WHAT’S THE POINT OF PURPOSE?

How Organisational Health Is Boosted by a Clear Purpose

Clear-Purpose

It’s amazing how a crisis sharpens our focus and unifies us behind a common cause. When Allen and Lizette Snaith confronted the potentially devastating damage to their business from Victoria’s Black Saturday bushfires in 2009, they looked at their purpose from a very different perspective.

What had started out as a farming hobby now became their major source of income and, with it, came the realisation that they were in the food, as opposed to agriculture, industry.

This clearly defined and well articulated business purpose has translated into growing sales and a recent Produce Award – the equivalent of a food Oscar – for the Snaith’s company, Warialda Beef.

Whilst it is necessary for CEOs and business owners to devote time and energy to their day-to-day operations, this myopic focus on the daily milieu can often come at the cost of clarity about why a company is in business in the first place.

Why is it so challenging to answer a simple question – why are we in business? – and build a process that articulates this, when during a crisis organisations are able to think very clearly around how to address and manage a disaster situation?

How have the Snaith’s managed to synthesise their business purpose into such a compelling and concise statement – “we are in food, not agriculture” – when some of the biggest industries in the world can’t do the same?

Just think of the classic example of Hollywood, which was hit by a revenue tsunami when it spectacularly failed to realise it was in the entertainment – not movie – business. The same can be said for music labels that didn’t appreciate they were in the content, not artist-management industry, when competitors like iTunes hit the market.

This came home to me in a recent conversation with Grant Chisnall, Managing Director of emergency management specialist, Dynamiq.

As Grant puts it: “From a crisis management point-of-view, a clear and well articulated objective sets the scene for an organisation’s ability to manage people, respond effectively and protect its reputation.

“No matter if you’re the person in the field, or sitting in the boardroom, this strong clear objective is the unifying link from which every behaviour and response hangs.”

Is it possible to drive this strong sense of purpose through companies without needing a crisis to act as the catalyst?

There seem to be two potential barriers to businesses defining and articulating their purpose. The first is the tendency for business owners to become absorbed in the operation of their companies, rather than strategy. And the second is the impact on purpose of changing customer needs and buying behaviour, which demand an agility that many companies struggle to integrate into their businesses.

Working On the Business, Not Just In the Business

I don’t believe the problem lies in business owners and CEOs failing to appreciate how critical purpose is, but instead is about taking a step back from the day-to-day.

The elevation of internal discourse to focus on an organisation’s “why” is a vital ingredient in the development of a high performing culture and teams. From a clear sense of purpose comes guidelines for the company’s behaviour, enunciation of its market position and an understanding of the value it delivers to its customers.

Whilst almost every company has its values front and centre on its website, this is largely meaningless and inauthentic to your staff. For a successful business, which understands and fulfils its purpose, those values have meaning and your people, at both a conscious and unconscious level, know exactly how to behave.

The Market Isn’t Static, and Neither is Your Purpose

When our team at Chase Performance talks to companies about their purpose, 9 out of 10 tell us that they’re in business to make money. It’s important to remember, however, that revenue comes from your customers. If you’re not pleasing your customers, then the simple truth is you will not make money.

Your company purpose not only delivers an understanding of what your market is currently looking for, but also makes you agile enough to respond to market shifts.

According to Grant Chisnall: “We know that it’s a challenge for owners and operators of smaller and medium-sized companies to create the time and space they need to build a process around purpose, engagement, review and acknowledgement of successes.

“But what we’re also now seeing is a shift in larger organisations, particularly in the mining, energy and resources sector which has come off the back of large and rapid growth.

“These companies are now transitioning from the project phase into production phase, leading to leaner teams, leaner decision-making and a leaner span of control. Therefore, their people are more nimble and able to adapt to the changing market environment.

“I think, in many ways, we are observing larger enterprises borrowing from SMBs which are undoubtedly challenged, but which also are traditionally nimble, resilient and have the capacity to roll with the punches.”

Singing from the Same Song Sheet

When I look specifically at purpose and how it contributes to organisational health, I am always brought back to the fact that it is THE unifying element for your people.

Whilst we can all look at traditional motivational levers to try and get our teams singing from the same song sheet, we need to acknowledge that bonuses, carrots and sticks, and sheer force of will simply aren’t effective.

Without a clear reason for doing what we do, nobody will remain motivated or interested in the final outcome.

Daniel Pink in his book Drive: The Surprising Truth About What Motivates Us, describes three critical motivators:
  1. Autonomy
  2. Mastery; and
  3. Purpose.
The issue for most businesses is that, although they have a business plan, it’s not a living document. People simply don’t understand the plan, making it almost impossible to engage with them. Motivated teams have a say in their own destiny, gain self respect from mastering new skills, and have a strong sense of purpose about why they do what they do.

Purpose plays a clear role in ensuring teams are working on projects that are aligned to the business plan. In this way, your company purpose is believable and your values are credible.

According to Grant from Dynamiq, if you’ve got teams all singing from the same song sheet, then you have the basis for high performance teams. People understand the purpose of the organisation, and can communicate its value both internally and externally. In this environment, purpose is both the unifying element for teams, and provides the opportunity for challenging discussions relating back to that purpose.

In Grant’s opinion, if the business is either diverting from, or excelling towards, that line then high performance teams will challenge the group and challenge the group’s performance.

Enablers for Behaving with Purpose

Grant has identified four enablers for organisations that strive to behave with purpose:
  1. Time and space  - Business leaders and their frontline teams need a framework for the definition and articulation of their business purpose, and a routine that creates the time and space to focus on it.
  2. Communications channels – This process addresses how you capture positive lessons as well as lessons where you haven’t succeeded, and transfer them across the business. It builds engagement, review and acknowledgement into the fibre of the business.
  3. Team structure – Teams require clarity on their roles and responsibilities. Within the team structure should be an acknowledgement of both formal and informal roles, and opportunities for each member to have their say.
  4. Trust – The ability to have conversations about purpose within an organisation is founded on trust in each other and in the business. Trust is the key that binds teams together. People have to know they will be heard, and that they will see positive action as a result.
I’ll leave the final word on organisational purpose to Grant, who defines its potential impact very eloquently:
“When businesses are faced with a crisis situation, there is suddenly a great deal of focus around a specific objective. If you could bottle that and retain the clear-minded focus, drive, commitment, purpose and intent, your business would be unstoppable.”