Great leaders are driven by a purpose that goes beyond the profit motive; shareholders are primarily interested in profit. It's up to the board of directors to bring them together.
Profit maximization may be the official rhetoric of most large companies, but many businesspeople know that what really drives some of our most successful corporations is capable, dedicated people at the top, middle, and bottom of the hierarchy who are inspired to give their best. They want to be -- and often are -- driven by their sense of what is right and worthwhile. In other words: a sense of purpose. The paradox is that those companies whose employees are driven in this way are also some of the most profitable and successful over the long term. Strangely, shareholder value is maximized by those who don't care too much about it. And it is no good pretending you don't care about it: When a sense of purpose becomes a tool to generate profits, a kind of glorified mission statement, it is always seen for what it is -- a cynical ploy -- and it is worse than useless.
Throughout history, many of our best business leaders have been driven by such a purpose: Henry Ford, Tom Watson, Sam Walton, Siegmund Warburg, and Bill Gates, among others. Some have wanted to innovate and create new things, some to achieve excellence, some to change the world, and some simply to help their fellow human beings. In Built to Last, Jim Collins and Jerry Porras have also demonstrated with great thoroughness how the most successful companies are not driven primarily by the profit motive. One reason that purpose generates profit is because it drives leaders to see possibilities in their business environment that their competitors fail to see. Ford, Watson, Walton, Warburg, and Gates all saw their industries in a different light than their competitors, in all cases because each saw his company as a vehicle for his distinctive purpose, his sense of what was right and worthwhile. Most of their less successful competitors took a more conventional view and so were forced to imitate rather than create best practice.
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