How Leaders Turn Purpose Into Daily Behavior

Purpose only matters when it shows up in decisions, incentives, and the everyday behavior of leaders and teams. With Dr. Peter Fasolo—Professor of the Practice and Director of the Human Resources Policy Institute at Boston University Questrom School of Business, and former CHRO of Johnson & Johnson—we dig into how to build a culture that lasts: one where values guide trade-offs, managers teach with time and perspective, and employees trust the why behind hard calls.

We explore what separates solid managers from transformative leaders, and why both roles are essential to carry strategy the last mile. Peter explains how transparency strengthens credibility even when consensus is impossible, and how leaders can close the say-do gap by aligning selection, rewards, and operating rhythms with a clear mission. As AI accelerates productivity, he argues the human edge—context, empathy, mentorship, sponsorship—becomes non-negotiable. Advisory tools can nudge, but they cannot replace nuance or care.

The conversation moves from incremental efficiency to bold redesign. Instead of treating organizations as stacked boxes, we look at work as cross-functional flow. AI can help map friction and remove waste, while leaders reimagine processes to make jobs richer and more collaborative. We also address mental health and well-being as a true test of purpose: democratizing access to support, equipping managers to notice strain, and building climates where people can bring their whole selves and still grow.

We close with a practical playbook: hire for values and collaboration before competencies, reward purpose-aligned behavior, teach leaders to explain the why, and use AI to remove bureaucracy without losing humanity.

Chapters

• 0:45 Setting The Stage: Purpose In Business
• 1:50 Meet Dr. Peter Fasolo
• 2:49 Why Purpose Must Be Lived
• 5:08 Designing Culture As A System
• 7:49 Managers Versus Leaders In Practice
• 10:43 Transparency And Employee Expectations
• 15:31 AI, Trust, And Human Leadership
• 19:25 Beyond Productivity: Reimagining Workflows
• 27:57 Well-Being From Policy To Practice
• 32:59 Concrete Steps For Purpose-Led Cultures
• 36:54 Gratitude And Closing

Transcript

J.P. Matychak: 0:25

Welcome back to another episode of the Insights and Question Podcast, the podcast where scholars, leaders, and innovators come together to explore the ideas shaping the future of business. I'm your host, JP Matychak, here with my co-host, Drew Vaughan. And today, we're diving into one of the defining topics in modern business leadership: building purpose-driven organizations. Companies of every size are talking about purpose, why they exist, what they stand for, and how they create value for their people and society. But purpose can't just be a slogan on a website. To actually matter, it has to live in the culture, the decisions, and the everyday behavior of leaders and teams. So, how do leaders cultivate that? How do they build a shared mission that people don't just understand but truly believe in? To help us unpack that, we are thrilled to welcome a leader who has lived this work at the highest levels of global business. Our guest today is Dr. Peter Fasolo, professor of the practice and the director of the Human Resources Policy Institute here at Boston University Questrom School of Business. Before coming to academia, Peter spent nearly two decades as the executive vice president and chief human resources officer at Johnson ⁇ Johnson, where he helped lead one of the world's most mission-driven companies, guided by a Credo that has shaped their culture for more than 80 years. He's worked with CEOs, boards, and leaders around the world to build cultures rooted in trust, ethics, and purpose. And now at Questrom, he's helping the next generation of leaders understand not just the strategy behind people leadership, but the humanity behind it. Peter, welcome to the Insights at Questrom podcast.

Peter Fasolo: 2:19

JP, Drew, thank you for having me.

J.P. Matychak: 2:22

So let's just dive right into this. You know, in the in your past, you've spoken a lot about the importance of purpose-driven leadership. How can leaders ensure their organization's mission truly aligns with the personal purpose of their employees beyond just the words that you might see on a wall?

