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how do you explain when things don't go
as we assumed or better how do you
explain when others are able to achieve
things that seem to defy all of the
assumptions for example why is Apple so
innovative year after year after year
after year they're more innovative than
all their competition and yet they're
just a computer company they're just
like everyone else they have the same
access to the same talent the same
agencies the same consultants the same
media then why is it that they seem to
have something different why is it that
Martin Luther King led the civil rights
movement he wasn't the only man who
suffered in a pre-civil Rights America
and he certainly wasn't the only great
orator of the day why him and why is it
that the Wright brothers were able to
figure out control powered man flight
when there were certainly other teams
who were better qualified but her funded
and they didn't achieve powered man
flight the Wright brothers beat them to
it there's something else at play here
about three and a half years ago I made
a discovery and this discovery
profoundly changed my view on how I
thought the world worked and it even
profoundly changed the way in which I
operated it as it turns out there's a
pattern as it turns out all the great
and inspiring leaders and organizations
in the world whether it's Apple or
Martin Luther King or the Wright
brothers they all think act and
communicate the exact same way and it's
the complete opposite to everyone else
all I did was codify it and it's
probably the world's simplest idea I
call it the Golden Circle
why how what this little idea explains
why some organizations and some leaders
are able to inspire where others aren't
let me define the terms really quickly
every single person every single
organization on the planet knows what
they do 100 percent some know how they
do it would you call it your
differentiating value proposition or
your proprietary process or your USP but
very very few people or organizations
know why they do what they do and by why
I don't mean to make a profit that's a
result it's always a result by why I
mean what's your purpose what's your
cause what's your belief why does your
organization exist why do you get out of
bed in the morning and why should anyone
care well as a result the way we think
the way we act the way we communicate is
from the outside and it's obvious we go
from the clearest thing to the fuzziest
thing but the inspired leaders and the
inspire or inspired organizations
regardless of their size regardless of
their industry all think act and
communicate from the inside out let me
give you an example I use Apple because
they're easy to understand and everybody
gets it if Apple were like everyone else
a marketing message from them might
sound like this we make great computers
they're beautifully designed simple to
use and user friendly want to buy one
and that's how most of us communicate
that's how most marketing is done that's
how most sales done and that's how most
of us communicate interpersonally we
save what we do we say how we're
different or how we better and we expect
some sort of behavior or purchase a vote
something like that here is our new law
firm we have the best lawyers with the
biggest clients we have you know we
always perform for our clients do
business with us here's our new car it
gets great gas mileage it has you know
leather seats by our car but it's
uninspiring here's how Apple actually
communicates
everything we do we believe in
challenging the status quo we believe in
thinking differently the way we
challenge the status quo is by making
our products beautifully designed simple
to use and user friendly we just happen
to make great computers wanna buy one
totally different right you ready to buy
a computer from me all I did was reverse
the order of the information what it
proves to us is that people don't buy
what you do people buy why you do it
people don't buy what you do they buy
why you do it
this explains why every single person in
this room is perfectly comfortable
buying a computer from Apple but we're
also perfectly comfortable buying an mp3
player from Apple or a phone from Apple
or a DVR from Apple but as I said before
Apple is just a computer company there's
nothing that distinguishes them
structurally for many of their
competitors their competitors are all
equally qualified to make all of these
products in fact they tried a few years
ago gateway came out with flat-screen
TVs they're eminently qualified to make
flat-screen tvs they've been making some
flat-screen monitors for years nobody
bought one Dell came out with mp3
players and PDAs and they make great
quality products and they can make
perfectly well design products and
nobody bought one in fact talking about
it now we can't even imagine buying an
mp3 player from Dell why would you buy
an mp3 player from a computer company
but we do it every day people don't buy
what you do they buy why you do it the
goal is not to do business with anybody
with everybody who needs what you have
the goal is to do business with people
who believe what you believe
here's the best part none of what I'm
telling you is my opinion it's all
grounded in the tenets of biology not
psychology biology if you look at a
cross-section of the human brain looking
from the top down what you see is the
human brain is actually broken into
three major components that correlate
perfectly with the golden circle our
newest brain our Homo Sapien brain our
neocortex corresponds with the what
level the neocortex is responsible for
all of our rational and analytical
thought
and language the middle two sections
make up our limbic brains and our limbic
