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Multiple studies show that Purpose can transform your business performance – but only if you activate Purpose authentically.

It’s a new financial year for many organisations. Time to take stock and think about the big, longer-term ambitions for the next twelve months and beyond. One such topic in many Boardroom discussions these days is Purpose. Which is not surprising given that study after study shows the quantified potential of Purpose to transform organisational performance from average to outstanding.

For example:

  • A 2016 Korn Ferry study that showed Purpose-focused organisations have growth rates three times the average for their sector
  • A 2017 Havas Media Meaningful Brands study showed that meaningful brands have outperformed the stock market by 206% over the last 10 years
  • Unilever has reported that its brands with a consumer-recognised Purpose are growing 50% faster than those without and are delivering 70% of their total growth
  • Whilst Gallup’s global employee engagement study shows that only 13% of employees worldwide are actively engaged at work, a 2016 study from Deloitte showed that 73% of employees who work at a Purpose-driven company feel engaged

Organisations and brands with clear purpose benefit from extraordinary levels of engagement from an inspired and energised group of followers (employees, consumers and other relevant partners). In short, a “community of believers”.

As a result, they build relationships that generate premium margins and achieve growth rates well above category norms. Scratch below the surface of any great brand and organisation and you will find a strong purpose at their heart. It’s what separates innovative category champions from lower-priced shelf fillers.

The bottom line is that Purpose, done well, drives performance.

But before you fire off an email to your comms agency instructing them to “find me a Purpose”, there is an important caveat: you will only realise the performance benefits by activating Purpose authentically.

That means an authentic commitment to action, linked closely to your core products and services. And with an activation approach that allows high levels of participation from fellow ‘believers’, both employees and external supporters. The design principle for Purpose is very straightforward: to maximise the scale of impact that you can make, you want as many people engaged in as many actions as possible. Effective Purpose is a movement for change.

Unfortunately too many brands and organisations miss these vital ingredients when developing and activating their Purpose. Instead they choose the ‘easy’ route. They brief their comms agency to produce an emotive ad, linked to a social cause du jour, to prove how purposeful and caring they are. To give it a hint of credibility, they brief their PR agency to find a suitable charity partner and initiative to support. Some might go as far as offering 5p per pack purchased to make it look like a real commitment.

The bottom line is that this is tokenism. It’s not Purpose, It’s a CSR veneer to make you feel and look better: empty virtue signalling.

It is interesting to observe the debate the raged around the recent US Gillette ad and its stance on toxic masculinity. Personally, I think it is fantastic that a brand is being brave enough to take a clear and strong stance on an important societal issue – as opposed to the safe, bland, category-generic propositions that so many others opt for (ever wondered why the Havas Meaningful Brands study highlighted that globally 74% of brands could disappear and consumers would not care?).

Whilst there are undoubtedly a few glaring mistakes in how Gillette executed the idea, the fundamental issue for me is that the authenticity of their commitment was questioned. The brand positively contributed to raising awareness and driving debate in the short-term. Yet, beyond this, whilst the $1m donation per year for 3 years to NGOs who will help men develop better social and emotional skills is undoubtedly a positive contribution to the issue, it feels like the easy option.

This becomes especially noticeable when you read the blurb on the brand’s website around the new campaign:

“From today on, we pledge to actively challenge the stereotypes and expectations of what it means to be a man everywhere you see Gillette. In the ads we run, the images we publish to social media, the words we choose, and so much more”

The fact that their actions suggest a focus on comms initiatives as opposed to detailed, on-the-ground action is telling.

My fear is that it’s a short-term tie-up, based around a burst of advertising media, designed to make an organisation or brand seem vaguely more caring, interesting and culturally relevant. And it quickly gets forgotten as employees rush to get back to their day-to-day business (and true primary purpose) - selling stuff to make money.

Don’t get me wrong. I’m not advocating businesses become bleeding heart charities. I’m talking hard-nosed business performance (just check out the facts shared previously). But this will only come from organisations properly embedding Purpose at the heart of what they do and who they are. Authentic Purpose operates from the core, not the periphery.

There is a focus on action, with products, services, platforms and programmes combining to act as change drivers. And organisational culture, structure and processes designed to empower and enable employees to passionately contribute to delivering the Purpose.

That requires vision and leadership: the kind that drives the likes of Nike, Ben & Jerry’s, Southwest Airlines and Patagonia. These are all organisations with a powerful Purpose that is embedded deeply across their whole business and that inspire passionate engagement and action from employees and consumers alike.

They have a powerful Purpose because it combines the right idea, the right conditions and the right people to inspire performance.

So, if you are seriously considering building Purpose into your brand or organisation strategy, what kind of Purpose will it be? Authentic and transformational, or, simple, short-cuts with no tangible impact? Hopefully the right choice is obvious.

Jeff Macdonald and Paul Twivy will be hosting an event to compliment this article at RSA House on Tuesday 21st May. The event - titled 'Purpose: the future of business or just empty virtue signalling?' - is free to attend; you can find more details and secure a spot via Eventbrite.

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