An organization should exist to serve a meaningful purpose and not just for creating profits. Purpose defines why an organization exists. A strong purpose has the promise of striving for something better.
A purposeful business is one that creates profits only through creating value for society. A purposeful business uses their expertise to solve social problems which can ultimately lead to higher profitability.
What should a purposeful business look like?
A purposeful business has to be authentic and measurable. And to deliver this purpose, a strong internal culture, clear values and behaviors that every employee understands should be developed. This leads to greater productivity in the business.
Important human values and purposes are usually visible to the outside world and they regularly engage customers with them.
According to the British academy, a purposeful business will organize itself on all levels according to its purpose. Eight principles were proposed for business leaders. These principles do not prescribe specific actions, but set out the features of an operating environment that will enable the delivery of those purposes while remaining flexible to a diversity of business models, cultures and jurisdictions.
- Corporate law should place purpose at the heart of the corporation and require directors to state their purposes and demonstrate commitment to them.
- Regulation should expect particularly high duties of engagement, loyalty and care on the part of directors of companies to public interests where they perform important public functions.
- Ownership should recognize obligations of shareholders and engage them in supporting corporate purposes as well as in their rights to derive financial benefit.
- Corporate governance should align managerial interests with companies purposes and establish accountability to a range of stakeholders through appropriate board structures. They should determine a set of values necessary to deliver purpose, embedded in their company culture.
- Measurement should recognize impacts and investment by companies in their workers, societies and natural assets both within and outside the firm.
- Performances should be measured against fulfillment of corporate purposes and profits measured net of the costs of achieving them.
- Corporate financing should be of a form and duration that allows companies to fund more engaged and long term investment in their purposes.
- Corporate investment should be made in partnership with private, public and not for profit organizations that contribute towards the fulfillment of corporate purposes.
Benefits of a Purposeful Business.
According to Harvard Business Review, purposeful business are 202% more likely to be profitable. It may sound counterintuitive, but when you focus on tackling a large global issue instead of sales, you are much more likely to find success.
“The secret to success is the constancy of purpose"
Not only will you experience more financial success as a purposeful business but you will also experience the backing of a driven team who cares about the value they bring to the table.
"When you're surrounded by people who share a passionate commitment around a common purpose, anything is possible." Howard Schultz, Starbucks.
How To Build Purpose Into Your Business.
Align with a higher purpose.
A purposeful business should be looked at as something bigger. The goal of this is to move from sales to a higher purpose. If you feel disconnected from your business, you're likely looking at your business in isolation. Therefore, you have to consider what higher power, force or energy you can tap into to help your business feel bigger than you.
Allow your purpose speak for your business decisions.
When you approach your business deals as your most purposeful self, you bring more meaning to your decisions. Your prospective employees and customers will be curious to see how your purpose informs decision making within your company. Let every decision you make be led by your purpose.
Make room for opportunities.
Ensure to make space for opportunities when your business feels stagnant or unfulfilling. Begin to explore things that call to you and make connections with people who will support you as you make this transition.
Stick with the reasons for your purpose.
Reflect on the reasons you began your business at first. To give to others? For support? Keep your reasons in mind or better still, write them down. You can refer to them whenever you don't feel connected.
“To be truly successful, companies need to have a corporate mission that is bigger than making a profit” Marc Benioff
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