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Create and implement a purpose-driven strategy for your business

Stick figure looking at sign posts saying good choice
Strategy is all about choice. Purpose helps you make the right ones.

It would be difficult to mount a compelling argument against this statement:

These days, it’s harder than ever to create and execute a great strategy for your business.

The environment in which most businesses operate is much more fluid than ever, clients are more demanding, and it’s way more challenging to find, attract and retain the best possible talent.

With those factors and others at play, it can be difficult for business owners and leaders to think much beyond the end of the week. Thinking about longer-term goals and objectives and what needs to be done to achieve them can feel like a challenge best left for “some other time”.

To set the scene for a change of mindset, we’d like to pose a question:

What’s driving your business strategy (assuming you have one)?

It’s most likely a question you’ve rarely – quite possibly never – considered. At least part of the reason for this is that strategy in many businesses is a one-off “event” rather than an integrated, ongoing process that receives regular attention.

While there are many ways to define the term “business strategy” (Google it…you’ll see what we mean), it comes down to this:

Creating your business strategy is all about identifying the longer-term business initiatives you need to execute successfully to give your business the best chance of achieving what you want it to.

That sounds simple enough. But if it’s so simple, why do so many businesses admit to either not having a clear strategy at all, or having a strategy that’s not fit for purpose?

The word start showing on a green mat
Your strategy needs a starting point

The answer is usually the need for a starting point. A strategy must come from somewhere, and making it up on the fly won’t work. For strategy (and everything that follows it in the planning process) to make sense, there must be a set of guiding principles. Without that, what you’ll end up with will be no more than a long-term to-do list.

Step one: Remember: it’s all about purpose

Your business purpose provides that direction. Given that purpose is the reason your business exists beyond the pursuit of revenue and profit, it stands to reason that it should be the basis on which strategy ought to be formulated.

A purpose-driven strategy is exactly what it says on the label – it’s one where all the design cues from purpose above all else. Every component of a strategy created in this way should clearly help the business achieve its growth and other aspirations, all while delivering on its purpose.

The first step in creating a purpose-driven strategy is, not surprisingly, to be clear on what your business purpose is…very clear.

Step two: define (or re-define) your business purpose

For an in-depth look at how to make purpose your "business super-power", check out this Insight.

In short, how you should approach the “purpose challenge” depends on the answers to three questions:

1. Are you the founder (or one of the founders) of the business? If so, you have an advantage. You’re likely pretty clear on your business purpose. You may never have articulated it as a “purpose”, but think about what drove you to start your business. What were the challenges you set out to solve for your prospective clients? What did you believe you could do differently in your market for better client outcomes?

2. How old is your business? It’s fair to say that the longer your business has existed, the less clarity there’s likely to be across the business as to purpose. As a founder, you may still have it firmly in mind but what about everyone else in the business? Purpose needs to have a deliberate focus in a business, and that focus is naturally likely to diminish over time. It’s not the end of the world, but it simply means you’ll need to put some energy into its reinvigoration.

The word purpose spelled out on small wooden squares
Getting clear on your business purpose takes some effort. And it's absolutely worth it.

3. How large is your business? There’s a clear negative correlation between the size of a business and clarity of purpose. Generally speaking, and again not surprisingly, larger businesses tend to enjoy lower overall purpose clarity. Size isn’t an insurmountable hurdle and simply means more effort will be required to bring purpose to life.

Evidence globally points to the fact that where driven by purpose, strategy is likely to be well executed (more on that later).

Step three: communicate the purpose

This starts with the leaders in your business. As part of their role, they should have an explicit responsibility to be champions of your business purpose and lead the internal conversation.

This doesn’t only apply to those who hold formal leadership positions. There will be others in your business who are “influencers”. These are the people to whom others look for informal mentoring, guidance and support. You probably know who they are.

How does this support strategy?

Everyone needs to understand and buy into your business strategy. Its execution depends, through business-wide action planning, on the focused efforts of all your employees. Not just some of them.

When they understand your business purpose and know the business stands for something other than revenue and profit, there’s a greater likelihood they’ll also “get” the strategy.

You should, by now, see how communicating purpose within the business is an essential pillar in creating and executing a great strategy: purpose provides strategy with context for those not directly involved in its formulation. You can read more about connecting employees to purpose and strategy in this Insight.

This purpose-driven approach will likely raise a few challenges because a shift in mindset is often required away from the more traditional profit-first approach. The graphic below illustrates what we mean:

Creating a purpose-driven strategy may need a shift in mindset

In making this shift, you need to cover as many bases as possible. For example, think about how you can include purpose-related objectives in KPIs across the business.

