Generative enterprise

Purpose and value




Collaborative project work (a.k.a. co‑creation)

More quotes

Further reading

Generative enterprise

Generativity is a term coined by Erik Erikson, a psychologist and psychoanalyst known for his theory on the psychological development of human beings. In this theory, he contrasts generativity with stagnation, which is about failing to find a way of contributing to one’s community, and to society as a whole.

Generative individuals, workgroups and organizations shun the status quo and show disdain for mediocrity, seeking instead to create that which improves people’s lives and makes the world a better place.

+ Another definition of generativity
The capacity of an idea, model or theory to challenge the guiding assumptions of the culture, to raise fundamental questions regarding contemporary social life, to foster reconsideration of that which is taken for granted. Source: Kenneth J. Gergen, cited in Generative Image: Sourcing Novelty (pdf) by Gervase Bushe and Jacob Storch.
You are not here merely to make a living. You are here in order to enable the world to live more amply, with greater vision, with a finer spirit of hope and achievement. You are here to enrich the world, and you impoverish yourself if you forget the errand.
Woodrow Wilson
Woodrow Wilson, 28th President of the United States
View the full transcript of an address given by Woodrow Wilson containing this excerpt
You are here to enrich the world. Your enterprise (a better word than organization, in my view) is here to enrich the world. Your employees are here to enrich the world. That is my working hypothesis. It forms the basis of my personal philosophy and informs all of my work.

Generative enterprise is therefore the term I use when referring to a business or non-profit organization that focuses on generating maximum value for customers or users, other stakeholders, and wider society.

It is my unshakeable conviction that an enterprise seeking to enrich the world will enrich itself, its employees and its shareholders as a natural consequence.

There seems to be an endless stream of thought leaders and consultants who claim to have engineered a more “scientific” approach to business. Yet they, just like the positivists, always seem to fall short. Unfortunately, the real world defies logic.
Greg Satell
– Greg Satell, Why Business Defies Logic

Purpose and value

What is an enterprise for?

First, we’ll let David Packard, co-founder of Hewlett-Packard, answer that question:

“I want to discuss why a company exists in the first place. In other words, why are we here?

I think many people assume, wrongly, that a company exists simply to make money. While this is an important result of a company’s existence, we have to go deeper and find the real reasons for our being.

As we investigate this, we inevitably come to the conclusion that a group of people get together and exist as an institution that we call a company so they are able to accomplish something collectively that they could not accomplish separately—they make a contribution to society, a phrase which sounds trite but is fundamental.

You can look around and see people who are interested in money and nothing else, but the underlying drives come largely from a desire to do something else: to make a product, to give a service—generally to do something which is of value.”

He said those words in a speech he gave to employees in 1960. Now let’s hear from Lou Gerstner, the former chairman and CEO of IBM, putting it much more succinctly in his book Who Says Elephants Can’t Dance?:

“In the end, an organization is nothing more than the collective capacity of its people to create value.”

If we choose to embrace the idea that the purpose of an enterprise is creating value (read about the three types of value: economic, conceptual, and experienced), we need to consider who the beneficiaries of this value should be.

Generating maximum ecosystem value

Ecosystem Value Specification, by Jack Martin Leith
View the article Who are your anti-clients? by Tom Graves, Tetradian Consulting

The Ecosystem Value Specification process enables those embarking on an innovation project to examine each constituent of the enterprise ecosystem and determine:

  • What existing value must be preserved.
  • What new value might be created.
  • What anti-value generation should be eliminated.
  • What value must be sacrificed for the good of the whole. When value is sacrificed in this way, the consequent generation of anti-value must be foreseen and mitigated, and those experiencing the anti-value may need some form of compensation.

Read about value and anti-value

The principle behind this work is that if the proposed project meets the value requirements of all constituents of the enterprise ecosystem, then the relevant people within these constituent organizations will support the project, or—at the very least—will not hinder its progress.

