Unlock the Power of Purpose

Companies that have defined a values-based core purpose for their existence and pursue strategies aligned with that raison d’être can gain many advantages: greater focus, more engaged employees, more loyal customers, and better financial performance.1

It’s no wonder that developing a purpose statement is now on many business leaders’ agendas — especially as employees increasingly question their organization’s impact on communities and the planet.2 But if companies do little else with the statement than post it on their website, there’s little likelihood that it will confer much benefit.

Purpose is not a lever that can be pulled; rather, as our research has confirmed, it exerts its power as a deeply held commitment that is shared throughout an organization and motivates action. The identity of the organization, its role, and the reasons why that role is meaningful and valuable all flow from that shared commitment.3 Purpose makes a difference in organizations only when it changes the way people operate.4

For purpose to have a transforming and lasting impact, leaders need a deliberate, sustained approach to identifying, operationalizing, and measuring it. Our earlier research identified a set of key elements for defining and developing a solid purpose. We have subsequently developed a set of processes we call the Purpose Strength Framework. (See the “Purpose Strength Framework.”) Here, we’ll explain how companies can use it to turn intention into consistent action that yields the benefits of being a purpose-driven organization.

How Purpose Gets Its Power

The power of purpose comes from its capacity to link people through a shared belief about the identity, meaning, and mission of the organization.5

Purpose inspires people by illuminating the priorities of an organization that most naturally flow from its identity: its history, why it exists, and its ultimate aim. It creates a sense of meaning by connecting the work people do with their feelings and values so that they will act from the heart. And it helps to clarify how the organization contributes to each stakeholder. In these ways, purpose guides the daily actions of people within a company.

Shared belief in identity, meaning, and mission derives from a purpose that is authentic, coherent, and has integrity.6 To be authentic, it must express what people in the organization feel is important. It is coherent if it is consistent with the work that the organization performs day to day. Integrity springs from meeting the first two conditions, and from the company staying true to its purpose even when it hurts the bottom line. Our research has found that when all three criteria are present, employees are twice as likely to go beyond the call of duty and do things for customers, colleagues, and their organization that are not strictly required by their jobs.7

We worked with a European consumer electronics retailer whose purpose was conveyed with a clear, simple message — “Do right by the customer” — that encouraged employees to use their judgment when providing service. This implicit autonomy let every salesperson see customer interactions as opportunities to create their own legacy of great customer service. Employees were constantly reminded to define service from the customer’s perspective, ask customers questions about their specific needs and preferences, and go beyond expectations. The purpose was one that employees could understand, identify with, and contribute to.

An effective purpose also must be dynamic. Leaders need to stop from time to time and ask, “How are we living our purpose? How can we do it better?” When everyone in the company contributes to these reflections, the purpose can become even more powerful and more deeply shared by employees, because it integrates their views.

As with any major initiative, implementing purpose requires the full commitment of top management. Purpose can have an impact only if senior leaders thoroughly embrace it and are prepared to make changes in how the company conducts itself to align its daily operations toward the purpose.

That purpose must also align with the company’s strategy. The organization might define its purpose and then develop a strategy that flows from this purpose, or it might start with a strategy and assess its strategic initiatives through the lens of its purpose. Either way, a successful purpose implementation process requires a purpose-based business strategy that makes explicit the proposed shared value that stakeholders and the company will derive.8

When senior management is on board and leaders have established a clear connection between the company’s purpose and its business strategy, they can begin to incorporate the purpose into operations. Doing so relies on three processes: purpose knowledge, purpose internalization, and purpose contribution.

Know Your Purpose

Before employees can work toward the company purpose, they need to understand what it is and how it connects to business strategy, and be able to explain it in their own words. Managers across the organization help to develop purpose knowledge by clarifying for their teams how business decisions are made based on the corporate purpose. Leaders should constantly look for opportunities to communicate purpose and manifest it in the organization, making purpose visible to ensure that it’s expressed explicitly and informally in daily conversations. The goal is for people to feel the presence of purpose in everything they do and see around them.

The medical equipment company Vygon renovated its facilities in Spain to reflect the company’s purpose: to value life. Business leaders aimed to convey two essential aspects of this purpose: that its people take care of one another, and that they can express optimism about their work. Although the company wanted all stakeholders who came through the company’s doors to understand its purpose, the design of the facility, dubbed the “optimistic building,” put employees first by creating a work environment that would make people feel at ease. Every space was designed to manifest the company purpose so that employees themselves can experience it.

