Excelling in Inspiration to Excel in Execution… Are You Tapping the Power of Purpose?
Lessons & Opportunities for the Mid-Market
If you were just to go by the headlines, you might think the business world was dominated by high-profile startups (mostly, the quest for the next “unicorn”) and the corporate giants of the Fortune 500. But the media’s perspective doesn’t adequately acknowledge the power and potential of the substantial middle market — typically defined as businesses with revenues in the $50 million to $1 billion range.
Middle-market companies may fly somewhat under the radar, but their importance to the economy is unmistakable: collectively, they account for 24 million jobs and some 40 percent of GDP in the United States. The middle market is an engine for the creation of good jobs. And they offer powerful lessons and insights for businesses of any stripe.
They’re not under the radar to us at Emotive Brand. We have worked with middle-market companies since we launched our agency in 2008. We’ve seen first-hand just how innovative and dedicated they can be. We’ve felt their drive and commitment. We love working with these companies on the most important strategic challenge: sustainable growth.
Through our work, and our research on other businesses, we have identified one asset that separates growing businesses from those at risk of stagnation: a strong, overarching sense of purpose.
Unlocking Sustained Growth
Today’s business climate is volatile and complex. Nothing is a given. There are no certainties or guarantees. Ambiguity is the order of the day. Turbulence is the new normal, adding another layer of difficulty to the ongoing challenge of growing profitably and sustainably. Nonetheless, some companies are clearly better at navigating these choppy waters.
Our first-hand experience and a large-scale review of published research point to several attributes that separate mid- market companies capable of sustained growth from mid-market companies that are stagnating or declining. Growing companies are more adept at aligning their organizations’ people and practices around what can seem to be competing priorities:
• They execute effectively in the present. Growth companies get today’s business done.
• They evolve quickly, shedding unproductive practices, ideas, models, and attitudes that have lost their relevance and are destined to become obsolete. Growth companies retire outmoded approaches.
• They consistently originate breakthrough ideas and convert them into new sources of savings, differentiation and profits. Growth companies innovate continuously.
You might consider all of these ideas to be evergreens of strategy — and they certainly fall into the category of easier to articulate than to put into practice. But we’ve discovered an approach that facilitates an organization’s ability to adopt these strategic imperatives:
Successful, growing companies have tapped into and activated a powerful asset: the power of purpose. They think differently about the significance of their business. They are adept at making their people part of a collective narrative that both inspires them today and keeps them focused on working together to achieve a greater goal. They respond quickly and effectively to a rapidly changing world.
The Power of Purpose
Growth companies embrace the power of purpose. They have learned how to unlock that power to catalyze the transformations, big and small, that nurture and sustain growth. Purpose becomes more than a component of their existing brand vision. Purpose is strategic, a potent asset that engages and focuses people at all levels and in all aspects of the business. With a strong sense of purpose, people work not just to make today better, but to move beyond old ways of operating that are no longer relevant and create fresh ideas for processes, products, and new lines of businesses.
Purpose aligns today’s actions with a strategic focus that goes beyond short- or near-term goals. It helps create nimble culture that fosters synergy between the business and brand strategy. It enables sustainable growth.
Excelling in Execution and Inspiration
We believe that leaders can improve their organization’s ability to sustain growth — and elevate their ability to adapt — when they embrace an authentic purpose. But we’re not alone in our belief: business academics have come to similar conclusions.
For example, research done by Ohio State University and the National Center for the Middle Market compared sustained growth companies to non-growers in terms of what they considered important. As the chart shows, growing companies place more importance on talent, innovation, vision, market expansion, and internal processes.
This research supports our belief about the power of purpose: When companies articulate and embrace a meaningful
purpose, their people naturally pay more attention to all the elements that drive sustainable growth.
When you understand why you exist, when you embrace the positive impact you can and do have on the world, and when you infuse this sense of purpose throughout your organization, your workforce will embrace the necessity of change and apply their energies accordingly in pursuit of growth.
A Culture of Purpose is a Culture of Growth
We can’t know if the companies examined by the researchers at Ohio State were actively cultivating their sense of purpose, but we can tell from their data that they have cultivated very strong cultures:
• Nearly 70% of the “sustained growth companies” indicated very good to excellent performance in retaining talent, while 63% cited excellent or very good performance in keeping the workforce engaged and in ensuring a skilled workforce.1
• The same study, reports that nearly three quarters of sustained growth companies considered their organizations adept at creating a culture that encourages ideas and experimentation, projecting a clear vision throughout the organization and communicating leadership’s vision.
And a Harvard Business Review report titled “The Business Case for Purpose” (sponsored by EY) made the connection between purpose and key factors of success succinctly:
Companies with a strong sense of purpose are able to transform and innovate better. Those executives who treat purpose as a core driver of strategy and decision-making reported greater ability to drive successful innovation and transformational change and deliver consistent revenue growth: 53 percent of executives who said their company has a strong sense of purpose said their organization is successful with innovation and transformation efforts, compared with 31 percent of those who are trying to articulate a sense of purpose and 19 percent of the companies who have not thought about it at all.
Source: “The Business Case for Purpose,” Harvard Business Review Analytic Services Report
Purpose is a powerful asset. Yet purpose remains an under-appreciated in many organizations, an asset that has the power to address the issues that can unlock sustained growth for mid-market businesses.
We believe that discovering and articulating your company’s authentic purpose can help you develop the capabilities and focus required to respond to a rapidly, constantly changing environment with more agility and, ultimately, to fuel growth.