Note that creating the Ecosystem Value Specification is a painstaking process. It is not simply a form-filling exercise.

Why does purpose matter?

Mihaly Csikszentmihalyi, Distinguished Professor of Psychology and Management, Claremont Graduate University, explains it like this:

“If a leader demonstrates that his purpose is noble, that the work will enable people to connect with something large—more permanent than their material existence—people will give the best of themselves to the enterprise.”

Here’s a longer rationale, backed up by research:

“The age of the purpose-driven company has taken root in the U.S. today and will continue to grow in the coming decade. That’s because stakeholders—led by employees, both new and seasoned—are increasingly demanding that companies have a purpose beyond making a profit.

In fact, going forward, for a company to grow and be successful, it will need to articulate a values-driven mission that balances purpose and profit. Those companies that do will have a competitive advantage over those that do not.

What makes me say all this? Well, it’s not me. These statements come straight from the mouths of CEOs and other c-suite executives leading the country’s Fortune 1000 companies. They recently participated in a national survey about corporate America and social purpose that Covestro commissioned earlier this year.

It was striking to see how strongly the c-suite spoke on this issue with one unified voice.”

Source: Employee Purpose is Driving Company Purpose—What Human Resources Executives Need to Know, by Lanier Robertson, Vice President, Human Resources, Covestro LLC, on HR Technologist.

How to determine purpose

Tom Nixon
Tom Nixon
In his Medium article Where does the purpose of a company come from?, Tom Nixon, the founder of Maptio and a specialist in developing purposeful organizations, describes three approaches for identifying purpose: Designing, Sensing, and Discovering.

1. Designing

This is the most common approach. Members of the senior leadership team determine the purpose, often with the assistance of a facilitator and some representatives from the workforce. The result is usually an uninspiring statement that could apply to any business operating in the same sector. It is then transmitted to employees, who can smell bullshit at a thousand paces and treat it with the contempt it deserves.

2. Sensing

Frederic Laloux is the author of Reinventing Organizations, a groundbreaking book in which he introduces a new organizational paradigm he calls Teal. The label is borrowed from Spiral Dynamics Integral, conceived primarily by Ken Wilber as an evolved form of Don Beck and Christopher Cowan’s Spiral Dynamics concept, itself a build on the work of Clare Graves.

Red, Amber, Orange, Green and Teal organizations
Technical note: In the Beck and Cowan version, Teal is labelled Yellow and represents a systemic worldview.
Evolution of worldviews, by Jack Martin Leith
A Teal organization resonates with “the next stage in the evolution of human consciousness” and embodies three principles: self-management, wholeness — and evolutionary purpose, meaning the organization evolves in unison with an unseen but ever-present evolutionary impulse.
… organizations are viewed as an independent energy field with a purpose that transcends [their] stakeholders. In this paradigm we don’t own or run the organization; instead we are stewards, listening to where it needs to go and helping it to do its work in the world.

Reinventing Organizations wiki
Read more about Teal Organizations on the Reinventing Organizations website

And, in contrast: Is Teal the New Black? Probably Not

Tom Nixon, who has interviewed Frederic Laloux and knows his work well, says this view of purpose denies the incredibly powerful influence of the leaders who created the purposeful pioneer organizations in the first place. (Source: Where does the purpose of a company come from?)

He writes: “There’s an awkward paradox which Laloux highlights in the book: on the one hand there’s a belief that Teal organisations are truly decentralised, like a rainforest where ‘no single tree is in charge’, yet there’s a key role necessary for a founder or CEO to play in ‘holding the space’. Which means it’s not actually decentralised or detached from humans as the dogma/ideology of evolutionary purpose suggests.”