Peter Fasolo: 2:43

Well, I think that's a great place to start, JP, because really, stepping back, you want to ask yourself how do you build companies that are built to last? How do you ensure that your thousands of employees and decision makers are making decisions aligned with your purpose, they're right, they're ethical, and how do you ensure trade-offs are made correctly between investors, employees, suppliers, and customers? There's really only one answer. You need a why, a purpose, or a North Star. But that's not enough. You must work that every single day. You have to role model it, you have to select for it, you have you have to make sure your people agenda is built around it, and you have to reward for it. So purpose-driven companies, we know the research is very clear. Perform better, they retain their leaders and their employees better, they handle crises better. And I was fortunate, as you said, to be part of one of those purpose-driven corporations at Johnson & Johnson. A company that's truly built to last based on a Credo that was written by its founder over 80 years ago in a company that's almost 140 years old. So you can do it, but it's more than just a slogan on a wall. You have to remind yourself who do you serve, what are the ways to win, what are the best ways to execute, and how do you do it in a way that's aligned with your why or your North Star? But it has to be working.

J.P. Matychak: 4:35

So a lot of companies treat culture like a campaign. You know, we're gonna we're gonna launch this new culture initiative, and uh, you know, and and you you start to see like the things we've talked about, like the the words up on the wall, a new motto, a new slogan. So, what does it look like to deliberately design culture from the top down? You know, starting with the board and the C-suite and carrying that through all the way through your everyday practices and the work that you do.

Peter Fasolo: 5:05

Well, I think you have to think about culture in a in a system. It's a corporations are systems of purpose, as you suggest, the why and strategies, the what, and operating priorities are how you get it done and you measure it. Um, but you have to look at your ways of working through the lens of your of your values. And you know, cultures are behavioral rhythms, they're behavioral regularities. Uh they show up in ways that are manifested by the leaders you select, the climate or the way you design your organization, the norms and ways of working, from business processes to your people practices. And essentially, it's about answering the question: how do we do things around here? If we say that one of our values is to care for one another and collaborate, but you're more of a top-down individual-based system, then there's daylight between what you say and what you and what you do. So leaders have to really think about how they create a climate and select people that are consistent. It starts in the boardroom, it starts with your CEO and your executive team, they cast enormous shadows in the organization. Uh, people will see the say due gap pretty quickly. And eventually, what employees really interpret is how do you get things done around here? It's the conversations they have in the cafeteria, it's what they're watching, it's the artifacts, but most importantly, it's the leaders and the managers who have to pull through the intent and the purpose as articulated in a corporation uh day in and day out. No one speech or CEO from a town hall or a head of HR from a platform is going to change that. It's the day-to-day behaviors of your units that are actually going to make this come to.

Drew Vaughan: 7:21

Hmm. And I think you make a really good point there in building upon that, how do we do things here and your experience at Johnson Johnson? What have you found separates managers who simply execute policy from those who truly engage and inspire their teams on a daily basis?

Peter Fasolo: 7:39

Well, it's a good distinction, Drew. And I think organizations need both leaders and managers in their system to make the flywheel work. Each play a very, very critical role. You have frontline associates that play a critical role, primarily with the customer interface, or in our case, the patient. Managers are there to plan, to organize, to implement, to measure, to make sure that strategies are pulled through. And the leaders, who presumably, one could argue, are at the top of the organization, but my experience is that leaders are found throughout organizations, up and down the ranks. They have a well-articulated strategy. They understand that their role is to make trade-offs. You know, many companies are littered with great strategies that go unexecuted because people either fail or choose not to make the trade-offs that strategy requires: trade-offs of people, trade-offs of resources, financial and otherwise. Leaders have to engage and probably more importantly, Drew, they have to teach. By the time you get into a leadership position, it's less about doing. It's more about providing what I think are the two greatest gifts that a leader can provide: his or her time and his or her perspective. A leader doesn't have a marketplace on what the right answer is, but their job is to solicit input around them to ensure they have teams that are, quite frankly, better than who they are individually, diverse backgrounds and experiences, and that they have to give their time to listen and to solicit. And as importantly, they have to provide their perspective because they may see an angle on a problem from a different chair from where they sit. So managers play a critical role, leaders play a critical role, and predominantly the leader has to ensure that they are creating an environment of care, of trust. And only when there's care and trust can you continue to raise the bar. Part of leadership's uh responsibility is to push, to make everyone better, to get 10 to 15 percent more out of everything. But you can't do that unless there's care and trust. Because if you try to do that without care and trust, you'll look behind you and no one will be there.

