Knowing your organisational purpose changes everything. Once you can clearly define why you do what you do, the practicalities of how become much more apparent.
The definition of purpose in a business sense is often confusing. Does being a purpose driven organisation mean that profits must be sacrificed? Is purpose just corporate social responsibility re-packaged for the 2020’s?
Having a strong sense of purpose is likely to increase business performance rather than hinder it. Purpose and profits can co-exist quite happily. As for CSR, this is often seen as a way for a business to offset problems with core operations, something quite different to genuine purpose.
My favourite definition is that purpose is about saying ‘why are we here as a business?’ It sits above. It is a higher reason. At its core, purpose brings a sense of meaning to an organisation. The guiding light when answering the big strategic and operational questions.
A while ago I was recommended the book Doughnut Economics by Kate Raworth. It outlines a theory of economics where you have what looks like a doughnut. On the inside of the doughnut is the social side of things: so, providing an economy where people can have a good standard of living, including everyone in the world. On the outside you’ve got the planetary boundaries, so it’s an economy which lives within the planetary limits. This helped me frame my business purpose and set me on a path to explore B Corporations and building charitable giving into multiple aspects of our business.
It is very important that purpose is genuine and not just a tick box exercise or a means to an end. If there is real purpose in an organisation it will be hugely powerful. If there is a disconnect then it will not resonate and have detrimental outcomes. Purpose will impact all areas of an organisation. The 3 big ones not related to hiring are: To increase and maintain legitimacy, to foster stronger business relationships, and to increase business performance. In my opinion it is no exaggeration to say that organisations are the sum of their people. Those people are looking to be encouraged, inspired, happy, and feel like they are working towards a goal. Purpose meets all those needs.
When it comes to successful hiring there are three main elements to consider: attraction, motivation, and retention. A strong and genuine purpose will allow an organisation to stand out and differentiate. I have seen it time and time again. Good companies miss out on the best people when they are bland or lacking in differentiation. This has never been truer than now with generation Y and Z making employment choices based on principals that may seem alien to their older counterparts.
I’ve worked for professional services firms and for some banks. They are all realising that, with young talent they want purpose. Why? Because they want meaning in their lives. They want to work for an organisation that’s got a sense of meaning. And people are beginning to get that.
Geoff McDonald, Former Global Vice President of Human Resources, Unilever
Once the recruitment phase is over the real work begins. How do you motivate your new star employee? Having a deeply embedded purpose will mean even transactional tasks have meaning. At Headway we have built this meaning into everyday duties in a very tangible way. Through our association with B1G1 we align our everyday business activities with our vision to promote sustainable economic growth and productive employment for all. For example, every client that completes our fact-finding document we will donate a day of sustainable agriculture training for a third world farmer.
Purpose also means that individuals are less likely to leave an organisation. This is the real gold when it comes to purpose and hiring. On average the cost to employers of replacing a single member of staff is more than £30,000. An employee who values the meaning in their work will be reluctant to leave for a company that does not offer the same level of meaning (often even if the salary offered is significantly higher). Combining employee motivation and commitment to the organisation is a powerful anchor.
Authentically pursuing an organisational purpose should be more than just a recruitment hack. It should be the guiding principal which shapes the decisions made within the business. Far from being a constraint, having a strong purpose should free everyone in the organisation to have the autonomy to make decisions, knowing they are guided by purpose. Once you have purpose in place it is your responsibility to use it to attract, develop and retain people who share your vision. This will ultimately create a virtuous cycle which will continually allow you to employ the best talent in your industry and make your mark on the world. In the words of William Clement Stone:
Definiteness of purpose is the starting point of all achievement.
 The analysis by ACAS was based on figures drawn from five different sectors: retail, legal, accountancy, advertising, and IT and technology. Over a year, the report said the total costs for the sectors combined would amount to £4.13 billion.