In a subsequent article, Resolving the awkward paradox in Frederic Laloux’s Reinventing Organisations, he includes some comments Frederic Laloux made to a draft version:

I think I’m in full agreement with everything you write. It’s funny because I’ve had quite a few readers tell me that they find I overemphasize the importance of the founders and CEOs. You are the first one so far who tells me that I have underemphasized their role!
[…] Now that I’ve encountered Peter Koenig’s thinking, I have better words for what I called “holding the space”, which includes channeling the organization’s purpose. And it is remarkable how in self-managing organizations, even that role is light touch, at least for what I have seen, and you hint to that too. In pyramidal structures, so many decisions get made at the top, so a lot of sourcing is needed from the source, so to speak. In self-managed organizations, it’s amazing how sub-sources can suddenly open up their channels wide too.

3. Discovering

You do not invent a higher purpose; it already exists. You can discover it through empathy—by feeling and understanding the deepest common needs of your workforce. That involves asking provocative questions, listening, and reflecting.

Creating a Purpose-Driven Organization, by Robert E. Quinn, a professor emeritus at the University of Michigan’s Ross School of Business, and Anjan V. Thakor, the John E. Simon Professor of Finance and the director of doctoral programs at the Olin Business School at Washington University in St. Louis, on Harvard Business Review
The company is viewed as a manifestation of the need or vision of the ‘source’, the individual who took the first step — some kind of risk — to bring the initiative to life. By understanding the source’s need or vision, you discover the purpose.
Meanwhile, everyone else in the company has their own needs, vision or calling in life too. If they sense the company is a good place for them to bring their own vision to life, whilst serving the need/vision of the source then a state of flow and fulfilment follows.
This school of thought is based on Peter Koenig’s ongoing research with founders, which he has developed into a set of ‘source principles’.
I see this model also having an organic metaphor, but rather than an ecosystem, it’s a ‘spiral of life’, with ever more rich, complex life branching out from a source.

– Tom Nixon, Where does the purpose of a company come from?

Discovery is clearly Tom Nixon’s preferred approach, although he stresses that all three options are simply conceptual frameworks and that, regardless of the chosen option, the resulting declaration of purpose must display authenticity and clarity. “There’s no absolute right or wrong because companies are stories — products of our consciousness — so there is no law of nature we can defer to for a final answer.”

My own preference, at least as a a default option, is the purpose quest —a facilitated discovery process with a participant group that represents a microcosm of the enterprise. Its members will include the CEO, other C-level executives, and people from all organizational functions and at every level of seniority. The participant group can be whatever size it needs to be—typically between 50 and 100 people.

Microcosm of the enterprise
Ideally, rank-and-file employees will be elected representatives, acting on behalf of the electorate and reporting back with news of what emerged from the quest. All relevant factors will have been taken into account, such as origin story (for example, Bill Hewlett and David Packard in the Palo Alto garage, including the founders’ motivations and vision), key chapters and events in the backstory, and the perspectives and experiences of individual customers, suppliers, and members of other stakeholder groups.

I believe that when purpose is elicited in this way, it stands a very good chance of being expressed truthfully, coherently and compellingly, and the prospect of rapid and frictionless enterprise-wide adoption is maximised.


Here are two very different ways of thinking about vision:

The conventional way

Vision is an aspirational description of what an organisation would like to achieve or accomplish in the mid-term or long-term future. It is intended to serve as a clear guide for choosing current and future courses of action.
Source: BusinessDictionary, cited on Wikipedia
In this version, the vision is inward-looking and self-serving. The value beneficiary is the enterprise. There is no mention of generating value for the wider ecosystem.

The vision statement is a proxy for a desired future.

Another way

Vision is an imagined scenario of realised potential; a depiction of how the world (customers, other stakeholders and wider society) will be enriched when the enterprise is deploying its value generation capability without constraint and living its purpose to the full.

Depiction means an actual picture accompanied by vivid explanatory text, a compelling synopsis of the imagined scenario. Picture first, then words.

