When people hear the word “purpose” in a business environment, a common reaction is that it’s a good thing to include on the company website or in a brochure, but it won’t have any meaningful impact on results. I’ve heard numerous executives tell me that purpose might work in a non-profit organization, but not when your goal is to make money.
But the two are not mutually exclusive. In fact, some of the most purpose-driven organizations have been some of the most financially successful ones.
In 1985, Steve Jobs was fired from Apple and the business quickly began to lose its purpose, focusing only on margins and not in bringing world-changing technology to the masses. When Jobs returned to Apple twelve years later, the company’s revenue had shrunk by nearly 30% from the prior year, with an operating loss of $1 billion.
Jobs then re-shifted the attention of the business from a profit-centric model to one fixated on designing products that people will fall in love with. He brought the business back to its purpose and made Apple one of the most successful companies of the 21st Century, all while changing the world.
Microsoft didn’t have a mission of becoming one of the most highly-valued businesses in the world in their early years. In fact, there wasn’t even a mention of software, which is what created their success. They had a purpose of placing “A computer on every desk and in every home.” Today, Microsoft remains one of the most valuable companies in the world.
The global consultancy giant EY believes that their purpose, “To make a Better World”, has helped them better engage with clients, attract and retain people, experience record-high employee-engagement scores, realize growth across all services, and elevate their brand.
There’s a reason why purpose-driven organizations are some of the most successful. Why these businesses place purpose at the center of their organizations. Why their purpose serves as a guidepost for the behaviors and actions of their people.
It’s because purpose-driven leadership delivers results, time and time again. These leaders don’t just have an eloquent statement of purpose adorning their corporate headquarters. They embed a culture aligned with that purpose so that it becomes part of the organization’s DNA.
In a recent study of nearly 1,500 business leaders from a wide range of industries around the world, it was found that 97% of companies with a highly integrated purpose experienced strong incremental value from their purpose. For those with a moderately-integrated purpose, only 56% achieve the same level of success.
So why are purpose-driven leaders so successful? They place purpose at the center of their organizations because they recognize the value that it brings:
Purpose enhances brand value.
Purpose creates focus for employees on common goals and objectives. When employees and leaders are united in their purpose, they are one. They are stronger and consistently deliver results above and beyond expectations.
Purpose creates a connection between common stakeholders and attracts people toward the organization.
Energy levels are heightened because people work harder when aligned toward a shared purpose.
Productivity and creativity accelerate when those energy levels are elevated.
Purpose helps companies navigate today’s highly dynamic and volatile world.