Forbes.com

The Power of Corporate Stories

How—and why—telling stories remains critical to shaping and strengthening corporate culture.

By David Michels

First published on agosto 07, 2023
min read


This article originally appeared on Forbes.com. My love for international business started with a baby cow. It was the spring of 1996 in rural Gujarat, India. As a young consultant, I was part of a team developing a business plan for satellite television in the country of nearly a billion people, most of whom had access to only a few channels. Since more than 70% of India’s population was rural, part of our research included focus groups well outside the major metropolitan areas. After one such session, the chief of a nearby Gujarati village invited us for a visit. To me, it was like traveling to a simpler world of dirt roads, humble dwellings, and free-roaming animals, where everything somehow felt more earthy, vivid, and real. As the only non-Indian on the team, I became somewhat of a novelty, if not a semi-celebrity. The locals’ hospitality was genuine and remarkable. Invitations for tea were constant, and their questions at the same time both curious and entertaining. One household was particularly interested in understanding what caste I was from! At the end of it all, I had to figure out how to respectfully decline their very generous gift of a baby cow. I had always had a natural curiosity about other cultures, but this experience tapped a host of emotions—empathy, gratitude, wonder, adventure, and curiosity among them—that cemented a conviction that if I were to pursue a career in business, I wanted it to be global. Over the years I’ve told my India story many times as a way to inspire people to think more globally about their career opportunities. People love stories. They’re what sell books, movies, even the news. Stories improve our ability to understand others and allow us to explore the world from a different perspective. In my experience, when someone tells you a good story, three things usually happen: You pay attention, you remember it, and you tell it to others. Good storytelling can be a powerful instrument in the business world, and particularly valuable in supporting change. In today’s world of continuous and accelerating change, stories make it easier for people to understand complex topics. They orient us and build our understanding and sense of security, combining facts and figures into something that makes sense. They can touch us emotionally and give us the energy and motivation to change. As Kelly McGonigal explains in her book The Neuroscience of Change, hearing a story activates more parts of the brain than viewing slides with bullet points full of data can. By stimulating what is known to be the “mirror neuron” system, stories make the listener feel as if they are in the shoes of the people in the story and experiencing the same sensations and emotions. Research has demonstrated, for example, that if we hear about someone kicking a ball, our motor cortex is activated. Talk about coffee and perfume signals the olfactory cortex. Even reading about dialogue engages the auditory part of our brain. Like people, organizations have stories. These stories create and sustain their culture. They are the roots that provide the anchor and life force that make it possible for new branches of the business to grow. They remind people what is important, connecting them back to the company’s mission and sense of purpose. The CEO of a global pharmaceutical company is using stories to explain a series of changes the company is undergoing to become more patient-centric. A physician by training, he still does monthly rounds in the hospital, and brings back very human stories about the people who use the company’s products. These stories both inspire employees and provide a simple yet profound context for the changes being enacted. Every pharma company talks about becoming more customer-centric, but it is actually quite hard to do. Perhaps you’ve heard the inspirational story of the Hewlett Packard garage, the birthplace of Silicon Valley innovation. Or maybe you’ve read the powerful story of the invention of the electric rice cooker at Toshiba in 1955. It’s both an illustration of Japanese ingenuity and entrepreneurialism in the postwar reconstruction period and a signal of the country’s future as a nation of great manufacturers. Japan is especially fertile ground for understanding the importance of company stories that connect the past, present, and future, with by far the highest number of companies in the world that are over 100 years old—reportedly more than 37,000. Telling a good story is a skill—one that can be studied, practiced, and improved. A well-told story usually has a few building blocks: Place—the physical, temporal, and cultural context that brings it to life Character—the people involved, the more richly painted and relatable the better Emotions—the feelings, actions, and energy of the characters Senses—things that activate the emotional network in our brains Detail—the color that enriches the central story and glues it together Good stories also follow a narrative arc: Situation—the background and circumstances that form the context Tension—the problem or dilemma that propels the story forward Choice—the moment of truth when a decision is made Answer—how that choice leads towards closure Resolution—the conclusion that shows how the characters have changed It’s painful to see new executives insert themselves into corporate transformations without a proper sense of the story—the history and context. It is as if they were telling the 25-year veteran of the company that everything they have done so far in their career was either wrong or not important. As the late historian J. Rufus Fears once said, one of the unfortunate lessons of history is that we don’t learn from history. In our world of data, algorithms, and artificial intelligence, storytelling remains essential. Through it we identify and communicate distinctly human truths and process information and events that can otherwise threaten to overwhelm us. This power of stories is not just for the entertainment industry and everyday consumer—it is also for business. Leaders who promise change and tout the benefits of healthy corporate culture should take heed. How do you tell your story?

