In our upcoming whitepaper, “A Higher Purpose Means Higher Profits,” Vice President of Strategy & Marketing Kevin Randall wrote, “Most companies have visions, missions and values; but having a purpose goes deeper: it establishes a reason for being (beyond economic) and defines individual employee and collective meaning and direction.”
Customers, Organizations and the Rest of the World
An organization’s purpose encompasses its commitments to customers, the organization and the rest of the world. At Movéo, we think of these three groups as “COR” stakeholders. Purpose is the reason for an organization’s existence, materially, economically and emotionally.
Who does your organization serve? How do you serve them? If it’s difficult for you to answer these questions, it may be time for your leadership team to sit down and reconsider your organization’s purpose, and how you intend to further it.
Why Businesses Benefit
Businesses benefit in measurable ways from making purpose central to their strategies. Purpose drives growth, in more ways than one.
Companies that put purpose first have seen enormous growth in the past 20 years. As Kevin writes in the whitepaper, “Babson professor and Whole Foods advisor, Raj Sisodia, studied 28 companies from 1996-2011 and concluded: purpose-driven enterprises (“firms of endearment”) grew by 1647 percent compared to the S&P 500 average of 157 percent.”
This growth was driven in part by people’s hunger to feel that they are contributing to something meaningful. Customers want to patronize organizations that share their values. Employees want to work where they can contribute to meaningful outcomes. These trends are especially marked among millennials. As the generation becomes an ever-larger share of the workforce and controls more purchasing power, no business should ignore these values.
Purpose-driven business can both increase profits and, in some ways cut costs. For example, in serving employees (the heart of the “O” in our COR stakeholders), an organization may choose to invest in employee wellness programs or add office amenities. Over the long term, these initial costs will pay off through lower employee turnover, a more engaged workforce and perhaps even fewer healthcare costs down the line.
How does your organization embody its purpose? What changes can you make to rededicate your business to its COR stakeholders? This month, we’ll explore these questions and more on the Movéo blog.
Photo: photogeek133 via Flickr Creative Commons