Why, How, What - Simon Sinek's Golden Circle model

Introduction

Many startup entrepreneurs turn to Simon Sinek's Golden Circle theory when they start creating their business plan. According to this theory, you should start by explaining the why question of your organization: Why, How, What, but start with why.

What is the Why, How, What model (Golden Circle)?

The Why, How, What model, also known as the Golden Circle, is a model developed by Simon Sinek to help you create a business strategy. The model is based on three concentric circles: the inner circle represents "Why," the middle circle represents "How" and the outer circle represents "What."

The model suggests that companies that focus on why they do something (what they believe in and stand for), rather than just what they do (their products or services), have more impact on their customers and stakeholder. Simon Sinek's Why, How, What model indicates that by starting with why, a company can make an emotional connection with its target audience and thus build a loyal fan base.

Be sure to watch the video where Simon Sinek himself explains his Why, How, What model (Golden Circle):

Three steps from Simon Sinek's Golden Circle

The Why, How, What model begins a company by defining their "Why" (why they exist), and then uses the "How" (how they intend to fulfill their mission) and "What" (what they do) to define their strategy and communications.

Why (why)

The Why in Simon's Golden Circle represents the purpose that drives an organization. This is about why an organization does what it does, what is the reason or motivation behind its activities. This is about the larger purpose and reason for the organization's existence. Sinek emphasizes that profit is never a good why, but should always be the result.

How

The next step is the How. This refers to what is the way an organization accomplishes its goals. This involves the strategies, processes and methods the organization uses to achieve its goals. You tell how your company is distinctive from the competition. So now you are communicating your proposition and your USPs.

What (what)

The last part of the Golden Circle: the What. Here you answer the question of what exactly you are selling, what are your products or services. This is what the organization does or makes, the concrete results it achieves.

Start with why

According to Sinek, it is important to start by answering the question "why" (why) rather than starting with "what" (what). He believes that organizations that focus on their why attract a stronger and more engaged audience than those that focus on their what. The Why, How, What model helps organizations focus on their goals and communicate their message in a meaningful way.

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Benefits of the Why, How, What model (Golden Circle)

• Helps define a clear mission statement:
  By focusing on the "why" of the business, companies can formulate a clear mission statement that is meaningful and motivates employees to achieve it.
• Creates customer loyalty:
  By communicating why the company exists and what it is trying to accomplish, customers can feel emotionally connected to the company and become more loyal.
• Distinctiveness:
  The Golden Circle helps companies stand out from their competitors by focusing on their unique why and how.
• Better decision-making:
  By focusing on the "why" of the business, the company can make better decisions that align with their mission and goals.
• More motivated employees:
  By communicating why the company exists and what it is trying to achieve, employees can better identify with the company's mission and goals, making them more motivated to contribute to the company's success.

Disadvantages of the Why, How, What model (Golden Circle)

• Not applicable to every business:
  One of the most important is that the model may be too simplistic and not applicable to all types of businesses and situations. Some companies may not have a clear "why" and it can be difficult to find or articulate.
• Sometimes too focused on emotion:
  The Golden Circle can sometimes be too focused on emotion and not enough on facts and figures.
• Too much emphasis on the Why
  Focusing on a company's "why" can sometimes distract attention from other important aspects, such as product or service quality, price or competitiveness.
• No proof
  It has never been proven that companies that start with why actually perform better than those that do not. The theory leans on anecdotal evidence and hindsight wisdom. Apple is every management book writer's standard way of proving that its theory is plausible, but that's not science. Also read this blog by Richard Engelfriet about it.

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Examples

Let's fill in the Golden Circle for Facebook:

• Why: At Facebook, we believe the world should be connected and technology should bring people together.
• How: We build tools that enable people to communicate and share information in new and innovative ways.
• What: We provide a social networking platform where people can share their thoughts, photos and videos with friends and family around the world.

To give you another example, we also fill in the Why, How, What model for Adidas.

• Why: At Adidas, we believe in the power of sport to change lives. We want to inspire people to push their own limits and reach their full potential.
• How: We create innovative sporting goods and apparel that help athletes improve their performance and achieve their goals. We work with athletes and coaches to continue to improve and innovate our product.
• What: We sell high-quality sporting goods and apparel, from sneakers to sportswear and accessories.

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