What is the Golden Circle and Why Does it Matter?

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Have a unique business idea? Looking for better start-up opportunities and strategies? Then you might already be going through a brainstorming session to implement the “Golden Circle” in the best way possible!

Confused? Read on!

Before starting off and opening your company, ask yourself this question – “Why am I doing this? Do I have a specific purpose?” If you answered that successfully, then you are already beginning to understand the rules of the Golden Circle.

What is the Golden Circle?

You might have known by now that the Golden Circle refers to the technique that enables you to find your purpose – be it in your business or your personal career. It’s your purpose that defines who you are, your motivations, and your goals.

Having a strong sense of your purpose also makes you feel alive and allows you to find meaning in your endeavors. In fact, the Golden Circle is a way to help you offer your customers the best value and experience by changing how you think about your business.

The concept of the Golden Circle was introduced by Simon Sinek in 2009 in his TED talk, “How Great Leaders Inspire Action,” which received over 48 million views. In his discussion, Simon used the perfect example of Apple to explain how the Golden Circle works and how it can be successful for one’s business.

The Three Pillars of the Golden Circle

Every single organization on this earth functions on three main levels –

  1. What we do
  2. How we do
  3. Why we do

Simon used the above figure to explain the three levels of the Golden Circle. He said that most businesses would tend to think outside-in from “What” we do to “How” and “Why” we do it. However, inspired leaders would rather think the other way round – going from “Why” to “How” and then to “What”!

Let’s take Simon’s example of Apple. Why do you think the technology company is so popular? Is it because Apple develops top-notch, outside-the-box technological innovations? Or is it something else? The answer is “both” in some way.

The fact is, consumers across the globe can literally trust Apple blindly. The brand has developed a great reputation for itself, so much so that nobody even thinks about trust or quality issues with Apple.

However, it is not always the cool and advanced devices and technologies that buyers look for. Rather, they buy the company’s experiences and problem-solving solutions. And this is possible only because Apple has successfully inspired them with their strong purpose and beliefs associated with the brand.

To answer the question, “Why are you doing what you do?” let’s say, it’s your inner fire and strength that acts as the driving force for all your actions. Your actions cannot simply be purposeless; there should be a particular inspiration or motivation behind what you do.

Simon says that many people define themselves by “What” they do. But the ideal process should start from the Why of things – Why they do? >> How do they accomplish it? >> What do they do to meet their goals and missions?

The WHY and HOW of Your Life

“Why” is the inspiration that motivates you to think about your short and long term goals. It gives you a clear direction in life and enables you to identify your mission and vision. After you are aware of your purpose, you move on to the next stage – “How to do it?”

Now, decide on “How” to go about accomplishing your goals and missions. The answer to this “How” is defined by your personal success path and the choices you make in life. Sometimes through trial and error and experiences of the past, you decide what processes would work best for you to reach your goals.

It’s like a treasure hunt where you search for the key to a certain doorway or treasure. The more focused you are towards your goals, the better your chances to choose the right path to find that key. Your motives and inspiration play a huge role here and enable you to unleash the best of yourself.

WHAT are Your Actions?

After you have found your “Why” and “How” of things, it’s time you shift to the “What,” which is like the vehicle that helps you realize your potential and hidden talents. Whatever you do or wherever you go, you can always live and relive the “Why” and “How” of your life.

However, the trick is to find the right “What” as far as possible. Your consistency and focus will guide you towards choosing the right “What.”

How to Implement the Golden Circle in Your Business?

To understand the importance of the Golden Circle in your business, let’s go back to Apple’s strategies.

  • Apple’s “Why”: We believe in “thinking differently” and “challenging the status quo” in everything we do.
  • Apple’s “How”: Our products are designed beautifully and are quite simple to use.
  • Apple’s “What”: “We just happen to sell computers.”

This is where Apple’s success lies, and it can work for your business as well.

Many businesses think outside-in of the Golden Circle by defining “What” they do, based on which they figure out “How” to do it. Finally, they tell their customers “Why” they did it. We are not saying that starting with the “What” of things will hurt your business.

However, if you start with your purpose and the reason – “Why” – you can build a strong relationship with your target audience and motivate them to believe what you believe. Thinking inside-out of the Golden Circle can enable you to create a personal and emotional connection with your people. This alone gives the much-needed jumpstart for your business, and helps to keep yourself motivated throughout.

People won’t buy from Apple because of their products; they do so because the tech manufacturer has a clear vision and purpose, strong enough to inspire the world. They have created a life-long value for their consumers.

Final Words

Don’t be like many other organizations, who are out there with the sole purpose of making money. A business without a “purpose” and “inspiration” won’t survive for long. Instead, identify your purpose and mission – Why do you want to do it? Do you have a story to tell that can inspire the world?

Did you learn anything specific from your life and past experiences that changed the way you think or define who you are today? Is there a particular motivation and belief behind your business idea?

Convey your thoughts and your organizational purpose to your audience before explaining the “How” and “What.” You will be surprised to see the amount of engagement among your customers and how you inspire them.

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