A strong purpose provides a powerful way to:
• Engage your workforce
• Build alignment and clarity of action across teams
• Encourage and motivate innovation
• Adapt, evolve and transform constantly
Growing with a Purpose
Now that we’ve made the case for the power of purpose to fuel growth, let’s turn to the notion of purpose itself. What do we mean by purpose?
Let’s start with what purpose isn’t. Your purpose is not “to make more money” or “build shareholder value” — although those goals are undoubtedly crucial to survival. Purpose is an organization’s core “reason for being.” Purpose is the single objective that unifies all stakeholders and articulates the business’s ultimate role in the broader economic, societal and environmental contexts. Purpose rises above narrow financial self-interest and addresses human, societal, and even existential questions:
• Why does your organization matter to the world?
• What is your organization’s reason for being beyond generating profits?
• Why does society provide the license and freedoms — the structure — for an organization to operate, and what conditions are necessary for those freedoms to continue?
A focus on purpose acknowledges the interdependence of business and society, which is the key to creating an internal culture of purpose. A 2013 study from Deloitte (http://www2.deloitte.com/us/en.html) directly confirms that organizations that focus their energies beyond pure profit do better than those without a culture of purpose.
In the same study, organizations with a culture of purpose report heightened clarity, commitment and coordination in their operations. Essentially, focusing on purpose unlocks the best of what an organization can do and be:
• By showing authentic respect for the whole person in creating a committed workforce, loyal customers, and supportive governments and regulatory agencies.
• By operating freely and responsibly to create new goods and services that society wants.
• By demonstrating empathy toward communities that provide new markets and customers they are able to attract more of the best talent and grow new markets; building long-term relationships that foster loyalty and trust, rather than mistrust and its associated costs;
• By nurturing decision-making that engages with the workforce to encourage innovation and take responsibility for keeping the company true to its purpose.
In a world of constant acceleration and increasing volatility, purpose provides a stable, inspiring, desirable human goal to navigate towards. Purpose unites individuals and teams around a common mandate that truly matters, increasing the bond between them and their trust in one another. Finally, because of its aspirational nature, purpose motivates people to think and act creatively, to innovate and improve continuously.
In an article in Forbes titled “Why The Best CEOs Consider Purpose Before Profit,” Natalie Burg wrote, “when leaders leverage purpose, it creates a competitive advantage that’s difficult or even impossible to replicate.”
Caveat: These benefits presume that your purpose is genuine and authentic. If the business’s stated purpose does not match its actions, internal and external stakeholders will view it with mistrust and skepticism and perceive it as mere “window dressing.”
Interestingly, in a recent study by Bursten Marsteller entitled “How Authentic is Your Corporate Purpose?” (February 2015), more than a third of the executives surveyed had considerable difficulty identifying a single company that they perceived as having an authentic corporate purpose. This finding points to the fact that, while many companies may “talk the talk,” they do not necessarily “walk the walk” when it comes to their stated purpose.
Purpose, therefore, can’t be created or manufactured. It must be uncovered, revealed, articulated, and communicated. But when you’ve done that work, purpose can be a potent strategic tool for unlocking and accessing new levels of the collective intelligence, strength, flexibility and speed in your organization.
In fact, in our seven-plus years of experience as a firm, we have found that embracing an authentic purpose is a sure- fire route to boosting performance on all of the key dimensions that separate sustained growth companies from non- growers.
Unlocking the Power of Purpose: Getting Started
Here’s the paradox of the power of purpose: Something that has the power to drive your entire business to new heights is something you already have. It’s there, right in the DNA of your organization, but it may not be fully revealed, fully articulated, or fully realized.
At Emotive Brand we offer our clients a tool we call “Path to Purpose” — a highly focused, hands-on, and personalized engagement designed to unlock your authentic purpose and set the stage for integrating it into your operations.
The process begins with understanding what you do and how it matters before moving on to the deeper question of why. The goal is to come to an artful synthesis of why you matter in the largest and most important sense. This is the foundation of a collective narrative, a story that is authentically yours and that offers a unique difference.
Articulating the purpose — giving words to your narrative — is actually the easy part. Learning to live your purpose is harder. We’ll help you determine how to apply it to your operations, your style of decision-making, and your processes. It will almost certainly influence your marketing and communications strategies and how you and your employees behave internally. And it absolutely will influence how your people think and feel about their jobs and your business.
Your purpose is an asset waiting and ready to fuel your business — whether you’re going too slowly or even if you’re thriving today. There is no “wrong” time to define your company’s core purpose.
For those who would like to explore the power and potential of purpose further, we recommend these reports, articles, and case studies.
“The Business Case for Purpose.” EY-Harvard Business Review Analytic Services report, Harvard Business School Publishing (2015)
“Purpose Beyond Profit.” Tracy Lloyd, Emotive Brand (2014)
“Why The Best CEOs Consider Purpose Before Profit.” Natalie Burg, Forbes (March 2015) “How Authentic is Your Corporate Purpose?” Burson-Marsteller (February 2015) “Creating Shared Value.” Michael E. Porter, Mark R. Kramer, HBR (2011)
“The State of the Debate on Purpose in Business.” EY Beacon Institute (2016)
“Business Leaders Urged to Find a Purpose in Life.” Roger Trapp, Forbes (March 2015)
“From Purpose to Impact.” Nick Craig and Scott A. Snook, Harvard Business Review (May 2014)
Taylor Standlee, Strategy Director
Tracy Lloyd, Partner Emotive Brand
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