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New research on institutional mission and purpose from Harvard Business School faculty on issues including the co-evolution of organizational design and identity, and 10 reasons to design a better corporate culture.
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How Much Does 'Deep Purpose' Matter to the Bottom Line?

by James Heskett

More leaders want their employees to aspire to loftier goals at work. But is deep purpose more about feel-good ideas or delivering business value? wonders James Heskett. Open for comment; 0 Comments.

How Etsy Found Its Purpose and Crafted a Turnaround

Re: Ranjay Gulati

Etsy, the online seller of handmade goods, was founded in 2005 as an alternative to companies that sold mass-manufactured products. The company grew substantially, but remained unprofitable under the leadership of two early CEOs. Ten years later, Etsy went public and was forced into a new arena, where it was beholden to stakeholders who demanded financial success and accountability. Unable to contain costs, the company was almost bought out by private equity firms in 2017—until CEO Josh Silverman arrived with a mission to save the company financially and, in the process, save its soul. Harvard Business School professor Ranjay Gulati discusses the purpose-driven turnaround Silverman and his team led at Etsy—to make the company profitable and improve its social and environmental impact—in the case, “Etsy: Crafting a Turnaround to Save the Business and Its Soul.” Open for comment; 0 Comments.

Navigating Tradeoffs: How Purpose Becomes a Company's ‘Lighthouse in the Storm’

by Ranjay Gulati

Leaders wrestle with tough decisions every day. Focusing on a company's higher purpose can help them make better choices, says Ranjay Gulati in this excerpt from his book Deep Purpose. Open for comment; 0 Comments.

When Employees Feel a Sense of Purpose, Companies Succeed

by Ranjay Gulati

Corporate cultures tend to encourage conformity. At a time when employees expect more from their jobs, companies should make space for individuality, Ranjay Gulati argues in this excerpt from his book, Deep Purpose. Open for comment; 0 Comments.

Recognition Incentives for Internal Crowdsourcing: A Field Experiment at NASA

by Jana Gallus, Olivia S. Jung, and Karim R. Lakhani

What to do if organizational hierarchy hinders a platform aimed at worker collaboration? A field experiment with NASA employees finds that they respond to managerial appreciation above other incentives.

The Effect of Systems of Management Controls on Misreporting

by Aishwarrya Deore, Susanna Gallani, and Ranjani Krishnan

This study provides insights for designing effective management control systems. Managers must select their individual management control practices with care, craft mission statements to convey clear messages that drive organizational alignment with the firm’s overall goals, and consider the effects of interaction between components of their system of controls.

Corporate Purpose and Firm Ownership

by Claudine Gartenberg and George Serafeim

This study shows that corporate purpose varies greatly according to the nature of firm ownership, and these differences can be least partly explained by the choices and compensation of the CEOs. The greater the pay gap between CEOs and employees, the lower the sense of corporate purpose within the organization.

Rehabilitating Corporate Purpose

by Malcolm S. Salter

Shareholder value maximization has become the de facto expression of the institutional purpose guiding many managers’ decision making. The author proposes an alternative, justice-based guideline for corporate purpose based on established moral and organizational principles.

These 4 CEOs Created a New Standard of Leadership

by Bill George

At the height of the 2008 financial crisis, these four corporate leaders stepped forward—and changed how we think of leadership forever, says Bill George. Open for comment; 0 Comments.

‘Does 'What We Do' Make Us 'Who We Are'? Organizational Design and Identity Change at the Federal Bureau of Investigation

by Ranjay Gulati, Ryan Raffaelli, and Jan Rivkin

Both the design and identity of the FBI changed greatly in the wake of the September 11, 2001 terrorist attacks. This study tracing the co-evolution of the Bureau’s organizational design and identity before the 9/11 attacks and through three subsequent phases finds that successful changes to organizational identity are likely to be delayed after a radical external shock: Management is likely to be constrained, appropriate design is probably unclear, or both.

Responsible Leadership in an Unforgiving World

by Michael Blanding

In a provocative new book, Joseph Badaracco argues that our world is increasingly characterized by struggle—for labor, technology, funds, and partners. Leaders who embrace that struggle can also reap its rewards. Closed for comment; 0 Comments.

How CEOs Sustain Higher-Ambition Goals

by Dina Gerdeman

At a recent conference, executives underscored the importance of employee engagement, contributing to the community, and creating sustainable environment strategies. Closed for comment; 0 Comments.

Book Excerpt: ‘The Strategist’

by Cynthia A. Montgomery

It's time for CEOs to start reclaiming strategy as a key executive responsibility, argues Cynthia A. Montgomery in her new book, The Strategist. Closed for comment; 0 Comments.

How ‘Hybrid’ Nonprofits Can Stay on Mission

by Carmen Nobel

As nonprofits add more for-profit elements to their business models, they can suffer mission drift. Associate Professor Julie Battilana says hybrid organizations can stay on target if they focus on two factors: the employees they hire and the way they socialize those employees. Key concepts include: In order to avoid mission drift, hybrid organizations need to focus on whom they hire and whether their employees are open to socialization. Because early socialization is so important, hybrid firms may be better off hiring new college graduates with no work background rather than a mix of seasoned bankers and social workers. The longer their tenure in a hybrid organization, the more likely top managers may be to hire junior people. Closed for comment; 0 Comments.

10 Reasons to Design a Better Corporate Culture

by James L. Heskett, W. Earl Sasser & Joe Wheeler

Organizations with strong, adaptive cultures enjoy labor cost advantages, great employee and customer loyalty, and a smoother on-ramp in leadership succession. A book excerpt from The Ownership Quotient: Putting the Service Profit Chain to Work for Unbeatable Competitive Advantage by HBS professors Jim Heskett and W. Earl Sasser and coauthor Joe Wheeler. Closed for comment; 0 Comments.