brains are responsible for all of our
feelings like trust and loyalty it's
also responsible for all human behavior
all decision-making and it has no
capacity for language in other words
when we communicate from the outside in
yes people can understand vast amounts
of complicated information like features
and benefits and facts and figures
it just doesn't drive behavior when we
communicate from the inside out we're
talking directly to the part of the
brain that controls behavior and then we
allow people to rationalize it with the
tangible things we say and do this is
where gut decisions come from you know
sometimes you can give somebody all the
facts and your figures in these I know
what all the facts in detail say but it
just doesn't feel right why would we use
that verb it doesn't feel right
because the part of the brain that
controls decision-making doesn't control
language and the best we can muster up
is I don't know it just doesn't feel
right or sometimes you say you're
leading with your heart or you're
leading with your soul well I hate to
break it to you those aren't other body
parts controlling your behavior it's all
happening here in your limbic brain the
part of the brain that controls
decision-making and not language but if
you don't know why you do what you do
and people respond to why you do what
you do then how will anybody how will
you ever get people to vote for you or
buy something from you or more
importantly be loyal and want to be a
part of what it is what you bet you do
again the goal is not just as to sell
people who need what you have the goal
is to sell to people who believe what
you believe the goal is not just to hire
people who need a job it's to hire
people who believe what you believe I
always say that you know this if you if
you if you hire people just because they
can do a job they'll work for your money
but if you hire people who believe what
you believe they work for you with blood
and sweat and tears and no air nowhere
else is there a better example of this
than with the Wright brothers most
people don't know about Samuel Pierpont
Langley and back in the early 20th
century the pursuit of powered man
flight was like the dot-com of the day
everybody was trying it and Samuel
Pierpont Langley had what we assume to
be the recipe for success
I mean even now we you asked people why
did your product or why did your company
fail and people always give you the
permeate same permutation of the same
three things undercapitalized
the wrong people bad market conditions
it was the same three things so let's
explore that Samuel Pierpont Langley was
given fifty thousand dollars by the War
Department to figure out this flying
machine money was no problem he held a
seat at Harvard and worked at the
Smithsonian and was extremely
well-connected he knew all the big minds
of the day he hired the best minds money
could find and the market conditions
were fantastic
the New York Times followed him around
everywhere and everyone was rooting for
Langley and how come we've never heard
of Samuel Pierpont Langley a few hundred
miles away in Dayton Ohio Orville and
Wilbur Wright they had none of what we
consider to be the recipe for success
they had no money they paid for their
dream with the proceeds from their
bicycle shop not a single person on the
Wright brothers team had a college
education
not even Orville or Wilbur and the New
York Times followed them around nowhere
the difference was Orville and Wilbur
were driven by a caused by a purpose by
a belief they believed that if they
could figure out this flying machine
it'll change the course of the world
Samuel Pierpont Langley was different he
wanted to be rich and he wanted to be
famous he was in pursuit of the result
he was in pursuit of the riches and lo
and behold look what happened the people
who believed in the Wright brothers
dream worked with them with blood and
sweat and tears the others just worked
for the paycheck and they tell stories
of how every time the Wright brothers
went out they would have to take five
sets of parts because that's how many
times they would crash before they came
in for supper and eventually on December
17th 1903 the Wright brothers took
flight
and no one was there to even experience
it we found out about it a few days
later and further proof that Langley was
motivated by the wrong thing the day the
Wright brothers took flight he quit he
could have said that's an amazing
discovery guys and I will improve upon
your technology but he didn't he wasn't
first he didn't get rich he didn't get
famous so he quit people don't buy what
you do they buy why you do it and if you
talk about what you believe you will
attract those who believe what you
believe well why is it important to
attract those who believe what you
believe something called the law of
diffusion of innovation and if you don't
know the law you definitely know the
terminology the first two and a half
percent of our population are our
innovators the next thirteen and a half
percent of our population are our early
adopters the next thirty four percent
are your early majority your late
majority and your laggards the only
reason these people by touch-tone phones
is because you can't buy rotary phones
anymore
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we all sit at various places at various
times on the scale but with the law of
diffusion of innovation tells us is that
if you want mass-market success or
mass-market acceptance of an idea you
cannot have it until you achieve this
tipping point between 15 and 18 percent
market penetration and then the system
tips and I love asking businesses what's
your conversion on new business and they
