Purpose: The Gateway To Becoming an ExO
Purpose-driven organizational culture is the ultimate competitive advantage
The article you are about to read after this short introduction is the fifth chapter of my new book, "Pictorial Atlas of 101 Purpose Statements From Around The World: Navigating Individuals and Organizations to the Discovery of Purpose."
As an ExO-certified Sprint Coach, Trainer, Consultant, and Ambassador I am happy to share it with the OpenExO community to which I belong.
It's a way to give back to this amazing global community of innovators because the ExO Model allowed me to discover the MTP (Massive Transformative Purpose) concept that was instrumental in falling in love with the topic of purpose-driven organizational culture: the only gateway to becoming exponential.
I believe there is a huge space to successfully implement the ExO Model among SMEs, and to prepare entrepreneurs for the future of business building—one that is firmly purpose-driven and leverages exponential technologies.
The book is already available on Amazon for pre-order and will launch on October 20. It's a pioneering visual collection, the first of its kind publication—compiled over two years of extensive research—and collects purpose statements from 22 countries worldwide.
Featuring 101 illustrated purpose statements, this collection is organized with rankings and 11 thematic chapters, allowing readers to explore at their own pace. It aims to spark curiosity about how purpose shapes organizational culture and offers insights from years of research and practice.
To gain further insights into the impact of this work, I invite you to visit the "Our Books" page on the Purpose-Driven Academy's website to read what leaders are saying about the book. Their perspectives offer a glimpse into the practical applications and transformative potential of the ideas presented in this chapter and the broader work.
Chapter 5 - Purpose: the gateway to becoming an ExO
Throughout history, the decreasing time gap between major inventions highlights the exponential path of scientific progress and technological development rather than a linear one.
From the invention of the first printing press in 1453, it took 312 years to see the first steam engine in 1765, which marked the first Industrial Revolution. Another 114 years later, in 1879, electricity, the internal combustion engine, and mass production characterized the Second Industrial Revolution. Just 68 years later, in 1947, the Third Industrial Revolution began, featuring electronics, computing, automation, and telecommunications. These innovations profoundly transformed and improved living conditions in much of the world.
A few decades later, before the end of the last century and the beginning of the new millennium, the Fourth Industrial Revolution began. Unlike the previous ones, it is characterized by an ever-increasing number of advanced digital technologies integrated with the physical, biological, and technological worlds, such as:
• Internet of Things (IoT)
• Artificial Intelligence (AI) and Machine Learning
• Big Data and Analytics
• Blockchain
• Augmented Reality (AR) and Virtual Reality (VR)
• Advanced Robotics
• 3D and 4D Printing
• Nanotechnology and Biotechnology
• Renewable Energy and Smart Grids
• 5G and Advanced Communications
The future outcome of this unprecedented scientific and technological development is simply unpredictable.
Today, we can only note the already profound economic, social, and political implications impacting large corporations, small- and medium-sized enterprises (SMEs), and people´s daily lives.
In the past 60 years, nearly 90 percent of Fortune 500 companies have disappeared, and it is predicted that another 40 percent will vanish in the next 10 years, replaced by new companies—many of which do not yet exist.
The average lifespan of companies in the S&P 500 has dropped from 67 to 15 years and is quickly approaching 10 years. Only 25% of new SMEs surpass their fifth year of existence.
What is happening? Have entrepreneurs suddenly lost their ability to do their jobs? Many companies of all sizes and in every market have disappeared not because they lacked the means to transform (think about Kodak or Blockbuster), but due to their inability to understand the change.
They disappeared simply because they did not want to change. They failed to adapt to reality, and by believing they could succeed by continuing in the only way they knew, they ended up being overwhelmed by change.
Unfortunately, many more will disappear due to this inability to read and understand the dynamics of the new millennium and the incapacity to learn to survive and thrive in an increasingly unpredictable, complex, and volatile context.
Since new problems require new solutions, approaches, tools, and methods, those unable to adapt and abandon obsolete organizational models based on stability and predictability will succumb, making way for new types of organizations, such as Exponential Organizations (ExOs).
These are organizations designed to leverage the accelerating technologies of the Fourth Industrial Revolution to achieve tenfold growth and impact compared to traditional competitors.
ExOs represent the answer to the constantly evolving context. Thanks to this characteristic, they grow and thrive in the current complex and unpredictable environment.
The ExO model was born from studying the characteristics that enabled a hundred startups worldwide to flourish in ways and dimensions never seen before, despite sharing the same conditions as any other startup or company.