In this version, the vision is outward-looking and manifested through service to others. Its focus is the entire ecosystem of which the enterprise is but one interdependent part. The value beneficiaries are stakeholder group members, with value accruing to the enterprise as a natural consequence of its ecosystem enrichment activities.

Whereas purpose is a now-and-always statement, vision is an expression of a desired state of affairs that the enterprise seeks to turn into reality as quickly as possible. If your wish were to be granted, you would wake up tomorrow morning to find an overnight miracle had occurred and the desired state of affairs had become reality.

The vision of realised potential is therefore a proxy for a desired present, not a desired future.

How vision is determined

The vision of realised potential can be determined by means of a vision quest. The process is very similar to that of the purpose quest I described earlier.


There is little agreement about what strategy is. In his classic text The Rise and Fall of Strategic Planning, management academic and author Henry Mintzberg offers five ways of viewing the concept:

Plan A course of action designed to achieve an objective.

Ploy A maneuver for outwitting an opponent.

Pattern Consistency in behaviour.

Position Location in a conceptual space relative to competitors.

Perspective A shared worldview.

Other luminaries, such as Roger Martin, Gary Hamel, Michael Porter, Rita Gunther McGrath and Ken Favaro, provide their own interpretations of strategy.

This comes closest to the way I currently think about the topic:

Strategy is a cohesive response to an important challenge.
Three things make up the ‘kernel’ of good strategy:
1. A diagnosis.
An explanation of the nature of the challenge. A good diagnosis simplifies the often overwhelming complexity of reality by identifying certain aspects of the situation as being the critical ones.
2. A guiding policy.
An overall approach chosen to cope with or overcome the obstacles identified in the diagnosis.
3. A set of coherent actions.
Steps that are coordinated with one another to support the accomplishment of the guiding policy. These are not ‘implementation’ details; they are “the punch in the strategy”.

Main source: The perils of bad strategy, by Richard Rumelt, author of Good Strategy, Bad Strategy, in McKinsey Quarterly, June 2011
If strategy is a response to an important challenge (Rumelt) and mission is a response to an important challenge (Leith; see next section), then strategy and mission are simply different names for the same means-to-an-end.

It all depends on context. When I’m in America I call it the sidewalk. When I’m in the UK I call it the pavement. But no matter what I call it, the hard surface beneath my feet still enables me to get from A to B.

It could be said that strategy is the pre-work for a mission, and that mission is the strategy in action, but in practice we’re talking about one continuous process, as illustrated here:


Ask: What is preventing you from realising the vision, or some significant aspect of it, right now?

What are the critical constraints that, once removed, will clear the way for realising the vision or some major aspect of it?

Note that absence of an essential resource, such as money, expertise or technology, counts as a constraint.

Broad approach

Ask: How can the constraints be removed?

In contrast to the depiction of strategy as abstract theory detached from so‑called ‘execution’, strategy is a course of action. The distinction between strategy and execution, between theory and practice, between the abstract and the concrete, thinking and doing, simply does not exist.
Martin Weigel

Source: Why ‘strategy’ does not exist. And everything is strategic. By Martin Weigel, Head of Planning, Wieden+Kennedy Amsterdam


A set of coherent actions
As used here, the term ‘mission’ comes from the field of space exploration. It is not a synonym for vision or purpose, and it is not about mission statements.
Mission Statement, by Tom Fishburne

Credit: Tom Fishburne
I believe that this nation should commit itself to achieving the goal, before this decade is out, of landing a man on the moon and returning him safely to the earth. No single space project in this period will be more impressive to mankind, or more important for the long-range exploration of space; and none will be so difficult or expensive to accomplish.

President John F. Kennedy, 25 May 1961 (view longer excerpt from the Special Message to the Congress on Urgent National Needs)
In the context of generative enterprise, a mission is a programme of sustained collaborative action forming a detailed response to an important business challenge. At the highest level of abstraction, the challenge is ‘realise the vision’ or a major part of it.

