today’s environment,” Joly says. “In our new reality, being nimble and innovative is crucial. The need for emotional intelligence, speed, and flexibility means that employee autonomy has become essential to success. In most cases, decisions cannot–and should not–trickle down from the top.”
Autonomy, or the ability to control what you do, when you do it, and with whom, is one of the fundamental elements of what intrinsically motivates us, which leads to better performance.
“Autonomy leads us to think creatively, which breeds innovation,” Joly says. He’s dead on because innovation does not happen without the freedom to try out new ideas.
Autonomy is also motivating because it is more satisfying. “Few people enjoy being told what to do,” Joly says, “I know I do not. And research has shown that stress levels at work are directly related not only to how demanding a job is but also to the latitude one has to control and organize one’s own work. The less freedom, the more draining work gets.”
With more autonomy and less stress on the job, the power of human magic is unleashed. But you need to set the right environment where autonomy helps generate human magic (and not the chaos of everyone doing whatever they want). Joly suggests:
- Pushing decision-making as far down as possible
- Preferring a participative process
- Adopting agile ways of working
- Adjusting to skill and will.
4. Growing mastery.
“The ultimate goal of a company just may be the growth and fulfillment of everyone working there,” Joly says. At a minimum, employees’ growth and fulfillment are essential to performance, and the role of leaders is to create the environment that allows for mastery. “Ironically,” he says, “a sustained focus on mastery and process, rather than on outcomes themselves, is what consistently delivers the best possible results.” Mastery is essential to performance because becoming great at what one does best is fundamentally satisfying and motivates us as human beings.
Joly recalled that one of his bosses at a previous employer told him, “I appreciate efforts. But I really care about performance.” That’s a tempting way to lead, Joly says. “It’s easy to focus on performance gaps and just say ‘do better,’ but it probably won’t work.”
Creating an environment where mastery develops requires:
- Focusing on effort over results
- Developing individuals rather than the masses
- Coaching rather than training
- Reassessing performance assessment and development
- Treating learning as a lifelong journey
- Making space for failure
5. Nurturing a growth environment.
Growth is an imperative and something you should always strive for as a leader. “It creates space for promotion opportunities, productivity improvement without job loss, taking risks, and investing. Business growth fosters individual growth and drive, which in turn feeds back into innovation and further business expansion,” says Joly.
As such, growth is the fifth and final essential ingredient of unleashing human magic. “It is hard to feel energized, creative, and ready to take risks in a context of stagnation, contraction, fear, uncertainty, or doubt,” he says. “A sense of endless possibilities–both for oneself and for the business in pursuit of a noble purpose–fuels inner drive, positive energy, and the desire to bring one’s best self to the table.”
If you are supposedly facing “headwinds” and oppression in your current market, as Best Buy was when Joly stepped into the CEO role, you tack to put the wind at your back by thinking in terms of possibilities; turning challenges to your advantage; and keeping purpose front and center.
In summary, “when a company’s noble purpose aligns with the employees’ own individual search for meaning and benefits all the stakeholders involved with the organization,” Joly says, “it can unleash the kind of human magic that results in irrational performance.” Joly shares these insights not only in his book, but also as a senior lecturer at Harvard Business School, and as a coach and mentor of CEOs and senior executives.