If you are new to this topic or reviewing purpose in your business, what steps should you take to ensure you are on the right track? I provide an outline of what purpose is, why it’s important and a 5-step checklist you can use as a guide.
Promoting your Business
How to Use Purpose to Grow Your Bottom Line
There was a time when business purpose could be easily dismissed as a fancy statement that gets ignored. However, leading businesses are putting it at the centre of everything they do to inspire their workers, delight their customers and grow their bottom line.
THE CASE FOR PURPOSE
A Harvard study of 28 companies with compound average growth rates of 30% or more over the previous 5 years found ‘purpose’ was central to their performance. Global research by Fortuna Advisors and CECP found that higher purpose companies have higher market valuations, and the size of the gap has widened during the pandemic.
In Tribal Leadership the authors find that a common trait of serially high-performing companies is that employees see themselves as part of a team pursuing a social mission – they become motivated and excited by their work and the results flow.
If you’ve ever felt that sinking feeling when workers are more concerned about their own power and ego than they are about customers or colleagues, purpose is the ideal mechanism for turning it around and building high-performance cultures.
WHAT IS PURPOSE IN BUSINESS?
Purpose is essentially the promise you make to your customers about solving their problems and improving their lives. People want to know what you stand for and your purpose must be recognised, revered and practised thoughtfully by everyone – it becomes your guiding light when difficult decisions and trade-offs must be made.
Purpose statements express the desired outcome – not an activity. Describing your purpose as making cars is quite different from creating sustainable transport solutions.
At a practical level, a small company I recently worked with had several reasons for clarifying its purpose including the need to attract younger workers, energise its staff and succinctly communicate its direction to shareholders and business partners.
CRAFTING A PURPOSE STATEMENT
One of my favourite purpose statements comes from Cochlear, which aims “to help people hear and be heard”. Another is from the junior mining company, EQ Resources, which re-processes mining waste for strategic metals with the purpose of “resourcing the new economy for a better tomorrow”.
As a service provider myself, I’m helping executives and leaders “develop profitable businesses that support the lives of people and the planet.” Size of the organisation doesn’t matter when it comes to purpose.
When crafting or reviewing your own purpose statement, I suggest you first ensure that it conveys a benefit to society and then check that it inspires employees, resonates with customers and has the right scope in terms of what you do and don’t want to do.
A 5-STEP PROCESS
Unfortunately, crafting a great purpose statement isn’t enough on its own, you have to follow through and embed it into everything you do if you want to harvest the benefits and it’s not as hard as you might think. To help visualise the process, I advise business leaders to focus on these five steps.
Phil Preston Business Purpose Guide
Phil traded in a high flying corporate career to help businesses become more profitable while also supporting people and the planet. He is a speaker, facilitator and strategist, and the author of Connecting Profit With Purpose.
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