Finding Your Organizational Purpose

Purpose cannot be effective when employees feel distanced from it, and that purpose does not touch their daily lives. Purpose is not merely a corporate tool or marketing strategy (although it can be, when deployed appropriately); purpose is lived experience.

Why is a sense of purpose so strongly linked to business success?

Organizational purpose is hardly new to the public discourse— purpose is aspirational and provides, in theory at least, a north star by which businesses can guide themselves. A strongly stated and intentionally cultivated purpose gives your brand integrity and your customers something to rally behind and identify with.

As increasingly aware customers find themselves in “a trust deficit”, purpose becomes a key differentiator in the value wars. Millennials and Gen-Z, in particular —where purchasing power is increasingly consolidated— are deeply aware of social inequities and climate and political crises and have shown an inclination to vote with their wallets. As activist movements educate the consumer further, consumers and brands are both held up to increasingly regulatory and public scrutiny. When articulated correctly, a clearly defined purpose and plan for positive impact helps brand and customer identities dovetail, resulting in a lasting affinity and loyalty advantage for the brand that can be hard to shake.

Note, however, that brand purpose cannot be reduced to mere lip-service— the 2022 customer is extremely well-equipped to sniff out inauthenticity. Social media, in particular, has amplified the consumer voice, and often, provides a parallel (and to other customers), a more trustworthy, unbiased alternative to the brand-authored narrative. In other words, if you’re lying about living out your purpose, your customers will find out, and they’ll tell all their friends. In a world where reputation is king and referrals are key to building trust in your brand, this is not a consequence you want to contend with.

At an organizational level, purpose also helps build teams that are aligned and engaged in the long-term. Teams that are motivated purely, or even mostly, by extrinsic factors will never be as motivated as teams that believe in what they’re doing— which is not to claim that extrinsic factors are not essential to team success! In today’s competitive landscape, workers absolutely need to be well-compensated (both as a matter of principle, and to retain key talent). But, in the long-term, as you navigate inevitable disruption and optimize your team to innovate for growth, your purpose forms the guiding principle for your strategy (talent, expansion, pricing, you name it) and without one, you risk both losing your customers and your path forward.


Why do employees consider company culture increasingly important?

Purpose, as outlined in the previous answer, is hardly unique to the consumer — employees are equally motivated by purpose. Extrinsic motivation, such as financial compensation and other tangible perks, are essential, but do not provide meaningful fulfilment in the long-term.  

Take, for example, the Great Resignation, following the pandemic. As employees found themselves in untenable situations where mental and emotional wellness were compromised, they realized that the benefits of higher compensation may not be enough to offset the long-term costs of mental exhaustion and/ or burnout.

‘Burnout’, in particular, has received a lot of attention in recent years— in combination with increasing public focus and education on mental health, employees are now deeply cognizant of the ways in which bad organizational culture and workplace stressors impact them in the long-term. Simply put, there may not be enough money to offset those impacts for many workers (and note that, if those impacts persist, performance is likely to be impacted, lowering financial compensation anyway).

Employees thus find themselves intentionally seeking out workplaces that are aligned with their values, and will provide a culture that allows them to thrive emotionally as well as financially. The risks of not doing so are simply too great— you cannot out-perform chronic fatigue, disinterest or worse, regardless of how much money you’re making for now.

 

What are the most effective ways for a company to communicate its purpose?

Companies need to imbue their purpose into every aspect of organizational strategy. To do this effectively, you must first define your purpose clearly and then communicate that vision downstream to every level— every member of the organization must be aligned on what living this purpose looks like. What are the values that are congruent with this purpose? What does an organization that lives and breathes this purpose look like? What goals are congruent with this purpose? What kind of thinking must a leader embed into the organization to fulfil this purpose? Where does the organizational purpose and your purpose overlap?

Organizational purposes are not meant to live on “Mission” pages of websites or on annual reports— at TPG, we work to bring employees together regularly to revisit purpose, gather honest and constructive feedback on how we are adhering to our north star, and chart a purpose-oriented collaborative path forward. That shared ownership of the path is so effective—where feasible, this democratic process motivates every employee, giving them ownership and accountability moving forward. Note, of course, that these discussions are only possible in workplaces that prioritize and zealously safeguard psychological safety, and open, honest and direct communication across levels. Without mutual safety and respect, there can be no collaborative ownership of purpose.

Once this purpose sinks into the organization’s DNA, it should show up automatically in every facet of organizational strategy— from purpose-driven talent strategies to growth plans to treatment of customers and outbound marketing communications.

Pitfalls arise when leaders have no purpose (beyond financial profit or increased market share), pick a purpose at random to check a box or do not live out their purpose. As discussed above, if employees feel distanced from an organization’s purpose or leadership only touts their purpose in canned corporate communications, companies risk losing both credibility and all the benefits of a purpose-driven workforce (more motivation, better life outcomes, improved and sustained performance).


Many companies believe that purpose is important, but several say their stated purpose has few effects. How can they bridge that gap?

Purpose cannot be effective when employees feel distanced from it, and that purpose does not touch their daily lives. Purpose is not a corporate tool or marketing strategy (although it can be, when deployed appropriately); purpose is lived experience.

Centering purpose in the workplace is essential. Employers often give in to a well-meaning but ultimately misguided impulse to outsource purpose. These employers encourage their employees to find purpose solely at external organizations, and are willing to support them as they do so. However, this strategy does not bridge the purpose-action gap that demotivates employees on a sustained basis; nor does it help them find meaning in the workplace. In order to reap the benefits of purpose, employers have to find a way to deliver purpose within the context of the employee’s daily work, and trust that, as personal and organizational purpose dovetails, both company and employee will benefit mutually. (Talent strategy is particularly helpful here— hiring individuals already aligned with the organization’s core values can naturally streamline the process).

Regular group town-halls and other avenues of meaningful dialogue can be essential in helping employees find alignment with the organization’s purpose and see the impact of their daily projects on the overall vision­–as long as leadership is vulnerable, forthright and welcoming of reciprocal vulnerability. As employees begin to see their feedback in action consistently, they will find a new sense of ownership and motivation that propels them to their best lives and best performance ever

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