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Purpose-driven or cause-driven business? Is there a difference, and does it matter?


Purpose-driven or cause-driven? You don't need to choose.

There are all sorts of ways to skin this cat.


As ever, we here at GrowthCatalyst like to keep things as uncomplicated as possible.


So…is being purpose-driven in business different to being cause-driven? And does it matter? Generally, the answer to both these questions is “yes”.


We say "generally" because it’s fair to argue that for most (if not all) charitable organisations, purpose and cause can be the same.


Being late in the year, our readers most likely have a lot of things on their minds. So this, our last Insight for the year, will be short and sweet!


Purpose revisited


Your business purpose is the core, non-financial reason your business exists (the key word here is “core”).


It guides (or should guide) your strategy and provides the framework for day-to-day decision-making.


By definition, a business can’t “invent” its purpose because it reflects the very reason the business was initially established. What was it that led to the formation of the business? What fundamental challenge was the founder (or founders) driven by?


Without a purpose beyond making money, why does your business exist?





That’s the purpose.








And if it’s not at the core (there’s that word again) of your business, it’s hard to imagine what’s keeping all the various elements of your business pointed consistently in the right direction.


As to being cause-driven...


Cause-driven businesses tend to be passionate supporters of a social objective. And there’s nothing at all wrong with that.


Employees and consumers now expect business to help drive social change




More broadly, we believe every business should have a social conscience and aim to be a better “corporate citizen”.







That includes being aware of and minimising your impact on the environment and ensuring you have appropriate policies in place around diversity and other employee issues, among other things. In fact, employees (and potential employees), along with consumers and other stakeholders, increasingly demand this of businesses with which they engage.


Being cause-driven or supporting a social good

will give your business A purpose,

but it’s not usually THE purpose of a business.


As we mentioned, purpose-driven and cause-driven are virtually indistinguishable when it comes to charitable organisations. The causes these businesses pursue and support are, in fact, why they exist.


The Smith Family, for example, is clear on its purpose: “To overcome educational inequality caused by poverty”.


Does the difference matter?


Again, the answer is a resounding “yes”.


This is why we believe businesses should be both purpose-driven and cause-driven.


We absolutely believe that businesses should have a very well-developed social conscience and always act in the very best interests of society in general. And it’s OK to support a specific cause or causes (though some care needs to be taken to avoid alienating segments of your target customer/client base).


But let’s look more deeply into the fundamentals of business purpose as we defined it earlier.


We mentioned it’s hard to imagine how a business that isn’t purpose-driven stays on track…or even, frankly, what track it should be following. Purpose gives a business a consistent thread through each phase of planning, as shown in the graphic below:


Purpose is the foundation for all business plans

You can see how purpose drives the planning process from start to finish.


The practical result of this provided it’s implemented well, is more highly engaged employees and more satisfied and engaged clients/customers. Your employees better understand the contribution they make to the success of the business, and, provided your message is clear, your clients/customers become more emotionally attached to your business (think Apple or any of a number of businesses that’ve managed to create some of the most engaged customers on the planet).


It’s an important distinction


Clarity of purpose and excellence in embedding it in your business is, ultimately, a driver of better business performance - estimates range from around 20% to 40% uplift in earnings. Much evidence globally supports this, dating back to the 1960s. It can be your "business super-power".


Supporting a cause or causes will win you a great deal of support from employees and consumers - again, the research proves this.


And being a good corporate citizen is something that…well…you should want to do.


It would be best if you were “all of the above”.


For longevity and the creation of a sustainable rate of growth over time, being truly purpose-driven should come first.



Do you want your business to be more purpose-driven?


Are there causes you want to support?


Why not do both?


GrowthCatalyst can help you answer these questions and more.


We invite you to contact us to arrange a conversation, face-to-face or virtual.


Alternatively, you can book a time for an initial discussion here.


How strong is purpose in your business?


If you're keen for immediate feedback on the strength of purpose in your business, please follow the link to our "Strength of Purpose Health Check".


It'll take you no longer than three minutes to complete, and you'll get your results instantly.


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