Remember back in 2014 when CVS made the decision to stop selling tobacco in their stores? CEO Larry Merlo was willing to leave billions of dollars in revenue on the table because the sale of tobacco products was inconsistent with the company’s purpose of helping people on their path to better health.
Today we hear so much talk about purpose, and we genuinely admire companies such as CVS that have the integrity to live up to their commitments. But having a clear, authentic business purpose is about more than simply having “corporate social responsibility”.
A generic vision statement or a catchy marketing slogan can easily become a forced “purpose” that does more harm than good. Neither is genuine, and people see through them. On the other end of the spectrum, if your business “purpose” is to generate profit, increase shareholder wealth, or simply sell products or services – aiming there as the “purpose” of your business is to shoot terribly low.
Yet, when organizations are grinding under the pressure of expected quarterly – even monthly – growth goals, it’s easy to lose focus on something that feels as aspirational as “purpose”.
But “purpose” has more value than many organizations truly realize or leverage. If you can clearly understand and define your organizational purpose, the downstream benefits go beyond a simple “warm and fuzzy” feeling to impacting many aspects of your business’ health including:
Ability to More Effectively Attract And Retain Talent
Purpose resonates strongly with people, and research shows that millennials prefer working for companies that are committed to bigger causes. A recent survey of 3,464 U.S. Millennials revealed they want to make a positive difference in the world (68%) and said a successful business needs to have a genuine purpose (81%) and the values of their employer should match their own (78%). And they’re willing to make compromises in order to achieve that. Over one-third said they would lower their expectations around having responsibility at work (35%) and career advancement goals (30%). To put that in perspective, 19% of U.S. Gen Xers felt the same way.
Most people know what an organization does, but few know why they do it. In other words, most purpose-driven leaders can articulate their mission–but many mission-driven leaders cannot articulate their purpose. As a result, our culture is inundated by leaders who do not approach strategy from a place of purpose. Leaders not connected to the reasons behind what they’re trying to accomplish are more likely to get distracted by novel trends, to give up when the going gets tough, to be viewed as opportunistic by customers and employees, and to avoid taking risks that can lead to innovation.
Ability to Have A Stronger Framework For Business Decisions And Functions
Purpose is certainly not just a marketing issue or positioning of your brand image. “Purpose” should impact every aspect of your company. By clarifying the purpose, leaders can emphasize and bring focus to every conversation, every decision, every problem their team faces, always asking, “Does this align with our purpose?” Your purpose sinks into the collective conscience. The culture changes and the organization begins to perform at a higher level. Processes become simpler and easier to execute and sustain. People start looking for permanent solutions rather than stop-gap measures that create more inefficiencies through process variations.
So, what does “purpose” mean for your business? Can you discover a purpose greater than simply creating a customer or increasing shareholder value? Can you create a business, a culture, built to communicate that bigger purpose? What might change if you did? What organizations could you model your working on purpose business upon? How can you draw people to commit and connect to your bigger purpose?
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