Example of a management challenge

“In order to satisfy the rapidly changing needs of our clients, I want to merge our six operating units — creative, media, digital, data and analytics, PR, and branding — into a single business, with one identity, one CEO, one P&L and one office. However, I know that if I implement this plan our divisional CEOs will head straight for the exit. But if I don’t pursue this course of action our clients will head in the same direction and we’ll be out of business. How can we escape from this Catch-22 situation?”

– CEO of a fictional advertising and marketing services group. (Note: I devised this example before the restructuring of Ogilvy’s UK business was announced. Any similarity is coincidental.)

A management challenge at six levels of abstraction
The mission objective is to surmount the challenge and bring about a specific outcome. Essential elements include the completion date (“before this decade is out”) and a set of evidence-based success criteria.

The mission plan describes how the mission objective will be accomplished.

In 2011 Bas Lansdorp and Arno Wielders lay the foundation of the Mars One mission plan. Discussion meetings are held with potential suppliers of aerospace components in USA, Canada, Italy and United Kingdom. Mission architecture, budgets and timelines are solidified from feedback of supplier engineers and business developers. A baseline design for a mission of permanent human settlement on Mars achievable with existing technology is the result.

Source: Mars One website
Two types of enterprise mission

The first type is a response to a challenge that is preventing the enterprise from realising its vision or some major part of it. In some cases, the challenge will take the form of an insurmountable opportunity. This type of mission is conducted by a subset of the workforce.

The second type of mission translates the top-level corporate strategy into a programme of concerted collaborative action. Such a mission is a highly ambitious undertaking, the accomplishment of which will benefit humanity in a profound way, and every employee is involved in it to a greater or lesser extent.

No matter what form innovation takes — short, agile sprints or long-term, grand-challenge investments — innovation is fundamentally about solving problems. And the bigger the problems you choose to tackle, the larger the potential payoff. Pursuing a grand challenge won’t improve your results next quarter, but it might just take your enterprise to a whole new level.
Greg Satell
– Greg Satell, Why the Rewards for Ambitious Problem Solving Are About to Get Bigger, on Harvard Business Review
Missions, sub-missions and projects
The most important job of any manager is to break down a situation into challenges that subordinates can handle. In essence, the manager absorbs a good chunk of the ambiguity in the situation and gives much less ambiguous problems to others.
In a focused company, the CEO does this for the entire organization by examining the overall competitive situation and providing enough guidance to let the organization get to work. The CEO defines the business problem for everyone else.

Richard Rumelt, Strategy’s strategist: An interview with Richard Rumelt, in McKInsey Quarterly, November 2007

Maptio, an online tool developed by Tom Nixon (see earlier section on determining purpose) promises to be an effective way of keeping track of the sub-missions and collaborative projects that contribute to the mission. Tom Nixon uses the terms vision and initiatives, but the labels aren’t that important—what matters is what the labels represent.
Maptio screenshot
Find out more about Maptio
This second kind of mission mobilizes the strategy, and, once accomplished, manifests the enterprise’s vision, either in whole or in part.
Each mission has the aim of more fully realising the enterprise’s vision
As employees make their contributions to projects that feed into sub-missions—and, thereby, to the overall mission—they are animating the purpose of the enterprise, moment by moment.
Missions, sub-missions and projects
In the following graphic:

  • 1 million people living on Mars is the mission.
  • Figure out how to put things in space is sub-mission no.1.
  • Revolutionize the cost of space travel is sub-mission no.2.
  • Colonize Mars is sub-mission no.3.
SpaceX Business Plan

Source: Wait But Why
Each sub-mission will consist of many projects, but there will be a clear line of sight from even the smallest project to the overall mission, and every project team member will be ever aware of how his or her efforts are contributing to the mission.

This is a real-world exemplification of the parable in which a mason said he wasn’t just cutting stone—he was building a cathedral.