From understanding the common traits of these startups, Salim Ismail, an entrepreneur also known for co-founding Singularity University, formulated the Exponential Organizations model illustrated in his bestseller Exponential Organizations (2014).
His first book (which was updated in 2023 with the new title Exponential Organizations 2.0) introduced the concept of ExOs, a new organizational model that allows companies to grow 10 times faster than any competitor while reducing the cost of supply to almost zero by leveraging exponentially accelerating technologies.
“An ExO is a purpose-driven, agile, and scalable organization that uses accelerating technologies to digitize, dematerialize, democratize, and demonetize its products and services, resulting in a 10x performance increase over its non-ExO peers.“ (The updated definition in the latest 2023’s book.)
In another book Exponential Transformation (2019), along with other co-authors, Ismail proposes a detailed plan to transform traditional organizations into ExOs, following a roadmap that guides companies through the transformation process.
The aim is to transform organizations from within by enabling people to adopt a new mindset—one that pushes them to seek new perspectives to solve problems and face the challenges of an increasingly complex and unpredictable context.
In summary, the ExO model presents itself as a cultural transformation model: it is a proposal to change the perspective with which we look at the world and decipher its dynamics. Indeed, as Albert Einstein reminds us, if we do not change our way of thinking, we will not solve the problems we have caused with that same way of thinking.
The abundance of resources in the world, amplified by accelerating technologies, demands new organizational models for one to access available resources and learn to thrive in unpredictability.
“Exponential transformation is not just about creating new tools; it is a new approach, a new method to tackle challenges. It doesn’t matter if the world of tomorrow is ever-changing. What matters is being equipped to face the never-normal.” — Francesco Derchi
Is there a formula for becoming an ExO?
It consists of 1+10 components or attributes that allow the creation of an Exponential Organization.
The first mandatory element is the Massive Transformative Purpose (MTP).
Exponential Organizations operate guided and inspired by an MTP, which defines the impact they want to have on the world and directs their goals and choices, attracting and retaining top talent like a magnet.
The MTP expresses the reason why the entrepreneurial project is created and its intention to positively impact people’s lives. It also expresses the impossible dream that the founder or founders want to achieve, and what the project aspires to become in the future for customers, collaborators, investors, and its entire ecosystem.
Peter Diamandis clarifies that the MTP inspires the existence of the entrepreneurial project by leveraging an individual´s pre-existing passion for an important problem they want to solve in society.
In turn, the MTP can attract and retain people aligned with the values that inspire the desire to solve that particular problem in society.
As the definition suggests, an ExO is a purpose-driven organization, inspired by the awareness of its reason to exist and the desire to transform a significant problem into an opportunity that improves people's quality of life.
This helps us understand that the purpose (or MTP) is “the” entry point, the gateway—the only one—to become an ExO.
If the entry point to becoming an ExO is the MTP, the first step towards the exponential transformation of the organization is to identify purpose and activate it, before considering any other component of the ExO Formula.
And this is for two good reasons:
First, as we have just seen, the ExO model transforms organizations from within by working on people’s mindsets, helping them find new perspectives to solve problems.
We have also seen that it presents itself as a method to tackle the challenges of the new millennium, and as a tool for cultural transformation.
Second, as we have seen in the first chapter, leveraging purpose-driven organizational culture means laying the groundwork for impactful digital transformation that creates long-term value for all actors in the ecosystem.
The other 10 components of the ExO Formula represented in the ExO Canvas** are divided into two groups of five exponential levers or attributes identified by two acronyms: SCALE and IDEAS.
The first group, SCALE, identifies the attributes connecting the organization with the abundance of resources and data in the external world. (The attributes are: Staff on Demand, Community and Crowd, Algorithms, Leveraged Assets, and Engagement.)
The second group, IDEAS, contains the attributes needed to manage and control the external abundance within the organization. (The attributes are: Interfaces, Dashboards, Experimentation, Autonomy, and Social Technologies.)
In its 10 years of existence, the ExO model has spread worldwide. Today, OpenExO is a vibrant ecosystem with a tokenized economy and serves as a platform connecting 40,000 entrepreneurs, innovators, consultants, and companies actively engaged to spread knowledge and promote exponential growth in organizations of all types.
** The ExO Canvas is the visual thinking tool that, during the 10-week ExO Sprint program, helps teams implement the ExO Model to transform their business and achieve exponential growth.