Does your business have a purpose? If you decided to read this article it might very well be that you’re looking for one. Although we see an increase in businesses that adopt a purpose, it’s still a pretty new thing, certainly in Malaysia. And that means when we speak to business leaders we often hear similar stories about business purpose and why they believe it’s not important to their business. Many of these ‘stories’ are unfounded and so it’s time to address them. And of course we’ll end this article with reasons why you would want to adopt a purpose for your business.
Let’s have a look at the 6 most common myths about business purpose. Perhaps you recognize them.
1. Our brand/company is too small to make any impact.
This is such an interesting statement, which we picked up at a local organisation which has a reach that stretches into Asia. And here’s why it’s interesting. In Malaysia there are a growing number of organisations, many of them social enterprises such as Picha Eats, Urban Hijau and Biji Biji, who on a daily basis impact the lives of many people in a positive way. Many of these organisations are just a handful of people dedicated to their purpose. So if a handful of people can impact many lives, doesn’t that mean that your organisation with 500+ employees has a huge potential to impact the lives of others?
2. Going for a better world is not something we (company leaders) feel is important.
Fair enough. No one is obliged to go for a better world if you truly don’t believe in it. It would actually be really incongruent which would probably mean your efforts will fail. However you might run into a challenge in the future for your organisation. Today more and more people across generations (but certainly the younger generations) do care about making an impact, it’s going to be harder to retain these people or attract them to your business. One of our clients in the oil and gas industry admitted to us that they had challenges retaining staff due to the lack of purpose.
On the other side, there’s also a slow but steady move of investors seeking to invest only in organisations that take people and planet into consideration. Black Rock is probably the most well known example of this. They now actively steer the businesses they invest in to be purpose-driven. Another example is a small group of investors who are steering Royal Dutch Shell to become more dedicated to the renewable energy agenda.
3. Our clients are not interested in a better world.
There might be truth in this statement. Depending on the category where your products or services sit, your consumers might not be so concerned about your purpose or a better world. That being said, there is a global trend of consumers looking for brands to be more purpose-driven. So whilst this might not be of immediate concern, it is likely to affect every business in the long run.
4. There’s no need for purpose, profit is what’s most important.
No business can survive without profit and so you better make sure you have a healthy profit to start with.The good news is profit and purpose can go hand-in-hand quite well, they do not have to be polar opposites. In recent years, more and more evidence is showing businesses that have a clear purpose actually outperform the businesses that do not have a purpose. So if you are currently looking to be more profitable, perhaps it might be a good time to start with your purpose.
5. We are just ____ (fill in the blank) business, no need for big fancy purpose.
Getting a purpose might sound like a fancy or trendy thing to do, and perhaps it is. For the readers of this article who are the founders of their business, just go back to the times when you started your organisation and for those readers who are not the original founders, go ask the founders about the following. When you would ask founders of businesses why they started, the answer is likely not because they wanted to get rich; they could probably have taken a job somewhere and make more money immediately. Many business founders will tell you that they just couldn’t stand seeing a specific problem and wanted to do something about it. Others share they wanted to show their father or someone else they could achieve more, or reduce poverty because that’s how they grew up. That’s the purpose right there.
All of that is not fancy, that’s the truth and it’s worth starting a business for. If you believe there’s more to your business than making profits, you may want to consider crafting that something into a purpose statement.
We hear you. Unfortunately the way business works today isn’t ideal. Running a business just for profit isn’t sustainable in the long run. And too often leaders are under pressure to deliver results in the short term rather than the long term. You may find yourself in a place where you need to influence the board or CEO for going a more purposeful direction and this might be an uphill battle.
So here’s an advice from Simon Sinek that we love going back to, “be the leader you wish you had”. In other words, do whatever you can to stay aligned with your purpose, lead by example and do the right thing. Perhaps one day you’ll see change in the people around you, and if not, at least you did what you could.
Why a purpose might be beneficial for your business
So what if you did have a clear purpose for your organisation? We thought you’d never ask (is it too obvious that we love talking about purpose?). Here’s a couple of things we know a clear purpose can do for your organisation.
- Bind people together
Today more than ever before people want to feel they are adding value and that their work is meaningful. A purpose statement (combined with the right actions) helps employees see that their work leads to more meaning in the (long run?)
- Gets people to go the extra mile (without carrots and sticks)
Money only motivates in the short run. Doing something meaningful however motivates people to keep giving. Build an organisation around purpose and you will find people around you that will keep giving and fighting for your purpose.
- Allows you to pivot faster
Innovation in essence, is about solving real problems. Having a purpose is about solving a problem you see in the world. When your products or services are aligned to the problem you’re solving, it’s much easier to find a new way of delivering solutions when your market gets disrupted. It’s the very reason why Fujifilm went from a dying category of making camera films to cosmetics. They are seemingly unrelated but Fujifilm saw it differently. In this article they say: “We spent many years pursuing beautiful skin in our film imaging business, and our accumulated technologies and perspective came in handy in our cosmetics efforts, too.” Their essence of pursuing beautiful skin helped them pivot into unknown territory.
- Encourages long term decision making
Sometimes decisions today can be painful but you know in the long run they are the best for your organisation. When Nike decided to stand by Colin Kaepernick when he kneeled for the Black Lives Matter movement, Nike knew they were likely to lose customers, and they did. They didn’t back away from what they believed in, and eventually saw their sales come back.
- It guides as a compass when tough decisions need to be made.
In recent years we’ve seen clients make decisions for the short term. Such as adding preservatives which would lead to an immediate cost saving. If you however stand for food that is natural and healthy, that decision would have never crossed anyone’s mind as it goes against your very purpose. In the short term, that’s not going to give you a cost saving, although it will push your team to search for other ways to make the cost savings happen.
Hopefully this article has taken away some of the myths around having a business purpose. Perhaps you are now curious about your business purpose, whether it is to become more innovative, attractive to employees and consumers or maybe just because it can increase your profits. Whatever the reason, we’d love to explore your business purpose with you. Send us a message to schedule a free consultation.