You can also rework your team meetings. Most of these tend to open with a conversation about sales and revenue. Try starting yours with stories about how employees have delivered purpose-driven outcomes for clients.

You’ll find soon enough that everyone gets on board with the idea that without purpose, a business can very quickly wander off course.

Step four: develop your strategy

There are so many ways to go about developing a strategy. There are models galore to follow if you so choose and an array of processes to select from.

We like to keep things relatively simple, and even though we’re talking about longer-term planning when it comes to strategy, that’s not a good reason to make it complicated.

And there’s quite a lot of confusion about some of the terminology used in the context of developing strategy. We believe there’s no need to get too bogged down in all of that.

Since we’re talking about creating a purpose-driven strategy here, that should be the central theme running through whatever process you choose to call your own.

Remember, too, the reason you have a strategy – to be clear on the longer-term initiatives required to give your business the best chance of achieving what you want.

That said, there are some key things we recommend you should build into your process:

Be clear on your vision

Where do you (realistically but aspirationally) want to take the business in future, and in what time frame? We recommend you think three to five years out because any longer than that becomes too much like trying to read a malfunctioning crystal ball. Again, the important question to ask about your vision is whether it’s appropriately informed by your purpose.

Determine the current state of the business

It’s important to know your starting point so you can assess the size of the task ahead. Be realistic about this…there’s no point in pretending your business is in better shape than it is. That would immediately set you up for failure. A good way to get an accurate picture of your business is to run a diagnostic. Check out this Insight for more on that.

Run a SWOT exercise

It’s an oldie but a goodie. Being clear about your strengths, weaknesses, opportunities and threats provides a solid footing for your strategy. Again, be realistic about this exercise. Here are the rules:

  1. Don't overstate your strengths - you'll get found out at some stage;

  2. Don't ignore your weaknesses - others, including clients, employees, and other stakeholders, probably won't. Your competitors definitely won't;

  3. Don't try to shoot out the lights with your opportunities list - again, a realistic but aspirational approach works best;

  4. Don't play down threats to your business - they're out there, and you need to be ready to address them should they become a reality.

Since you’re setting out to create a purpose-driven strategy, you should also undertake your SWOT analysis in that context. By that, we mean your strengths and weaknesses should be assessed in terms of helping or impeding the delivery of purpose-driven outcomes. And the same goes for opportunities and threats.

Identify your most impactful initiatives

With the first three steps above done, you’re now in a position to work out what needs to happen if you’re to meet your long-term objectives in a purpose-driven way. We keep saying it, but please be realistic and aspirational. Consider time frames, resourcing issues and, of course, funding requirements.

Document and communicate

Documenting your strategy helps make it real for everyone in the business. Keep it brief and ensure it covers the key things everyone in your business should know about. A document is one thing, but communicating your purpose-driven strategy clearly and frequently to all stakeholders improves your chances of achieving your objectives.

When employees, in particular, are clear on the big picture and their role in making that real, there’s a natural uplift in engagement which helps attract and retain the talent you need to get things done. Read more about helping your employees “get” your strategy here.

Review the strategy

As we suggested at the start of this post, strategy isn’t a one-off exercise. It should be an ongoing process in your business. Once your strategic direction and initiatives are set, regular and active review is essential to take account of changing internal and external factors.

Which leads nicely to….

Step five: measure the impact of your purpose-driven strategy

You may think you’ve developed a killer purpose-driven strategy, but how will you really know unless you measure results?

Start by ensuring all the objectives from your planning process are clear and directly related to the business purpose.

When setting objectives, a key question for everyone should be, “Does this particular activity help us deliver on our purpose”?

If not, then the objective should be reworked or discarded altogether.

Likewise, individual KPIs should clearly and positively impact the delivery of your purpose-driven strategy.

With objectives and KPIs in place, don’t overlook the need to keep an eye on progress toward achieving them. It’s essential that you put in place a system for tracking the activity that’s required so you can take quick action if things start running off the rails.

To make this part of the process as straightforward and consistent across your business as possible, you might consider using the Empiraa platform. We’ve partnered with them to benefit our clients who need a simple and effective system for managing strategy and business plans. You can learn more about Empiraa here.

As part of your ongoing strategy tracking and review, it’s ok to make changes to keep your strategy as closely aligned to purpose as possible.

The lack of follow-up and frequent review is the key reason strategies fail in business. You can't treat it as a set-and-forget activity.

Is your strategy purpose-driven?

Do you have a strategy development process in place?

Do you review your strategy often, and in a purpose-driven way?

The advisers at GrowthCatalyst can help you in your quest for a purpose-driven strategy.

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

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

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.

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