Further, in our discussion of PURPOSE, we are going to take a look at corporate purpose. This is the focus of doing big things for the greater good, not revenue, not profits, not stock price. Doing good for humankind. This is where we step out from our internal perspective and look externally. Not always an easy task for most corporations. The first paragraph of this section of Shiftability uses a quote that tells the story. I am personally quite proud of the corporate purpose that Microchip (where I work) has created. Ours is…Empowering innovation that enhances the human experience by delivering smart, connected, and secure technology solutions. It paints the big target and tells HOW we will do it. There are lots of great examples of this, just look around and dig and you will find them…then ask yourself what your corporate purpose is. Don’t have one… maybe you should lead the effort to create one!
OK… LET’s ROLL!
From Shiftability comes……
Understanding Corporate Purpose
Nikos Mourkogiannis argues in his book Purpose: The Starting Point of Great Companies that purpose is crucial to a firm’s success: it is the primary source of achievement and reveals the underlying human dynamics of any human activity:
“Purpose is crucial for all truly successful enterprises. Let others play with ‘strategy’ and ‘tactics’ and ‘management’. Purpose is the game of champions. Only strong-minded men and women – adults with powerful intellects and real character and spines of steel – are suited for it…Purpose is bigger than ambition or greed. Purpose is bigger than strategy. Enron had strategy – indeed it had many strategies. But strategies are about means; they cannot be an end in themselves. An end is a reason. Enron lacked a reason – it lacked Purpose.”
For a company to truly make a difference over a long period of time it must have clear directions by which it makes decisions and views its challenges. Good times and bad times are best guided by a clear understanding of both the company’s values and its true purpose. A purpose that is BIGGER than revenue, bigger than profits, bigger than the return on working capital, and all the other very key metrics of corporate financial success.
However, profits are key to the life of the corporation. One of the Value Statements at Mitch’s company is “Profits provide for everything we do.” If you do not maintain a steadfast focus on creating and delivering profits, whether you are a public company or a privately owned company, the value that you deliver to your clients will simply not survive.
But profits are the outcome of actions, not the driving force. Purpose is built on a higher plane than profitability and it feeds that never-ending hunger for more profits. Defining and focusing on purpose is actually highly profitable.
A truly effective corporate purpose statement should compel the soul to action. It should emotionally touch the humanity in each person such that we clearly know why we are working hard on the behalf of others.
We highlighted Apple’s corporate purpose statement above. Here are some more examples from other companies:
- ING’s purpose is “Empowering people to stay a step ahead in life and in business.”
- The Kellogg food company’s purpose is “Nourishing families so they can flourish and thrive.”
- The insurance company IAG purpose statement says, “We help make your world a safer place.”
All of these statements appeal to our humanity. “Nourishing thriving families” is far more inspirational than increasing our share of the breakfast cereal market would be. And “making the world a safer place” is a far more noble purpose than selling more insurance.
What is the corporate purpose you are working towards?