Drew Vaughan: 10:24

And I think you make such great points about the many important hats that leaders juggle, especially now with several generations entering the workforce and fully in the workforce. How do you see these leaders balancing differing expectations, especially as Gen Z is demanding transparency, flexibility, and a clear social purpose?

Peter Fasolo: 10:46

I think, you know, starting with your last point about social purpose, I do think uh more and more people coming into the workforce today are selecting uh firms and corporations based on their uh place in the world and their uh their fingerprints uh on the world stage from climate change to uh being uh a place in the world where you're doing good and where they can see their personal mission aligning with the corporate mission. And I think that's really, really good. And I don't I don't think that's a generational issue per se, but it's one that's clearly on the minds of Gen Z and others coming into the workforce uh today. You're right to point out that more and more employees are um demanding or expecting greater transparency, and I think that's I think that's really healthy. There are you know constant changes in employee expectations and rising employee expectations on understanding the why behind the decisions that uh leaders make. That doesn't necessarily mean that there's going to be agreement or 100% alignment or consensus up and down the ranks, but I think it's healthy when employees expect their leaders to share the why behind the decisions. And that may be as simple as a CEO or a C-suite executive articulating the dilemma that they're trying to work their way through on a set of issues that require trade-offs. And so I often try to encourage CEOs or PO leaders that I work with that understand that your employees are an incredibly important stakeholder group, in addition to customers and investors and the communities in which you serve, because they are going to help amplify the brand with those stakeholders. So just don't inform them of your decision, but help them understand, in some cases, the dilemmas, the trade-offs, and how you are working your way through that on stage or in private meetings, and it goes a long way to demonstrate your authenticity and your personification of your leadership in real ways to your employees. Again, I'm never uh expecting full alignment or 100% consensus. What we should expect is greater transparency up and down the ranks of your organization.

J.P. Matychak: 13:38

You know, I'm often reminded of uh some previous leadership training uh in my past. And and one of the things that we we always talked about was sharing your thoughts, feelings, rationale and your uh in your decision making, uh, because it is, as you said, it's the people in the employees that are every day going to be even closer to the customer than you are. And the more they understand why something is happening or why a decision is made or why a product was uh taken off the market or whatever the the decision may be, um the better advocates they can be uh and better, as you said, amplification of the brand uh can happen out in to out into the uh the marketplace. So um it's it's an important piece of this. Uh let me share now.

Peter Fasolo: 14:31

Uh yeah, go ahead. I'm I'm sorry, but just on that point, I think even more so today, where all indicators suggest, and you can look at the Edelman indices and others, point to the need for greater trust in the world. Corporations and C-suite executives are are at a um at a higher expectation of their employees to try to create this this trust and this transparency, and more and more employees are turning to the C-suite to provide that kind of predictability when they can't find it in other places.

J.P. Matychak: 15:10

Exactly right. Exactly right. So I let me shift a little bit now. It is hard not to talk about anything in the world today without saying AI. So I'd like to shift a little bit, if we could, to AI. And you know, as as uh artificial intelligence becomes uh uh more embedded in the work that we do, how should leaders think about uh maintaining this notion of trust and and empathy and a sense of shared mission, really, amid this uh growing automation and and uncertainty that's that's happening with uh the proliferation of of AI?

