As the purpose movement goes mainstream, the pressure for organizations to deliver on their purpose is high. An effective organizational purpose acts as the strategic North Star for the organization.
It defines how you make a difference to your customers and the world. Yet too often purpose gets slapped onto a T-shirt and relegated to HR or social responsibility teams and fails to deliver the financial return that copious amounts of research have shown is possible.
After a decade of working in the purpose space, helping more than 200 firms, I’ve observed three mistakes that stymie even the most well-intended purpose efforts.
1. A lack of clear metrics
Organizations have metrics for production targets, sales revenue, customer satisfaction, and other key areas. Purpose requires similar focus. Those who are serious about it need to add qualitative indicators to measure progress instead of relying solely on traditional, more lagging quantitative metrics such as revenue and profit.
“The first metric is to have a clearly stated purpose,” Bank of America CEO Brian Moynihan said during a recent World Economic Forum panel. Once you’ve established clarity of purpose, you can identify metrics specific to your aspiration.
Other ways to measure purpose could be the number of warm referrals you get, client adoption rates, and direct customer feedback. Identifying one simple metric, even if it’s an imperfect measure, will help keep your purpose at the center of daily operations.
2. Failure to infuse purpose into the sales function
When the pressure to hit revenue targets intensifies, a high-minded purpose often falls by the wayside. This is a costly (and unnecessary) misstep. Activating purpose in sales can deliver the most immediate and widespread financial benefit. Research from Michigan State University revealed that salespeople with a sense of purpose beyond money put forth more effort over time and are more adaptable than salespeople focused solely on internal targets and quotas.
Infusing purpose into a sales team requires leaders to make delivering on the organizational purpose as clear and present as looming financial targets. You can bring purpose to the fore by telling stories at sales meetings about how your organization makes a difference to customers. At my client Atlantic Capital Bank, the president of corporate financial services, Kurt Shreiner, recalibrated his sales team by changing the structure of his weekly meetings. He says, “Now we start with our noble purpose (‘We fuel prosperity’) and then drive the rest of the meeting toward client impact.”
You can also infuse purpose into sales contests by saying, “Our sales numbers are a measure of how we are making a difference to our customers.” Talk about how many customers salespeople helped instead of just the number of deals they won. This simple reframing changes the narrative. It makes clear to your sales team: When we live our purpose, we hit our sales targets.
3. Missing the opportunity to activate purpose in your employees
It’s tempting to think of purpose as a corporate communication that cascades down. But leaders must go beyond messaging to activate purpose in the hearts and minds of their teams. EY CEO Carmine Di Sibio notes, “We have ingrained our purpose (‘Build a better working world’) into what every individual is doing on a day-to-day basis.” For example, an auditor can look at his or her daily tasks and identify how each one makes the working world better.
You can do the same with your team. Ask your people: How does our work make a difference? How do we positively impact our clients, our team, and our community? What role do you play in delivering on our purpose?
The financial benefits of purpose have been well documented. Purpose can help create a stronger brand, establish greater competitive differentiation, and attract top talent. But purpose is valuable only when it’s real. Use the suggestions above to go beyond the tagline and truly bring your purpose to life.