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5 Things Leaders Could Learn from Better.com

Leaders can’t hide behind Zoom

When Better.com CEO Vishal Garg laid off more than 900 employees from his mortgage lending startup via Zoom, he didn’t just commit an error of execution. While the timing and process were certainly problematic, the fundamental error exposed in last week’s most socially shared corporate blunder was Garg’s inability to create a purposeful culture — from the roots up.

To be fair, Garg publicly apologized for his embarrassing behavior, but the damage was already done. Now the cracks in the company’s poor culture are growing into chasms. In the wake of the viral nature of the backlash, Better.com lost many of its senior leaders, leaving the wounded CEO to manage the crisis with an external crisis management firm. And it’s not getting better for the startup, as national media outlets continue to apply pressure, as its SPAC, originally scheduled to close this quarter, was SPANC’d.

So what steps could the CEO have taken to build a purpose-driven instead of a fear-driven culture? The purpose of his company, to disrupt a broken system to make homeownership simpler and more accessible for all Americans, is something to build on. It’s something that can influence people to bring their best each day. But that’s only part of the equation. Here are some suggestions.

5 Ingredients of a Purposeful Culture

Through our research and practice, we’ve found five key factors influencing work engagement, retention, emotional self-regulation, resilience, and mental health. Together, they relate to a Purposeful Culture – a culture that not only attenuates backlash when tough decisions need to be made, but also prevents those tough decisions from having to be made in the first place.

1. Dignity and Belonging

Do your employees feel valued by your organization? Do they feel like they belong? Are they respected by their managers? By their co-workers? Can they voice a contrary opinion in a meeting without fear of reprisal? In a recent Kumanu-Harris Poll we found that employees who felt dignity and belonging within their organization were nearly four times more likely to intend staying in their organization and over five times more likely to report being engaged in their work. Calling your team “a bunch of DUMB DOLPHINS” is probably not the path to dignity and belonging. By the way, if you think the focus on dignity and belonging is for wimps and wannabes, just ask any special forces group in the U.S. military.

2. Higher Purpose of the Organization

Does the purpose of your organization inspire the employees? Do they use the higher purpose to guide their daily decisions? When things get rough? Are outsiders (e.g., customers, suppliers, job applicants) drawn to the organization? Beyond the pretty words in a corporate purpose statement, do employees believe that the words are authentic? If so you’ll be more likely to have a workforce that indeed is a force.

3. Organizational Support for Meaningful Work

Employees have different reasons for working. Some work for the money. Others to help create a better world. In between, people work for personal growth, for their customers (think medical personnel), and for their team. How can you make purpose a cultural imperative? Start with your people. Personal purposes comprise two basic elements: 1- how you feel when you’re at your best; and 2- what matters most to you. Breaking purpose down into these steps provides you and your team with a common language to openly discuss how your employees want to show up for their teammates, family, and community. It also provides the groundwork to highlight the connections between personal purpose and organizational purpose.

4. Organizational Identification

When talking about the organization, do your employees use the word “we” or “they?” Do they view the organization’s successes as their successes? We all need to feel that we’re part of something larger than ourselves. When that happens, as Emile Durkheim said in 1897, “sentiments of solidarity as yet almost unknown will spring up and the present cold moral temperature of this occupational environment still so external to its members, would necessarily rise.”

5. Meaningful Work

Does our work help us fulfill our life purpose? Most of us spend the majority of our waking hours working. We work hard in school and in our early careers to get jobs that have meaning. However, as Mike Rowe from the Discovery Channel TV series Dirty Jobs has pointed out, meaning can be found in almost any job. The famous – and possibly true – story of John F. Kennedy asking a custodian at NASA what he did, and receiving the response, “Well Mr. President, I’m helping put a man on the moon!” is a perfect example of crafting meaningful work. Some leaders focus on how important they are and some leaders focus on how important each member of their team is. Leaders have choices in how they lead and those choices can become habits.

Purposeful Culture is a Habit

In his book Working, Studs Terkel wrote that, “Work is about the search, too, for daily meaning as well as for daily bread, for recognition as well as for cash, for astonishment rather than torpor; in short, for a sort of life rather than a Monday through Friday sort of dying.” Purposeful cultures don’t create themselves and they can’t persist without dedication from their leaders. Better.com never put the cultural work in, so no amount of “execution” would have prevented the pain their former employees are now facing. If a purposeful culture had been nurtured in the first place, if their leader wasn’t so scared that he felt he needed to lead with fear, then perhaps many of the decisions leading to the Better.com disaster could’ve been avoided. Sadly, we’ll never know, but what we can predict is that the roughly 900 employees who got fired will be better off than the employees still working at Better.com.

About the Author

professional headshot of vic strecher

Vic Strecher, PhD, MPH

CEO and Chief Purpose Officer, Kumanu

Vic Strecher is professor of Public Health, founder of the Center for Health Communications Research, and Director for Innovation and Social Entrepreneurship at the University of Michigan. In 2015, Vic launched Kumanu, leading a paradigm shift in how individuals engage in the pursuit of purpose, meaning, and wellbeing. As CEO and chief purpose officer, Vic leads the company as well as its world-class Scientific Advisory Board.

 

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