Those who know us won’t be surprised to hear this: these days, it simply isn’t enough for a business, any business, to think solely in terms of revenue, expenses and profit.
The two most important groups of people for any business - employees and clients - increasingly expect more from Australia's “corporate citizens”.
Research shows a large proportion of the population believes there’ll come a time, probably not too far away, when businesses that think only in terms of maximising revenue and minimising expenses will, simply put, fail.
If that seems a little far-fetched, consider the following…
Employees who are inspired by a clear and strong purpose in their business and whose leaders demonstrate commitment to that purpose are more than twice as productive as merely “satisfied” ones (Bain and Company)
People who experience purpose at work are 2.3 times more likely to be engaged. They’re also nearly three times more likely to stay in their job (Harvard Business Review/The Energy Project)
According to another study, almost 90% of millennials prefer to work for a business that demonstrates values similar to their own. The majority of this group looks beyond the financials of the business when choosing where to work
And as far as customers are concerned, a staggering 94% of executives from companies identified as “purpose-driven” report high levels of customer satisfaction (Deloitte)
For a more detailed answer on why purpose is so important in your business, check out this recent post from us.
There's a challenge for business
There must be.
Because business owners and leaders – certainly the ones we talk to – almost unanimously agree that purpose is an important driver of growth that’s sustainable over time. Yep, you read that right….almost unanimous.
Sadly though, look into how many have done anything about purpose in their business (beyond perhaps creating a purpose statement), and you’ll find a significant drop in enthusiasm.
We know…it’s hard.
Purpose is one thing. Demonstrating commitment to it is an entirely different matter. How can a business rise to the challenge and become “purpose-driven” from top to bottom?
We’re here to help answer that question.
What’s clear is that there's very few (hardly any) practical insights in all the writings we’ve seen. There’s little in the way of guidance on how to go about getting your business purpose down to a few words that make sense.
And most importantly, how to give that purpose “life” in your organisation.
This post is the first in a series focused on precisely that - hints and tips to give life to your business purpose.
Purpose is next to useless on its own
Too many businesses create a purpose statement then go no further.
It’s not enough to verbalise a purpose and expect it to impact your business. That’s just a bunch of empty words and will likely do your business more harm than good.
For example, one of Australia’s major banks tells us in its investor updates that its business purpose is to "back the bold who move Australia forward". We're not sure how many of the bank's staff know it, but it doesn't appear to be something that guides its behaviour - sadly, it comes across as somewhat insincere.
There has to be objective evidence that the purpose seeps through every nook and cranny of the business. All team members, from top to bottom, longest serving to newest recruit, know and understand the purpose.
Ideally, you want everyone in the organisation on board with its purpose - this is one of the critical determinants of the level of employee engagement in the business. Which in turn is proven to positively correlate with customer engagement and, ultimately, profitability.
It also needs to be something customers (and potential customers) identify with. It helps them see your business as more than just a profit machine.
What you want is a business seen as “doing good”. Not necessarily solving one of the world’s really big problems…it can be as simple as focusing on how your business can improve your customers’ lives.
A great example here is IKEA, whose purpose is to make everyday life better for people.
Simple, straightforward and outward-looking (that is, not about profit per se).
There is evidence from around the world that purpose-driven businesses outperform the rest. So it’s an ideal to which business owners and leaders should sensibly aspire.
Where to start?
If you’re a bit foggy about your business purpose, the best way to truly capture (or re-capture) it is to go back to day one.
Why was the business established in the first place? It really doesn't matter whether the business is big, small, old or new….you need to get back to the primary driving force behind the origin of the business.
Here's an example.
If you look into the history of Westpac, originally known as the Bank of New South Wales, you’ll find that it was established by Governor Macquarie to "provide a stable financial institution underpinning an emerging economy".
While we're sure the Governor didn’t talk in terms of business purpose back in the day, this is pretty close to one. And, if the bank was of a mind, it could easily be modernised to reflect today’s economic and social imperatives.
Your business might not be as big as Westpac; if not, it should be much easier for you to go back to your roots to verbalise your purpose.
On a (much) smaller scale, our business is all about “helping business owners and leaders feel safe”. We didn’t initially talk in precisely those terms, but when we sat down to formalise our purpose, we realised it was as simple as that.
How to start?
As you may have gathered by now, your purpose likely already exists in your business…you just might not know it yet.
But as clear as the history of your business might make things, our recommendation is to interview people across the business to hear their stories. You’ll get various opinions, but most likely, a common theme or two supporting the history.
It’s essential to do this in a structured way, with consistent questioning across the board.
Armed with all that input, step back and, using the key theme or themes driving your team, draft your “statement of purpose”.
As we said at the beginning of this post, articulating a purpose is one thing.
Embedding it so that it truly becomes the key driver of your business is another matter altogether.
It’d be great to say this is a linear process, but it’s not. There’s a heap of things that need to be done, many of them concurrently.
And that’s a conversation for another day. Watch for the next instalment in our “Becoming more purpose-driven” series coming soon.
How purpose-driven is your business right now?
If you're keen for immediate feedback on how sustainable your business growth might be over the longer term, please follow the link to our "Strength of Business Purpose Health Check".
It'll take only a few minutes to complete, and you'll get your results instantly.
Is purpose your "business North Star"?
Does purpose inspire your vision and inform your strategy?
How clear are you, your clients and your employees on your business purpose?
The advisers at GrowthCatalyst can help you create and embed purpose and put you on the road to long-term, sustainable and profitable business growth.
Contact us to arrange a face-to-face or virtual conversation.
Alternatively, you can book a time for an initial discussion here.
Why not subscribe?
If you want to ensure you never miss an update from us, please provide your details on our Insights page. We'll add you to our list!