Connect Purpose With Employees’ Values

It is not enough for just leaders and managers to know how their work contributes to the company purpose. Through the process of purpose internalization, every employee becomes empowered to connect the purpose of the organization with their individual values. Purpose internalization is accomplished through explicit processes that help employees connect the company purpose to their own values.

For example, workplace services company ISS uses a program called Find Your Apple that helps its approximately 500,000 employees discover how their purpose relates to the company’s. The Danish multinational offers cleaning, catering, and maintenance services; its purpose is “connecting people and places to make the world work better.” One participant in the program, a patient porter in a hospital, came away with this personal purpose: “I give patients that extra push on their way to recovery.” He further specified that he “treats patients with respect and dignity while transporting them safely … establishing a welcoming environment and accommodating the many international patients in a warm and hospitable way.” The porter’s personal purpose not only connects concretely and explicitly with ISS’s purpose but also guides his decisions and energizes him.

Efforts like these to internalize purpose can give meaning to daily work as well as increase employee engagement, commitment, and loyalty. And when employees can find meaning for themselves, they enhance the experiences of customers and other external stakeholders. Furthermore, as people take individual responsibility for realizing the company’s purpose because they believe it is worth achieving, they demonstrate leadership that influences their colleagues in positive ways.

To enable employees to make these connections, however, leaders must build a climate of healthy, authentic interpersonal relationships in which people feel safe to reflect on the ways that the values of the organization coincide with their personal values.9 Throughout the process, individuals need to be able to speak their concerns and ask questions while trusting that their colleagues and managers will not reject them for doing so.

Measure What Purpose Contributes

The final process for implementing purpose, purpose contribution, ensures that the corporate purpose is reflected in the organization’s operations. This process looks both backward, by measuring how a company has fulfilled its purpose in the past, and forward, by identifying what actions the company can take to continue to do so.

A company might use a purpose scorecard as a way to show how it is performing against metrics that measure how it has contributed to its purpose.10 While some existing key performance indicators may serve as useful metrics, business leaders might need to create new ones to track outcomes that have not previously been measured. For example, plastics manufacturer Elix Polymers developed a purpose scorecard that shows each department’s progress toward the company’s shared mission. (See “Tracking Purpose Impact.”) The use of a purpose scorecard in this way can help middle managers connect their key metrics to purpose, resulting in higher employee identification with and contributions to the company.

When imagining the future, business leaders will want to consider whether the company’s management systems and processes help or hinder it in achieving its purpose. When these elements are misaligned, the company is two-faced: Its publicly stated purpose does not match what employees experience. When they are aligned, however, they provide clarity, generate trust, and reinforce leadership authenticity.

For example, companies often need to adapt their people-management systems to achieve a meaningful connection between what employees do and the company’s purpose. The Valencia, Spain, technology center Ainia realized that it needed to adjust its hiring, onboarding, appraisal assessments, and compensation packages in order to deliver consistent messages to employees about how they would be evaluated and rewarded for contributing to the corporate purpose. Among the changes, Ainia shifted from a compensation system that rewarded employees primarily for generating revenue to one that focused more heavily on certain indicators of performance related to its purpose, such as social return on investment or customer satisfaction. Had Ainia continued with the prior compensation model, employees would have felt little incentive to work toward the purpose.

When an organization has set in motion the three processes of purpose knowledge, purpose internalization, and purpose contribution, it has turned on the machinery of purpose implementation. Once this machinery is up and running, it needs to be oiled regularly to ensure continued consistency between what the purpose says and what people in the company do.

Communication serves as a vital lubricant, linking the organization’s internal identity to its external actions. A company owes much of its success with purpose to how well it communicates its internal identity and how what it does in practice manifests its purpose. When the three purpose implementation processes are in place, connecting every aspect of the organization through purpose can be constantly renewed through well-tuned communication.

It’s also important to periodically assess the current reality of the organization to evaluate the intensity of purpose in the culture. Pulse surveys can gauge how much employees connect their work with the purpose. Leaders should also look for signs of purpose intensity, such as high levels of individual commitment and collective unity as evidenced by productive collaboration.

Both of these approaches should lead to improvements in measures of organizational performance, such as financial results or employee retention statistics. When individuals and teams see their daily work as contributing to purpose, and purpose-aligned strategies deliver objective business results, leaders will know they have unlocked the power of purpose.