Thursday, 23 February 2012

Have we forgotten our purpose in business?

Ask anyone what the purpose of business is and the first response you may hear is “to make money”. But profit can never be the “purpose” of your business. Profit, essential as it may be, is how you measure the success of your business purpose.  Purpose is all about the “what your business exists to do”.

Some of the greatest companies - both in terms of profitability and in terms of their contribution to the world – have purpose at the heart of their organisations which they live and breathe. Think about the likes of Disney (to make people happy), Ford (Change the world through automation), Dyson (Revolutionalise everyday design), Google (To organise the world’s information), 3M (To solve unsolved problems innovatively). Each of these consistently work to fulfil their core purpose.

A large part of our work is helping leaders connect with their business purpose to build stronger, more powerful and resilient organisations. Here we offer up some thoughts on the importance of purpose.     

1. Purpose helps you leap ahead

Connecting with purpose inspires leaders to leap forward and change the rules of their markets. Amazon is a great example of a company with purpose that continues to change the rules. Its purpose is to create a place to discover and buy anything centred on customer obsession and access to all.

This relentless drive to serve the customer has lead to a raft of firsts - one-click shopping, customer reviews, e-mail order verification. The philosophy is that “People should talk to their friends and family, not to their merchants. If a customer has to call us we have failed them”. So every part of the online experience is geared to making it easy to discover and buy anything.

Even new products such as Kindle fulfil this purpose. Rather than competing with iPad as a device, which focuses on hardware and apps, Kindle is all about media streaming.  It is a portal to Amazon’s cloud universe where users can store up to 20 GB of music for free on the company’s servers (or an unlimited amount of music bought from Amazon) and stream it freely.  Focusing on purpose has not only enabled Amazon to extend beyond buying and selling stuff, but has enabled them to change market fundamentals. 

2. Purpose leads to a happier, more engaged workforce

Helping your employees to engage in meaningful work and feel that they are doing something that matters can help them feel happier and more motivated. A University of Alberta study discovered that people who are able to find meaning and purpose in their work, and can see how they make a difference through that work, are healthier, happier and more productive employees. Urging employees to simply rethink their jobs was enough to drop absenteeism by 60 per cent and turnover by 75 per cent in the companies studied.

You may say that this all very well and good if you are doing interesting work, but what if you are stacking shelves or working on the factory assembly line. Many may define their purpose as being anything other than work! In fact in these instances connecting with purpose is even more important. I have the pleasure of currently working with a manufacturing company where meticulous attention to detail pervades the factory floor, with hours spent polishing, shaping, checking and calibrating to ensure that the finished product is a work of art. Why do they do this? Because the company’s purpose - lived by all - is to raise standards in their industry.

3. Purpose offers a foundation for clear decision making and action

Your purpose will enable you to make tough decisions. It gives you a barometer by which to assess opportunities and decide if they fit with where you want your business to go.

When Steve Jobs took over leadership of Apple in 1997 he killed off a number of high revenue, high profit parts of the business. People thought he was crazy but he had a clear understanding of what Apple stood for. These brave decisions enabled him to focus single-mindedly on the purpose of Apple turning it into the £480billion business that it is today, 15 times the size of Dell.

Importantly in large organisations, where effective decision making is needed at all levels, purpose can help keep people going in the same direction whilst being open to new opportunities. If everyone knows what the organisation is in business to do and is committed to it, then relinquishing control to your people becomes easier. When people understand the why, they can work out the what, when and how.  

4.  Purpose builds brands

The search for meaning is a fundamental part of human nature. At the heart of finding meaning is to connect with something that is relevant to you and provokes an emotional response.  A clear purpose, lived through every part of your business allows people to easily download why you exist. And it is the why that helps people connect what you do with their own values, beliefs and attitudes on an emotional level that enables people to have a powerful relationship with your brand.

With the enormous changes in how people consume and importantly create media (anyone can be a publisher today) it is even more important to ensure you know your business purpose and can demonstrate this, in order to be heard in an ever noisy market space.  

Photo by: KaneroadCul-de-sac

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