love to sell you oh it's about 10
percent proudly well you can trip over
10 percent of the customers we all have
about 10 percent who just get it that's
how we describe them right that's like
that gut feeling oh they just get it the
problem is how do you find the ones that
just get it before you're doing business
with them versus the ones who don't get
it
so it's this here this little gap that
you have to close as Jeffrey Moore calls
it crossing the chasm because you see
the early majority will not try
something until someone else has tried
it first and these guys the innovators
in the early adopters they're
comfortable making those gut decisions
they're more comfortable making those
intuitive decisions that are driven by
what they believe about the world and
not just what product is available these
are the people who stood on line for six
hours to buy an iPhone when they first
came out when you could have just walked
into the store the next week and bought
one off the shelf these are the people
who spent $40,000 on flat-screen TVs
when they first came out even though the
technology was substandard and by the
way they didn't do it because the
technology was so great they did it for
themselves it's because they wanted to
be first people don't buy what you do
they buy why you do it and what you do
simply proves what you believe in fact
people will do the things that prove
what they believe the reason that person
bought the iPhone on the first in the
first six hours a student stood in line
for six hours was because of what they
believed about the world and how they
wanted everybody to see them they were
first people don't buy what you do they
buy why you do it so let me give you a
famous example a famous failure and a
famous success of the law of diffusion
of innovation first the famous failure
it's a commercial example as we said
before a second ago the recipe for
success is money and the right people in
the right market
right you should have success then look
at TiVo from the time TiVo came out
about eight or nine years ago to this
current day they are the single highest
quality product on the market hands down
there is no dispute they were extremely
well-funded market conditions were
fantastic I mean we use TiVo as a verb
like TiVo stuff on my piece of junk Time
Warner DVR all the time but TiVo is a
commercial failure they've never made
money and when they went IPO their stock
was at about 30 or $40 and then
plummeted and it's never traded above
ten in fact I don't thinks it's even
traded above six except for a couple of
little spikes because you see when TiVo
launched their product they told us all
what they had they said we have a
product that pauses live TV skips
commercials rewinds live TV and
memorizes your viewing habits without
you even asking and the cynical majority
said we don't believe you we don't need
it we don't like it you're scaring us
what if they had said if you're the kind
of person who likes to have total
control over every aspect of your life
boy do we have a product for you it
pauses live TV skips commercials
memorizes your viewing habits etc etc
people don't buy what you do they buy
why you do it and what you do simply
serves as the proof of what you believe
now let me give you a successful example
of the law of diffusion of innovation in
the summer of 1963 250,000 people showed
up on the mall in Washington to hear dr.
King speak they sent out no invitations
and there was no website to check the
date how do you do that well dr. King
wasn't the only man in America who was
the who's a great orator he wasn't the
only man in America who suffered in a
pre-civil Rights America in fact some of
his ideas were bad but he had a gift he
didn't go around telling people what
needed to change in America you know he
went around and told people what he
believed
I believe I believe I believe he told
people and people who believe what he
believed took his cause and they made it
their own and they told people and some
of those people created structures to
get the word out to even more people and
lo and behold 250,000 people showed up
on the right day on the right time to
hear him speak how many of them showed
up for him
zero they showed up for themselves it's
what they believed about America that
got them to travel on a bus for eight
hours to stand in the Sun in Washington
for in the middle of August it's what
they believed and it wasn't about black
versus white 25 percent of the audience
was white dr. King believed that there
were two types of laws in this world
those that are made by a higher
authority Authority and those that are
made by man and not until all the laws
that are made by man are consistent with
the laws that are made by the higher
authority will we live in a just world
it just so happens that the civil rights
movement was the perfect thing to help
him bring his cause to life we followed
him not for him but for ourselves and by
the way he gave the I have a dream
speech not the I have a planned speech
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listen to politicians now with the
comprehensive 12-point plans are not
inspiring anybody because there were
leaders and there are those who lead
leaders hold a position of power or
authority but those who lead inspire us
with other individuals or organizations
we follow those who lead because we have
to but because we want to we follow
those who lead not for them but for
ourselves and it's those who start with
Y that have the ability to inspire those
around them or find others who inspire
them thank you very much
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shirring that's video on the human
Network Cisco welcome to the human
Network