Creating Magnetic Organizations

A CEO called.  In our conversation he shared a classic story.  After he founded, grew, and sold his first company, he took several years to think and learn.  He came to a vision of a core future need in his industry.  Based on the vision, in 2012, he founded a new company.  As he pressed forward, his vision was confirmed.  Measures showed the new company was helping customers succeed at a level ten times the industry average.

This should have created great growth.  It did not.  The vision was radical and way ahead of the time.   Customers were reluctant, so the company plodded along.

Then there were some typical speed bumps, and the CEO was forced into deep reflection.  In the process, he said that he read two of my books, The Positive Organization and The Economics of Higher Purpose.

He felt like they were written for him.  He determined to build a company with a positive culture, and a company driven by a higher purpose.  His corporate purpose was “To grow leaders who grow organizations that change the world.”  He thought this would be appealing to all.  He was wrong.

Thoreau once wrote, “Action from principle, the perception and the performance of right, changes things and relations; it is essentially revolutionary, and does not consist wholly with anything that was.  It not only divides states and churches, but it also divides families; aye, it divides the individual, separating the diabolical in him from the divine (Thoreau, Civil Disobedience).”

When a CEO embraces higher purpose, the CEO is engaging in action from principle.  The CEO is creating a new more moral organization.  It is not reflective of what was.   The act is revolutionary and not everyone can believe and respond positively.  To the surprise of the CEO, three of his senior people quit, a board member resigned, and the bank withdrew financial support.  Things and relationships were being altered.  This repulsion stunned the CEO.   He had to endure “the dark night of the soul.”

He said he was lonely but never fearful.  When it became clear that he had to personally provide the financial backing for the company, he did not hesitate.  He was fully committed to the purpose and the vision.

He said, “Despite living through my darkest hour with many sleepless nights, I developed a deep, deep faith in being positive and purpose driven.  I wove positive principles into every company meeting and never missed a chance to tell a participant story that made clear we were delivering on our purpose “to grow leaders who grow organizations that change the world.”

Notice a consistency with the last blog.  Crisis is the time in which a leader embraces an authentic, higher purpose, and uses it to govern every action.  This gives rise to a new culture and to collective commitment.

Goethe said, “At the moment of commitment the entire universe conspires to assist you.”  This accurate observation seems to contrast with the accurate observation of Thoreau.  I believe both to be correct.

At the moment of commitment there are many dynamics, including repulsion and attraction.  At first, the repulsive patterns may be most visible, but attractive processes are also emerging.   While three key people left, many of the remaining employees were delighted.  They stepped forward showing a new level of engagement and contribution.  Because the new order was emergent, it was not immediately apparent.  Yet the attractive process was real and contagious.  It spread among employees, suppliers, customers, and other stake holders.  The social network was becoming purposive, aligned, and attractive.

The phone started ringing.  Customer demand dramatically increased.  Numerous people from the investment community came forth with offers to buy all or part of the company.  Opportunities were suddenly everywhere.

To explain the latter transformation, the CEO kept using the word magnetism.  He said, “We implemented the principles of purpose completely and it changed our culture.  It enabled us to deliver at a higher level than ever before.  We became part of a virtuous cycle that spun and spun, we became a magnetic system.”

Here are two definitions of the word magnet: First, “a piece of iron (or an ore, alloy, or other material) that has its component atoms so ordered that the material exhibits properties of magnetism, such as attracting other iron-containing objects or aligning itself in an external magnetic field.”  The ordering is internal.  All the electrons are aligned and spinning in the same direction.  This creates an attractive force.

A second definition is, “A person or thing that has a powerful attraction.”  A leader can be fixed on an egotistical intention and try to control people through hierarchical power.  This is a conventional pattern.  Such a person does not have the power of attraction.  They have the power of force.  The employees tend to give their bodies as required but not their hearts.

In contrast, leaders can become authentically wedded to a higher purpose.  A higher purpose is a collective contribution to the common good.  The leader becomes different from conventional authority figures.   The leader becomes a magnet that repels some and attracts others.  The new dynamics are a form of emergent change.  The process is not controlled from the top.  A new order is emerging from thousands of new interactions in which the people are aligning themselves.  Of their own freewill, they choose to sacrifice for the purpose, taking initiative they would not otherwise take.  Expectations change.  A more positive and adaptive culture emerges.

This aligned internal behavior attracts the attention of outsiders.  The outsiders notice the new, unconventional patterns.  As they do, they come to value and respect the system that is suddenly and uniquely serving them.  These outsiders begin to psychologically align with and commit to the organization.  The legal boundaries of the organization still exist, but in behavioral reality there is now a larger, dynamic system that transcends the boundaries of the organization.  Employees, customers, suppliers, and other stake holders are becoming a community of mutually attractive actors.  The magnetic organization begins to grow at a rate beyond expectations.



  • Why does action from principle create divisiveness?
  • At the moment of authentic commitment what begins to work in your favor?
  • What does it mean for an organization or team to become magnetic?
  • How could we use this passage to create a more positive organization?