Corporate purpose: the what, the why, and the how
More and more companies are starting to see there’s more to business than just making profit. Yes, purpose is growing and we are extremely happy it’s catching on! Because the growing purpose awareness shows that businesses are accepting their responsibility to do their part in solving our world’s biggest problems.
But what is purpose exactly? And why is it so important for businesses these days?
What is purpose?
There are multiple definitions of purpose in the sense of corporate purpose. One of our customers, EY, defines purpose as “an aspirational reason for being that is grounded in humanity, and which inspires a call to action”. Harvard Business Review defines purposes as a way “to inspire your staff to do good work for you, find a way to express the organization’s impact on the lives of customers, clients, students, patients – whomever you’re trying to serve”.
Both definitions focus on both your organisation and the impact you want to make on society. At GoodUp we use the following definition of purpose:
“Where your core skills and expertise make a positive impact on society.”
This definition clearly shows that purpose is different from your mission and vision statement. It’s also bigger than a CSR strategy, and it should definitely not be something your marketing department invented. A successful purpose is incorporated into your overall business strategy and lives throughout the entire company. It explains your bigger why. Like why your organisation exist, why your product matters, or why you chose to provide this product or service?
A good example is our customer DSM. Their overall strategy is that they are a “purpose-led performance-driven company” and their purpose is formulated as “creating brighter lives for all”. By incorporating that purpose into their strategy, they make sure every business decision contributes to their overall purpose.
When purpose is done well, it grows your authenticity, success, and profits. Which leads us to the reason why your business needs a purpose in today’s society.
Why does your business need a purpose?
The time that consumers accept anything you put in front of them is long gone. People are becoming more critical, more aware, and want to know what the big corporations are up to. Especially Generation Z, today’s teenagers who are growing up fast, care about a brand with values. In a recent study over 50% said that knowing a brand is socially conscious positively influences their purchase decisions.
But not only your customers, also other stakeholders are looking for brands with a deeper meaning. More and more people want to work for a cause they care about and even investors are catching on to the fact that businesses with an authentic purpose are doing well financially.
Essentially, all your important stakeholders choose purpose-driven businesses over companies that are solely driven by their own profit. By using purpose as a framework for your business, you can leverage the three core benefits of purpose and make sure people stick with your company.
The business case for purpose is solid. Now, it’s time to act!
Make purpose work for your business
In this blog series, we’ll explore the depths of purpose. What are the benefits for your business, how do you define a corporate purpose, and how can you turn that purpose into a business success? Read on and become a purpose expert yourself!
- The three core benefits of purpose for business (coming soon)
- The difference between your purpose and your mission statement (coming soon)
- How to define your corporate purpose (coming soon)
- 10 companies that successfully put purpose into action (coming soon)
- How to use authenticity to create a successful purpose (coming soon)
- The essential role employees play in your corporate purpose (coming soon)
- The difference between purpose marketing and being purpose driven (coming soon)