A typical golden circle is a form of 3 concentric circles. It shows an analogy of the process by which things are done in life. Ranging from our usual activities down to technical activities.
These circles with WHAT at the innermost, followed by the circle of HOW and outermost is the circle of WHY.
WHAT: What, explains what you do as an organization or company.
HOW: This gives the description of your method to achieving your WHAT.
WHY: This entails the reason, the drive for your doing.
Taking an example to explain this gives a clear light of it.
Imagine 2 different companies producing an MP3 player electronic. Company A gives their advert caption as “5GB MP3 Player”. While company B gives theirs as “5,000 songs in your pocket.” As a buyer, which of the adverts will attract you more? Of course company B’s. This is simply because they did not follow the normal convention of communication of starting with WHAT. Company B gave a caption that stated to the buyer WHY he should buy from them and not WHAT he should buy from them.
Many companies have defined themselves with what they do and this has affected them in trying to go into other types of business. For instance, Dell once tried to sell MP3 players but did not survive long in the market because they have been known for computer production normally.
So, the bottom line is that, in anything you do as a leader, ensure you give your followers the WHY they need to continue. It is the WHY that will drive them longer to their aim than WHAT.