This article originally appeared on Forbes.com.

My love for international business started with a baby cow. It was the spring of 1996 in rural Gujarat, India. As a young consultant, I was part of a team developing a business plan for satellite television in the country of nearly a billion people, most of whom had access to only a few channels.

Since more than 70% of India’s population was rural, part of our research included focus groups well outside the major metropolitan areas. After one such session, the chief of a nearby Gujarati village invited us for a visit. To me, it was like traveling to a simpler world of dirt roads, humble dwellings, and free-roaming animals, where everything somehow felt more earthy, vivid, and real.

As the only non-Indian on the team, I became somewhat of a novelty, if not a semi-celebrity. The locals’ hospitality was genuine and remarkable. Invitations for tea were constant, and their questions at the same time both curious and entertaining. One household was particularly interested in understanding what caste I was from! At the end of it all, I had to figure out how to respectfully decline their very generous gift of a baby cow.

I had always had a natural curiosity about other cultures, but this experience tapped a host of emotions—empathy, gratitude, wonder, adventure, and curiosity among them—that cemented a conviction that if I were to pursue a career in business, I wanted it to be global. Over the years I’ve told my India story many times as a way to inspire people to think more globally about their career opportunities.

People love stories. They’re what sell books, movies, even the news. Stories improve our ability to understand others and allow us to explore the world from a different perspective. In my experience, when someone tells you a good story, three things usually happen: You pay attention, you remember it, and you tell it to others.

Good storytelling can be a powerful instrument in the business world, and particularly valuable in supporting change. In today’s world of continuous and accelerating change, stories make it easier for people to understand complex topics. They orient us and build our understanding and sense of security, combining facts and figures into something that makes sense. They can touch us emotionally and give us the energy and motivation to change.

As Kelly McGonigal explains in her book The Neuroscience of Change, hearing a story activates more parts of the brain than viewing slides with bullet points full of data can. By stimulating what is known to be the “mirror neuron” system, stories make the listener feel as if they are in the shoes of the people in the story and experiencing the same sensations and emotions. Research has demonstrated, for example, that if we hear about someone kicking a ball, our motor cortex is activated. Talk about coffee and perfume signals the olfactory cortex. Even reading about dialogue engages the auditory part of our brain.

Like people, organizations have stories. These stories create and sustain their culture. They are the roots that provide the anchor and life force that make it possible for new branches of the business to grow. They remind people what is important, connecting them back to the company’s mission and sense of purpose.

The CEO of a global pharmaceutical company is using stories to explain a series of changes the company is undergoing to become more patient-centric. A physician by training, he still does monthly rounds in the hospital, and brings back very human stories about the people who use the company’s products. These stories both inspire employees and provide a simple yet profound context for the changes being enacted. Every pharma company talks about becoming more customer-centric, but it is actually quite hard to do.

Perhaps you’ve heard the inspirational story of the Hewlett Packard garage, the birthplace of Silicon Valley innovation. Or maybe you’ve read the powerful story of the invention of the electric rice cooker at Toshiba in 1955. It’s both an illustration of Japanese ingenuity and entrepreneurialism in the postwar reconstruction period and a signal of the country’s future as a nation of great manufacturers. Japan is especially fertile ground for understanding the importance of company stories that connect the past, present, and future, with by far the highest number of companies in the world that are over 100 years old—reportedly more than 37,000.

Telling a good story is a skill—one that can be studied, practiced, and improved. A well-told story usually has a few building blocks:

Place—the physical, temporal, and cultural context that brings it to life
Character—the people involved, the more richly painted and relatable the better
Emotions—the feelings, actions, and energy of the characters
Senses—things that activate the emotional network in our brains
Detail—the color that enriches the central story and glues it together

Good stories also follow a narrative arc:

Situation—the background and circumstances that form the context
Tension—the problem or dilemma that propels the story forward
Choice—the moment of truth when a decision is made
Answer—how that choice leads towards closure
Resolution—the conclusion that shows how the characters have changed

It’s painful to see new executives insert themselves into corporate transformations without a proper sense of the story—the history and context. It is as if they were telling the 25-year veteran of the company that everything they have done so far in their career was either wrong or not important. As the late historian J. Rufus Fears once said, one of the unfortunate lessons of history is that we don’t learn from history.

In our world of data, algorithms, and artificial intelligence, storytelling remains essential. Through it we identify and communicate distinctly human truths and process information and events that can otherwise threaten to overwhelm us. This power of stories is not just for the entertainment industry and everyday consumer—it is also for business. Leaders who promise change and tout the benefits of healthy corporate culture should take heed. How do you tell your story?