How to Build a Purpose Led Business
You’ve probably become aware of Simon Sinek’s “Why Great Leaders Inspire Action” TEDTalk from 2009. It’s had over 48m views, if you haven’t seen it, here’s the link.
He talked about finding your ‘why’. At Tricres, we call this Purpose and it sits at the heart of every model we implement in businesses across the world. There are entire organisations set up to promote and encourage purpose-led businesses, we currently work with Future X which exists purely to promote a better world through purpose-led businesses.
So is it a fad? Is it just another new-fangled idea that we can think about this year and ignore? Personally, I think not. History tells us that the best, most sustainable businesses that have ever existed are ones that are purpose-led.
Going back to the Victorians and the industrial revolution, we see the mill owners who built schools. Who housed their workers, provided medical care and a basic welfare system were the ones who thrived. The Rowntree family founded chocolate factories that were bought by Nestle decades ago, but their foundation still exists to this day.
By contrast, there are examples of businesses that no longer exist whose only purpose was to make money. Enron, RBS (about to be renamed NatWest – a bank they had originally bought over) are two that spring to mind immediately. Then there are those businesses that perhaps started out with a purpose and lost their way. Examples might be Woolworths, Kodak and Thomas Cook.
So a purpose isn’t just nice to have. Because it’s something that gives businesses longevity, strong foundations and direction, even when the landscape shifts.
The purpose-led businesses that we’re all familiar with are Apple, McDonald’s, and Virgin. They have innovation, family and excitement, and sexiness at their core respectively. This is all very well you might say, I’m just running a cake business or a plumbing business or have a fledgling tech start-up business. What do those huge organisations possibly have in common with me?
As a result, even in a small marketplace, your purpose will shine through. Take a look around your high street. Which restaurants do best? Which florists are surviving despite the rise of the supermarket bouquet? It’s those who really understand why they do what they do.
The restaurant that exists to provide a family atmosphere for special occasions is the one full of families celebrating. The one that understands it exists to ensure couples have a truly special night in a romantic setting is fully booked all year, not just on Valentine’s Day. And the florist who understands they exist to make the wedding or even funeral experience the best it possibly can be is the florist who thrives even if they’re situated next to the supermarket.
What’s the Key?
The key is that they know why they’re doing what they’re doing and they are passionate about it.
They understand who their customers are and why they buy from them. Because they keep providing that product or service whilst making innovations and tweaks that fit with their purpose. Sometimes, a business has to do a full three-sixty degree turn to keep aligned with its purpose. But this can be painful but prevents a slow decline.
For example, retailers are the best example of this in our modern age. Because if Woolworths had declared its purpose to provide a convenient way to shop for all your household needs, it may well have stopped Amazon in its tracks. But it didn’t. It was a retailer which sold stuff and in the end, could not compete on that basis with Amazon.