Estimated reading time: 4 minutes

It’s Only Common Sense: What is Your Company’s Purpose?

What is your purpose? Have you ever been asked that question? We all talk about our company’s mission, but we seldom, if ever, talk about our purpose.

If this if the first time you are hearing the question, I predict that it will not be the last.

Before you answer the question about your company’s purpose, think about what the idea means when it comes to your company and organization. In his book titled Leading with Purpose, Richard Ellsworth says:

“Corporate purpose is at the confluence of strategy and values. It expresses the company’s fundamental-the raison d’etre or overriding reason for existing. It is the end to which strategy is directed.” ^[1]

And from the new book Red Goldfish, author Stan Phelps writes:

“Purpose is becoming the new black. It is emerging as a guiding light that can help businesses navigate and thrive in the 21^st century. Purpose is an aspirational reason for being, that is grounded in humanity, is at the core of how many companies are responding to the business and societal challenges of today.” ^[2]

Here is my take on this: When you talk about purpose you are talking about the reason why you are in business, and why your company is in business. Think back to when you started—why did you start your business way back then?

Every single company was started to fill a need. Somebody at some time saw a need and set out to provide that need. That is and has always been the basic reason for any business to start.

Now, as you think back, what was that need? Is your company still filling that basic need today?  Is your company still doing what it was founded to do in the first place?

Focusing on your company’s true and basic purpose is the very best way to find your direction if you have lost it. It is the perfect way to realign your company if it has come out of alignment or to keep it in alignment at all times.

Ten Benefits of Knowing Your Purpose

In Red Goldfish, the authors list 10 benefits your company will reap when you put purpose at the core of your business:

1. Purpose instills clarity.
2. Purpose guides both short-term decisions and long-term strategy at every level of an organization, encouraging leaders to think about systems holistically.
3. Purpose guides choices about what not to do as well as what to do.
4. Purpose channels innovation.
5. Purpose is a force for and a response to transformation.
6. Purpose motivates people through meaning, not fear. It clarifies the long-term outcome, so people understand the need for change rather than feeling it is imposed upon them.
7. Purpose is also a response to societal pressures on business to transform, to address global challenges, and to take a long-term, more comprehensive approach for growth and value.
8. Purpose taps a universal need to contribute, to feel a part of society.
9. Purpose recognizes differences and diversity. Purpose builds bridges.
10. Purpose helps individuals/teams work across silos to pursue a single compelling aim.

Now, let’s take a look at the differences between an organization’s mission and its purpose. Mission is always talking about where we want to go, it focuses on where we want to be someday.

Conversely, purpose is the company’s very reason for its existence. It is the reason that there is a company or organization. The purpose of your company actually defines the company to the point where it is the very foundation on which your company has been built.

Whether your company is a PCB shop, a car repair shop, or a head shop, it is around because it serves a purpose. A clear and well-defined purpose will help you not only attract the best people with the same passion for the same purpose, but it will keep them passionate and engaged for years to come.

Your customers do business with companies with which they share values. If a company’s values mesh with yours, they will buy from you. If they have the same purpose for being, they will buy from you, and most of all, if they are passionate about the same thing, they will buy from you.

So, I ask you again: What is your company’s purpose? Why are you in business in the first place? And probably the most important question: Is the purpose for your company the same today as it was when the company was started years ago.

Finally, is your company’s purpose obvious? Does everyone in your company—and I mean everyone— know why you are in business?  

It’s only common sense.

References

1. Leading with Purpose: The New Corporate Realities, Richard Ellsworth, 2002.
2. Red Goldfish: How Promotional Products Leverage Purpose to Increase Impact, Stan Phelps and Roger Burnett, 2020.

Dan Beaulieu is president of D.B. Management Group.