Collaborative project work
(a.k.a. co-creation)

Collaborative projects are the principal means by which a generative enterprise accomplishes its mission.

Although I sometimes use the word collaboration, mostly I speak about co-creation. In a generative enterprise, participants in a co-creation project work together from the outset with the aim of generating maximum value for customers, other stakeholders, and wider society. Participants means all those whose contribution, co‑operation and consent are vital to the successful accomplishment of the project.

Contribution means taking action to accomplish the desired outcome, or providing ideas, knowledge and expertise.

Co‑operation means giving assistance and enabling progress, or not blocking progress by saying “No”.

Consent means saying “Yes”; giving formal or informal approval for a proposed course of action.

This is part of a set of generative intervention principles that emerged from research, experimentation and client work conducted by various people including me over the course of four decades. View the principles of generative intervention

More quotes

Overall a purpose has three functions:

Purpose declares intent. The more meaningful a purpose is the greater its motivational pull. Striving to be number one in an industry is not a purpose. Purpose is a consistent and enduring promise to your stakeholders. Articulating clearly why your organisation exists and which difference it wants to make in people’s lives, helps create a company with a distinguishing cause.

Purpose shapes strategy. A purpose gives people a frame of reference and a filter through which they can pass strategic decisions. A clear understanding of purpose and its underlying values serve as a moral compass. It helps people decide if they are doing the right things and tell them which businesses they should be getting into, and how they should be running them.

Purpose provides perspective. A purpose reminds people why they do things, not what they do. It binds the past, present and future together, and galvanises the organisational culture. By actively aiming to create a better tomorrow and leaving a positive legacy it is directed towards meeting the needs of a wider community beyond a company’s walls.

Source: Purpose Parasites, by Kenneth Mikkelsen, on Global Peter Drucker Forum

Further reading

Big Business Has a New Scam: The ‘Purpose Paradigm’, by Maria Hengeveld, on The Nation

The business case for purpose (pdf; 20pp) | Harvard Business Review Analytic Services report, in association with EY Beacon Institute

The Collaboration Blind Spot, by Lisa B. Kwan, on Harvard Business Review

Connecting the dots: how purpose can join up your business | PwC report

Don’t forget the humans: Keeping the organisational soul in its right place, by Tom Nixon, on Medium

Employee Purpose is Driving Company Purpose—What Human Resources Executives Need to Know, by Lanier Robertson, Vice President, Human Resources, Covestro LLC, on HR Technologist

Evolving to a New Dominant Logic for Marketing, by Stephen L. Vargo and Robert F. Lusch, in Journal of Marketing, Vol. 68 (January 2004), 1–17

EY Beacon Institute | “Dedicated to thoughtful inquiry to redefine what it means to be a successful company” | Links to thoughtful articles on business purpose

The new era of purpose can change the world for good, by Lewis Iwu, Daniela Flores, and Barry Johnston, co-founders of Purpose Union

The perils of bad strategy, by Richard Rumelt, author of Good Strategy, Bad Strategy, in McKinsey Quarterly, June 2011

Purpose Parasites, by Kenneth Mikkelsen, on Global Peter Drucker Forum

The Rise and Fall of Strategic Planning, by Henry Mintzberg

The Role of Visioning in Design, by Daniel Christian Wahl

Strategy’s strategist: An interview with Richard Rumelt, in McKInsey Quarterly, November 2007

A typology of organisational cultures (pathological, bureaucratic, and generative), by Robert Westrum, in Quality and Safety in Health Care, January 2004

Where does the purpose of a company come from?, by Tom Nixon, founder of Maptio

Who are your anti-clients? by Tom Graves, Tetradian Consulting

Why ‘strategy’ does not exist. And everything is strategic. By Martin Weigel, Head of Planning, Wieden+Kennedy Amsterdam

This article is in permanent beta, the same as everything I write.

Please send me a note if you spot an error, a confusing piece of writing, or anything else that needs my attention.

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