Peter Fasolo: 15:53

I think it puts even a greater premium, JP, on the um on the skills that managers and leaders need to uh evidence uh day in and day out. I think uh I think there is tremendous optimism and real um uh real hope for what AI can continue to unleash in organizations. Uh you see it in healthcare, you see it in education, you see it certainly in the technology arena and retail. And I think there is a tremendous amount of opportunities that will be unleashed by AI and machine learning and large language models. We see it in blockchain and supply chain. So, with all of that coursing through these companies and firms, what is required now of managers is context, problem solving, um, the ability to empathize, to care for. Right now, in my view, AI is being uh manifesting itself primarily in the area of productivity. AI is being applied to existing business processes, and it's finding uh great ways to find efficiencies and financial planning and analysis and customer service or other kinds of analyses and pricing models, etc. And I think that's really, really terrific. As it continues to migrate up into, let's call it more managerial tasks, such as performance and objectives, coaching, uh, recruiting, and things of that nature on the people side, it will require managers now to demonstrate as their spans of control perhaps get wider and perhaps the de-layering of corporations uh continues to occur. You will need managers who are extraordinarily gifted at working with people to demonstrate, as I mentioned before, the care, the empathy, the problem solving, the context that is necessary to create and maintain the power of the culture of connectivity, of mentorship, of sponsorship. These things were always important. Now they are non-negotiables. Because one perhaps could have gotten away with being an average manager and um and being to maybe the left of the curve. But as AI is pushing more and more efficiencies in the system, employees will look towards the human element of this problem solving to mirror up with AI to ensure that cultures are actually maintained, that they are nurtured, and the only way to do that is human-to-human interaction, not AI.

J.P. Matychak: 19:05

It's interesting. Um I was just at an event yesterday, and uh a woman who was on the panel uh is a faculty member at Northeastern University and uh works with boards and board uh board governance and spoke to the fact that she is currently working with one board who is experimenting with an AI director. So this they have trained this AI through uh to take on the persona of several different uh people, um, one of which being Mark Zuckerberg, um uh and then uh Warren Buffett as another one. Um, and I I can't remember who the the third persona was, but using these personas, um having this AI bot, if you will, be on the board of directors, they don't have a vote, but they're keeping uh a watch on is there groupthink amongst the board, uh bringing in some uh more objective views. And to me, I just sat there in the audience of like, oh my goodness, like where where is this gonna go? And you talked about this this notion of right now it's used for productivity, but as it moves up the ladder, it could really um really transform how we look at businesses as operating.

Peter Fasolo: 20:34

Yeah, I think I mean those are those are uh frightening examples that you are seeing in in in places from from boardrooms to the C-suite to I would say most of that technology now that's being used is more in the advisory capacity versus let's say coaching. Um, you see some of these uh augmented um uh tools, these agents. They are good from an efficiency standpoint. They provide perhaps good advice on how to engage more or to bring people in or to give you some feedback on how you can be more effective in a group setting. What they don't do is they can't provide context, nuance, empathy, understanding. Will they be able to do that over time? I mean, that's anyone's guess. But it it it to me will put even more of a requirement on managers and leaders to stay so connected with the needs and the desires and the motivations of their employees. Uh, because as these AI tools become more and more prevalent through organizations and firms, people will not stay in a world where there's just a transactional relationship with uh with a technology connection, or quite frankly, even with leadership. They will stay with companies that have an investment model, that they invest in them, they invest in their skills, they invest in their professional development. If they stay there or not is a separate topic. But what really great companies that build unbelievable cultures where there is a care and an empathy, there is a consistency of a view of investment behind you, that we will invest in your professional development and help you stay competitive if you are with us or not. And that to me is a caring leadership model. It's a servant leadership model. And I think that puts even more of a premium on really what we're talking about here today on this podcast, which is purpose, leadership, and culture are all interconnected, they all play off each other, and you can't have one without the other. You can't have a well-articulated purpose, but then not pull it through with the right leaders. You can't have a well-articulated purpose and not have a people system that reinforces and uh enhances the culture so that people understand that there's a real manifestation of the why behind your company. They all have to work off each other.

