When you consider your company’s Core Purpose, what comes to mind?
If these are the first things that pop into your head, you haven’t yet understood the power of your company’s Core Purpose.
Core Purpose Can Lead to Profit
Studies by the Harvard Business Review show that purpose can lead to profit and by Stengal that a company’s “Purpose” can increase returns by 400 percent!
The Stengal 50, a list of 50 of the world’s fastest-growing brands, revealed a cause/effect when a brand served a higher purpose and its financial performance. Investment in these 50 companies over the decade of the study would have been 400% more profitable than an investment in the S&P 500.
What is a Company’s Core Purpose and How is it Important?
A company’s Core Purpose is often called its Mission.
One way to begin thinking about your Core Purpose is to consider what would be absent if your company was no longer around. For example:
And perhaps my favourite:
You can’t state a strategy more simply!
Grieve Septic & Liquid Waste is very clear on the words it wants to own in the minds of its core customers.
Core Purpose can get companies through challenging times. When leaders and employees can pause and reflect on the higher purpose their work is serving, it can motivate them to stay the course.
Cars and Shoes: Serving a Purpose
A Bloomberg Business article “The Happiest Man in Detroit” recounts how Alan Mullaly, Ford Motors CEO, led the company from the brink of bankruptcy to being profitable again.
Mullaly drew strength and inspiration from a Ford advertisement published in 1925: “Opening the Highways to all Mankind.”
This was the basis for Ford’s purpose to bring “safe and efficient transportation to EVERYONE.”
He felt the purpose of his business is to improve lives.
Core Purpose streamlines priorities and keeps your company focused!
What’s Your Reason for Jumping Out of Bed in the Morning?
According to a Deloitte survey, 87% of executives believe that companies perform best if their purpose goes beyond profit.
People need a purpose besides “making money” to jump out of bed each morning and head into work.
Deloitte found that if you ignite and capture your team’s hearts with a purpose, not just their heads, they will give you 40% more effort.
How Do You Define Your Company’s Core Purpose?
First, follow the advice of Simon Sinek, author of Start with Why – How Great Leaders Inspire Everyone to Take Action.
Start with “Why.”
Tune into Simon’s TED Talk on the subject (a must watch), then answer these “Why” questions for your company:
Keep asking “why” when you answer these questions and you will end up with your company’s Core Purpose.
And it’s OK, and likely better, if your company’s Core Purpose goes beyond the products and services you deliver.
A Core Purpose should be broad enough to engage everyone in the organisation, and powerful enough to get your lowest paid worker out of bed on even the coldest winter morning.
Even if your company has been around for a while and has established a Core Purpose, you can reinvent it or modify it.
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