Does Purpose = Profit?
Most companies today are searching for ways to improve employee engagement and retention. The good news is that after over 20 years in industry I’ve learned that there is a very simple solution that solves both issues while also improving the performance of the organization. Read on to learn the secret.
I was speaking to a room full of senior leaders recently and had the chance to take them through a couple of self-reflective exercises around purpose. There was one gentleman in the front who I noticed wasn’t writing much. With each exercise he would write for a few seconds and then look up at me as if to say, “is that all you’ve got?”. I thought to myself, wow, this guy isn’t very interesting in what I’m saying. During a break I had a chance to talk to him and what I learned was inspiring.
He said that the reason he wasn’t writing much was because he had already done much of this self-reflective work. He added that, as a matter of fact, he ensures all of the employees in his company are assimilated by going through a similar experience. They think about how their own personal values align with what the company is focused on achieving.
He went on to pull out his phone and shared an email from an employee where she was thanking him for the experience and said she hopes he doesn’t retire anytime in the next 20 years so she can continue to learn from him. When I saw that, I told him that he is a great leader and we need to figure out a way to make clones of him in companies around the world.
It was then that he made a statement I will never forget. He paused and said, “Well, I see it as my competitive advantage.”
I went back and researched his firm and learned that they are indeed outperforming their competitors in many areas. Clearly this company, and more specifically this leader, is doing something right.
“Companies that do not understand capitalism’s evolving identity - what many are now calling ‘conscious capitalism’ - could have a short life expectancy because the forces driving this makeover are essentially unstoppable.” - Book - Firms of Endearment, by Raj Sisodia, David B. Wolfe, and Jag Sheth
Traditional ways of capitalistic thinking do not support the idea that something like “purpose” can have a measurable impact on business results. It has been thought of as purely philanthropic, or too “soft” or “touchy feely”. The truth is however, that the data says otherwise. There is a growing list of studies and science-based research that support this new reality and there is a huge risk in ignoring them.
76% of young people said they have, or would purchase a product to show support for an issue the brand supported. By 2020 those young people will make up 40% of all customers, not to mention a growing portion of the workforce.
Many companies have been capped in their performance or seen their demise by not recognizing changes in the landscape like these and adjusting accordingly.
So why is this new emphasis on purpose having such an impact? It’s as simple as this:
People are looking for meaning in what they do, not just money. And when they find it, they take inspired action. This kind of action causes them to perform better, and ultimately improves the performance of their company.
It is not just Millennial and Generation Z employees that are looking for meaning. The meaning of life, and specifically the meaning of one’s own life, is a major issue in midlife and beyond, so Generation X and Baby Boomers have this desire as well. Particularly once they reach a certain level of financial comfort.
Inspired Action - The new incentive
Inspired action is the action we take when we are intrinsically motivated and emotionally connected to the task at hand. When inspired action is involved, something very powerful happens. We make surprising new contributions to our organization and we have a greater impact on the people around us.
When we connect to a deeper meaning, and one that is particularly relevant to us, it sparks the intrinsic motivation that breeds inspired action. It triggers two little chemicals in our brain called serotonin and dopamine, which optimize our cognitive ability and gives us that extra boost of energy and creativity to take our efforts to the next level.
So what does inspired action look like?
An introverted product manager that has an idea for a new initiative and decides to get out of their confront zone by reaching out to someone in marketing to initiate a special project
A personal banker going the extra mile with a client by genuinely caring to ask about their family and it turning into a cross-sell that meets a niche need
An engineering manager that decides to use the company planning system to create work plans for the entire team that tracks each individual’s performance for clarity around improvements
Each of these actions happening without being told to do so by their leader is what inspired action looks like. The results are innovation, increased sales, and improved efficiencies.
Employee Engagement - When employees are taking inspired action, they are engaged
In today’s competitive market most companies are focused on finding ways to get employees more engaged and retained for longer. I would offer to make a minor shift in that approach. Instead focus on finding ways to inspire these employees into adding as much value as they can, as quickly as possible.
The beautiful coincidence is that when we are inspired and feel like we are adding value, we are naturally more engaged and more likely to stay with a company. When spread across an organization, this creates an environment that people enjoy being a part of because they are consistently finding meaning while making money.
On the flip side of the equation, how much value is a company missing out on when it doesn’t create an environment of inspired action? Inspired action is a remedy for under-performing teams and people.
What To Do
How meaning is instilled into an organization is important. It’s not just a matter of saying that the company is purpose-driven, mission-driven or corporately responsible and creating a statement to reflect it.
Companies are driven by people, so it’s much more personal than that.
It happens when each employee has been ignited with passion about something they care about that is bigger than them. Note the word, “they”, care about. Just telling employees what the meaning is and expecting them to get on board will not do the trick. There are specific strategies that must be leveraged to effectively make the transition into meaning being a part of the organizational fabric.
The challenge is to help each employee connect their daily activities to what they care most about individually while also connecting it with what the company has determined is the impact it is making on the world. For organizations looking to move in this direction, I recommend these 4 phases.
Have the senior leadership team create a safe space for learning and growth (Growth Mindset).
Create a clear purpose for the organization (if there isn’t one already).
Push the purpose down through the organization by creating a support system of middle management leaders and salaried employees that have an understanding of their individual purpose and how to align it with the company.
Institute a process for continued refreshment of purpose alignment on a periodic basis.
Bringing meaning into an organization’s core strategy is no longer a “nice-to-have”. It has become a business imperative, and the way trends are pointing, will only become more important in years to come. As it turns out, Purpose does indeed = Profit. And not only that, it is literally making both the world and the workplace a better place.
The Good News
Given this information supporting the increase and fortune of purpose-driven, mission-driven, socially responsible, and B-Corp companies, it has never been easier for leaders to understand how to strategically focus their organizations for sustainable success.
If your organization has not made this transition, or has tried but still having difficulty aligning performance with purpose at all levels, it is not your fault. Given that the entire
business education system for leaders and executives since capitalism was born have been rooted in more traditional principles, it is a wonder that the senior leadership of any company is able to consider the transition, let alone figure out how to shift the entire organization. Change is hard, especially when it involves a mindset overhaul such as this.
Never has anyone put this transition into an actionable system that drives business performance based on a simple step-by-step leadership model that any person can learn. At Whitman Consulting we have created such a system that scales purpose to every individual in an organization. We are here to help you make your business the success you need it to be. Email us (contact@consultwhitman.com) now so we can discuss how we do it and start your journey to even more success and status.
About the Author: Andre W. Thornton is the Founder and CEO of Whitman Consulting. Whitman Consulting’s purpose is to change lives by helping leaders reach their full potential through purpose-driven leadership. Andre has over 20 years of experience, including 18 years with Lockheed Martin where he rose to the level of Engineering Director, leading a team of over 2,000 technical professionals. Before departing LM he redesigned a leadership development program for the company. Whitman Consultings’s client list has included Microsoft, SunTrust Bank, EY, Lockheed Martin, SNC-Lavalin, and Teamworks Inc., among others.