Drew Vaughan: 23:39

And I want to stay on this artificial intelligence wave for just another second here. Um, and just I know you've really talked about some of the opportunities and efficiencies that come with AI, and you also touched upon some of the fear surrounded by artificial intelligence today. Um, in what ways can technology really be leveraged to empower rather than displace employees and really help organizations reimagine work and reduce bureaucracy?

Peter Fasolo: 24:09

Well, I think Drew, right now, as we sit here today, most of the AI tools and agents are being used as uh more or less a productivity play. They're looking at existing work processes and finding ways to look for efficiencies and take steps out and to be more efficient in the way they work. I think that is a necessary but not sufficient condition. Where AI will have to take companies next in the next journey is more around reimagining the way work is being done, asking some very fundamental questions. Why does the work process even exist to begin with? Why do we have all of these layers of checks and balances? Can things be done more imaginatively? That to me is less about AI, and it's more about some of the basic elements of work redesign, workflow, interfacing with not just the people practices of a corporation, but systems engineering, um, ways of working, technology. So rather than thinking as an organization or a firm as a set of organizational charts that have job descriptions and domain knowledge in the box, companies will have to continue to think about workflow that goes across the organization. So work generally flows in between boxes, between manufacturing and supply chain and RD and the commercial aspect. So more and more companies will have to start reimagining workflow and think of their organizational structures not as boxes and domain knowledge, but as workflow in a cross-collaborative manner that now has organizational charts that go more across than they do box by box and down. And to me, that's where the exciting part of the use of AI and agents really, really come to life. Work can become more meaningful, it can become more integrated. People, rather than having domain knowledge that's specifically deep, can have both deep and broad domain knowledge so that work can become more meaningful, more purposeful, and cultures can be unleashed to get more things done in a way that unlocks the potential and the imagination and the innovation of these organizations today. But it takes a different way of looking at workflow and not just applying it to be efficient.

Drew Vaughan: 27:09

I feel like lots of discussions right now, you see, news headlines are centered around the reluctance to accept artificial intelligence. So it is refreshing to hear a perspective just really diving into the opportunities within it and how to embrace it rather than run away from it because it is here today, as we all know. Shifting the conversation a bit now to talk a bit about some policies one might call parts from organizations. We see this in hybrid models to mental health support. How do you think purpose-driven companies turn well-being policies into real cultural commitments instead of just symbolic gestures?

Peter Fasolo: 27:51

Well, again, that's a great pivot to again a very, very important part of firms and corporations and social systems that we call companies in the care and the feeding of the associates that they have the privilege to serve. People just don't check themselves at the door when they come to work. They are individuals with lives and families and dilemmas and trade-offs and worries. And more and more today, probably as a result of the acceleration that we saw post-the pandemic, you're seeing even more loneliness, social isolation in the world in general, but certainly in companies today. So when I was at Johnson Johnson, we were seeing even more need for support services for our employees, and that continues today in most major corporations. People are needing a helping hand, they're needing a bit of an arm around them to navigate what's happening not just at work but in their lives. People will need continuous support for psychological services, EAP, mental health and well-being services. And this is where, again, AI can be very helpful, or the use of technology can better democratize the availability of resources on platforms. So one doesn't have to necessarily go from point A to point B to get these services, but can get these kinds of support services at home via Zoom, technology. They can access it for their loved ones. And to me, uh, the need for greater and greater services for employees to bring their best selves to work so that they can truly realize their potential requires employers to support them in new and very, very different ways. And one of the things that I would often think about and worry about as the head of HR at Johnson Johnson was what I was not seeing: the untapped potential, the worries that our employees were bringing to work, the issues that were taking place outside of work. And if you can have leaders and managers, getting back to our earlier conversation of being the stewards of their culture, if you can have managers and leaders who can create environments at a local and departmental level in a way that allows employees to share those things or to find resources to make available to them to navigate these issues, your cultures will be healthier, your employees will feel cared for, and as importantly, they will be able to unleash their growth mindset and their potential to solve problems. Because at the end of the day, firms and corporations and institutions are there to innovate. And you cannot innovate unless you have a growth mindset in a way that allows you to bring your whole self to work. And that means teams that are diverse, have various experiences, and the role of the leader and the manager is to create conditions by which these diverse experiences and backgrounds can actually produce results that are better than any one individual on his own or her own.

