The definition of purpose is pretty broad: the reason for which something is done or created or for which something exists. But as the flavor of the decade, marketers have bastardized the concept of purpose in so many ways.
Can we be a bit more purist about purpose? Probably not; the horse has already bolted. But in a recent study entitled “Growth Drivers” led by Brand Learning, purpose emerged as a key driver of growth. Purpose has been heralded to drive growth by many, not least of whom Jim Stengel in his book Grow: How Ideals Power Growth and Profit at the World’s Greatest Companies.
What’s new in the “Growth Drivers” study is the qualification of growth. The research warns against growth at any cost. Customers and consumers have placed the nature of growth under new scrutiny given the planet’s finite resources, the questionable practices of some companies leading up to the financial crash and since, and short term growth pressures from investors in markets that have slowed in recent years.
The study found that employees, for example, do not care about financial growth as much as leaders might think. Business success alone is not reason enough for people to change or to release their discretionary energy working for heir company. Instead, they need to relate to the purpose of growth. What type of growth is the company pursuing and why, and how does that relate to the company purpose?
Purpose is a leading characteristic of “Growth Driver” organizations. Some 87% are guided in everything they do by a clear purpose. The others have stated purposes but these are, to cite one respondent, ‘missions laminated not lived’. “Growth Driver” companies, by the way, are defined by organizations with a track record of greater than 6% growth per annum for the previous three years, confident of hitting their growth goals for the next three years, and qualitatively, they were admired by those interviewed for the study.
Growth Drivers are more likely to have a clear purpose, customer-centered leadership at the highest level and a clear capability strategy. The factors that most differentiate them from others are having a joined-up strategy around the customer experience, along with the structure and capability strategy to enable their people to deliver it.
By connecting growth with purpose, leading companies make their growth agenda meaningful. And with that meaning comes bolder strategic choices and stronger ambition.
“The pursuit of growth for its own sake is quite dangerous,” said Sir Roger Carr, Chairman of BAE Systems. “You’ve got to be very careful not to be bewitched by growth – it has to be part of a business model which has more thoughtful outcomes than just revenue increases.”
Inherent in this shift towards purposeful growth is an emerging language. Supplementary to interviews with 70 business leaders, annual report analysis revealed a change in language surrounding the subject of growth. There is increased emphasis on words like society, sustainability, responsibility and ethics. A notable increase in support for internal economic checks and balances and a more stable and responsible economic structure. Terms such as ‘stable’, ‘long-term’ and ‘sustainability’ became commonplace by 2014, suggesting that companies are keen to address social anxieties surrounding the reckless lending, over-extension and other factors contributing to the economic crash of 2008.
Setting a growth purpose acts as a springboard to choices and activities, and this has been borne out by Brand Learning’s research of companies like Patagonia, Under Armour and Nike. Patagonia, for example, has created two powerful programs steeped in the company’s purpose. Its “Worn Wear” program not only offers tools and tips to its customers for fixing their their own gear, but offers to buy back gently used clothes too. The company also created a short but powerful film showing its traceable down policy in product sourcing. Both have been featured by Fast Company.
Not every company can be a Patagonia and many larger more historied brands don’t have the luxury of starting with a clean sheet. Take Unilever for example. The company claims to have “ambitious plans for sustainable growth and an intense sense of social purpose”, and has re-oriented its business around sustainability with a goal to double its revenue without increasing its environmental footprint. In practice, this means finding ways to halve its environmental footprint while enabling growth, leading to new practices in supply chain, brand development, and every part of its business around the globe.
More data from the Growth Drivers Study is available and includes an infographic and white paper. Research for the Growth Drivers study was conducted in 2015 with contributions from over 900 people in over 90 companies from 42 countries, including 70 chairmen and CEOs, business leaders and industry experts who were interviewed in depth. The research was initiated and led by Brand Learning in partnership with The Marketing Society (UK), The Conference Board, the Marketing Academy, Mobile Marketing Association, Econsultancy and Marketing Week.
This article was written by MaryLee Sachs from Forbes and was legally licensed through the NewsCred publisher network.