“Making a company purpose come to life is an arduous journey that requires a multi-pronged and sustained approach.
The main reason for the gap between intention and reality is that it’s hard to translate the company purpose — however well-defined and inspiring it may be — into how the company operates on a daily basis. So is ensuring it guides everything the company does and drives the expected results.” Hubert Joly
- Make the company purpose as the basis of your strategy.
Making the company’s purpose the cornerstone of its strategy requires reviewing what the company offers. Which activities the company should:
Stop: For example, a wholesaler decided to stop selling cigarettes when they opted to emphasise health as their core purpose.
Evolve: Selling organic food, for example, if they care about the health of their consumers.
Start: New activities aligned with the chosen purpose.
Continue: Retain the business activities that fully support the company’s purpose.
Making a well-defined purpose the cornerstone of the strategy is a game-changer.
Getting there requires not only a solid strategic analysis but also empathetic listening to uncover customers’ underlying human needs.
- Get a grip by overcoming key operational challenges.
Adopting a strategy aligned with a new and powerful purpose shall require significant innovation and stretching into unknown territories. Overcoming these challenges according to Author Hubert Joly, requires: 1) Creating new capacity to explore and pursue the potential new activities or markets identified, 2) developing better agility to generate speed and increase throughput, and 3) nurturing a safe environment that tolerates failure.
Creating capacity can be done in a variety of ways. You may set up a dedicated unit —free to dream up new projects while the rest of the organisation stay focused on the existing business.
Increase speed and throughput by adopting new ways of working through empowered, agile, multifunctional teams. Push decisions down to the lowest possible level, delegating the authority to make decisions. Continuously improve productivity and simplify your portfolio to free up resources that you could invest in new initiatives.
Work on creating a greater tolerance for failure. Innovation cannot happen without experimenting and taking risks. This may mean setting aside a budget for investments without unrealistic expectations of an immediate return. New ideas and pilots can be tested on a small scale so that failures happen early and are contained.
Putting purpose to work is also about winning the hearts and minds of all employees.
- Enable everyone to be a part of the story.
Company purpose becomes a reality only if employees understand what it concretely means and gets personally excited about it.
The process must start from within, and bottom-up. The idea is for each employee to figure out what it looks like for them.
This is what makes purpose come to life — concretely and on a daily basis.
- Align management practices.
Adjusting management practices to make sure they align with the company’s purpose is also essential to making that purpose real. In practice, this may mean resetting how you spend your time and interact with others. What gets more attention or gets discussed first signals what is most important.
You may change management practices by changing metrics. Key performance indicators should measure progress against the company purpose and how it relates to each stakeholder.
Here are examples of indicators measuring how the company is doing with stakeholders:
Employees: Engagement; turnover; diversity, equity, and inclusion metrics; employee ratings and social media comments; best employer status.
Customers: Net promoter score; customer experience, acquisition, and retention; brand love; metrics related to purpose coming to life; progress of specific strategic initiatives.
Partners: fair trade metrics; health of relationships (e.g., growth of relationship).
Community/environment: Carbon footprint; community health (e.g., education, health, the status of social issues).
Shareholders: Total shareholder return (TSR) over time; relevant non-P&L or balance sheet economic items.
Measures assessing progress in implementing the company purpose are not perfect. In fact, defenders of the shareholder-primacy approach often use this argument to criticise the purpose-driven, multi-stakeholder approach for its inherent lack of accountability.
- Create a viable ground for the company’s purpose to fly.
Ultimately, a company’s purpose can only take root and flourish in an environment that inspires, enables, and supports all employees to give their very best. It requires a fundamental revamp of the company’s culture, from the inside out. Five essential ingredients are needed to create and maintain such an environment:
- Explicitly connecting what drives each individual with the company purpose
- Developing authentic human connections within the company
- Encouraging autonomy
- Fostering mastery at all levels, largely through individualised coaching and continuous learning
- Creating a growth environment
Nourish and tend to the environment, and everything becomes possible.