J.P. Matychak: 31:48

That's that's just such a just a salient point there around the the notion of leaders' roles being, you know, the leader's role being creating these environments, right? You I think you said it earlier, it as you become a leader, it's less about doing right and doing the work. It's more about uh you know guiding others and and bringing out the best of others and creating those environments. So let's uh let's close out our conversation today with uh some some concrete steps, you know, as as organizations are uh uh uh are navigating this this uh you know uh just changing world from AI disruptions to uh evolving employee expectations to uh multi-generational expectations in the workplace. What are say some of the first concrete steps leaders can take to build a resilient and purpose-led culture?

Peter Fasolo: 32:50

Well, I think that's a great way to summarize a bit of the conversation we've just been having, JP and Drew, regarding uh purpose and culture and leadership. I think organizations have to have a set of guiding principles, a way of thinking, and a way to um ensure that their cultures are not just statements, but that you have to actually work in practical ways to ensure that your cultures are vibrant and that they are manifesting in a way that is your from your stated purpose. It starts with selecting great people, making sure that your associates, your managers, your leaders are of the backgrounds and experiences and values consistent with the values and the purpose of the firm. Notice I've said nothing about skills or competencies. I've said everything about who you are as a person. What are your values? What are your traits? Do you value collaboration? Do you truly believe that the team is greater than the individual? Um understanding potential derailers where things can go wrong, what are you like under stress? And can you can you understand that your role in many respects is to be solution-oriented and not blame focused when things become difficult? And they always you always have difficulties at work, but you want people who have a range of skills or traits, rather, that make them effective people leaders or associates fitting in with your culture. And uh my experience has been that successful employees and executives and derailed employees and executives they look remarkably similar on the surface. They are both not perfect, uh, they're they may both be ambitious, but the ones that truly are able to continue to soar on and continue to help drive your culture, they're more solution-oriented, they generally have interpersonal capabilities that can span the boardroom to the mailroom. Uh, they care about each other, and they see their job as surrounding themselves with people with a diverse set of skill sets, and their job is to make sure that the whole is better than the individual. And I think that's more than just statements, but you actually have to work for it, select for it, and then have policies and practices that reinforce the kind of leaders and employees you bring into your firms. It starts and ends for me on people and who you put in boxes that are aligned with your culture. Because if you get the selection right, you will advance your culture. If you get it wrong, you will at the very least stall it, but many times you will go backwards. And that's not a place any firm or company needs to be or wants to be in order to stay competitive.

J.P. Matychak: 36:35

Peter, thank you so much for joining us today and for bringing such uh thoughtful perspective to what it really means to uh to lead with purpose, which I think is very uh appropriate uh with what you just sort of uh summarized with. And and everything you described there are purposeful decisions in who you select and and how you work together uh to bring out the best in your people, which ultimately should bring out the best for your company. So thank you so much for joining us.

Peter Fasolo: 37:11

JP and Drew, thank you for having me.

J.P. Matychak: 37:15

Well, that'll wrap things up for this episode of the Insights at Questrom podcast. I want to thank again our guest, Peter Fasolo, professor of the practice and director of the Human Resources Policy Institute at Boston University Questrom School of Business. To our listeners, thank you for spending time with us. If you enjoyed this conversation, please follow the podcast and share it with friends and colleagues. You can also explore more perspectives from Questrom faculty and thought leaders at insights.bu.edu, where we share research, analysis, and ideas shaping the future of business. On behalf of my co host Drew Vaughan and the entire Insights and Questrom team, thanks for joining us. So long.