Organizations of tomorrow need to lead with their purpose
NEXT EXIT: Tomorrow
[Editor’s note: This is the fourth article of a new weekly series on top trends and implications for consumers, organizations and communities from SIR’s Institute for Tomorrow. Our view of the future is through the lens of the people making it happen. Subscribe at institutefortomorrow.com.]
It used to be that nonprofits and religious organizations were the only ones who talked about their “purpose.” If anything, they had cornered the market on doing things for a reason beyond profit. Think Red Cross, Salvation Army, Little Sisters of the Poor, United Way, your local church.
Corporations, even as recent as 5 years ago, were almost exclusively focused on profits, shareholder return, and the bottom line.
But now it takes more to win over customers. Today, you need a purpose, something larger than who you are, what you do, where you do it, or how you do it. Organizations need a “why.” Why are you in business? What is your reason for existing? What are you doing to contribute to the greater good?
If you are not answering this question for all your stakeholders, you’re in trouble. If not today, you will be tomorrow.
That’s because the future belongs to organizations with a purpose that aligns with consumers.
How This Happened
This didn’t happen overnight. The macro trend impacting this is America’s slow shift over the last 60 years away from being a closed society to one that is open and transparent. One example: think about how we designed offices back in the 1950s. Long halls, offices with doors, no way to see inside. Offices today are designed to be “open concept,” with even the C-suite sitting with the troops.
If you look around, practically everything that was once private and hard to uncover is now public and a click or two away: Your closely guarded Rolodex is now your public LinkedIn profile. How much you paid for your house isn’t filed away at the courthouse; it’s online at Zillow. Your drinking buddies, church Sunday school members, and neighbors are all intermingling on your Facebook page.
At every turn you’re prompted to share what’s on your mind, what you’re doing, where you’re eating. And as people have moved down the path of being more open and transparent, it’s only natural that companies have followed.
These days companies have to share publicly all that they do, think, or feel. Just like people. No longer can an organization have placards framed at headquarters with their mission statement and values. Now, besides posting those on their website, they have to talk about their purpose, or “why.”
Since this is new, it’s no wonder one of the most popular TED Talks in recent years is the one Simon Sinek gave on the importance of having a “why.”
Here’s the Rub
For most corporations, this is a different way to think and operate. Many are excited to talk about their “why” (see TOMS). But it can be problematic. An organization’s purpose needs to last longer than the next quarter’s earnings report. It needs to be rooted in who, what, when, where, and how the organization operates and talks about itself. It needs to be part of its culture, if not in the original DNA. It can’t be fleeting.
Yes, one can bolt a “purpose” statement onto a corporation. But if it isn’t genuine and based on reality, that will backfire.
The Generational Dynamic
Our culture today is being shaped by Millennials, who can smell fake purpose statements from the next area code. Companies and communities who lay claim to a greater purpose beyond the bottom line risk getting called out if they are not authentic.
Interesting, this corporate embrace of purpose is having an impact on nonprofits. Why go work for a nonprofit to “change the world” when every Fortune 100 company — and Internet start-ups with stock options — are now claiming their purpose is to “change the world?” The competition for talent is intensifying.
We’re recently seen research on Millennials revealing their career goals are to “make a difference.” Back when Boomers and Gen Xers entered the workforce, their goals were to “make a living,” or at least start a career. Making a difference comes later, once you know what you’re doing. Not so for Millennials. Making a difference is the top goal and organizations with an authentic purpose, and who talk about their purpose, will have an advantage over those who don’t.
Next Week: What Do We Know So Far About Generation Z?