Purpose - sense or nonsense?

Please may I talk about business ‘Purpose’? Well, not so much talk about it as air my confusion about the term, in the hope that I might tempt some of you to enlighten me.

Let me start by outlining the source of my confusion. More than four decades ago Peter Drucker wrote this (in Management, Tasks, Responsibilities, Practices - Peter Drucker, 1974):

“To know what a business is, we have to start with its purpose. Its purpose must lie outside of the business itself. In fact, it must lie in society since business enterprise is an organ of society. There is only one valid definition of business purpose: to create a customer.”

Now, that has the kind of directness and clarity I can relate to. As far as I’m concerned it’s up there with Winston Churchill (13th May 1940):

“You ask, What is our aim? I can answer in one word: Victory – victory at all costs, victory in spite of all terror, victory, however long and hard the road may be; for without victory, there is no survival.”

And yet, these quotations hint at part of my confusion. Drucker says ‘purpose’. Churchill says ‘aim’. Are they synonyms? And, in addition to ‘purpose’ and ‘aim’, what about ‘mission’, ‘vision’, ‘goal’, ‘strategic intent’, ‘destination’ and, even, BHAG (honestly! Google it)?

Somebody must know because lots of people talk about it and my friends at Contexis – www.contexis.com – have recently posted that “90% of CEOs now claim to be actively engaged in implementing or exploring Purpose.” Hmm, so not only must a lot of people understand this term, they must also think it very important.

Now, I concede that the Drucker and Churchill quotes are high level statements. “To create a customer” is a universal thought, applicable to all businesses. And there’s little point in fighting a war if you’re not fussed about coming second. So perhaps these purposes/aims are the generic, universally applicable versions – necessary but not sufficient? If this is so, should there then be ‘sub-purposes’, specific to individual business entities?

To explore this a little, I enthusiastically devoured a recent HBR article (Connecting Purpose and Profits, June 18, 2018) hoping for clarity. Here, I extract the ‘purposes’ quoted in the article:

Sephora (cosmetics and beauty products): “inspiring fearlessness”. One Medical: “to transform healthcare”. Visa: “we strive to be the best way to pay and be paid, for everyone, everywhere". HP: “to create technology that makes life better for everyone, everywhere”, (although this is referred to as a vision.) Square: “economic empowerment by helping entrepreneurs to start, run, and grow a business.” Levi’s: “profits through principles.”

I cannot for the life of me see the thread that gives these statements congruence. And, to complicate matters further, the article seems to use some terms interchangeably. For example, the authors write: “People are looking for a worthy purpose or vision they can believe in” which seems – does it not? – to imply that purpose and vision are synonymous.

Oh and, by the way, when referring to the HP example, the authors also bolt on “... and a mission to ‘engineer experiences that amaze’.” So, for HP, we have a vision (“to create technology that makes life better for everyone, everywhere”) and a mission (to “engineer experiences that amaze”). Do these two statements together constitute a purpose?

Whoa! Let’s back up and see if we can find a strand of chewing gum that might connect the elements in some semblance of a logical order. Aha, pulls down from bookshelf The Committed Enterprise by Hugh Davidson in which, back in 2002, Davidson sought to clarify this taxonomic muddle. His research with 125 organisations in the U.S. and UK led to the following:

Issue: What are we here for? Possible descriptors: Purpose, Mission, Aim. Issue: Where are we going? Possible descriptors: Vision, Goal, Strategic Intent, Destination, Future direction. Issue: What beliefs will guide our behaviour? Possible descriptors: Values, Credo, Ethos, Principles, Guidelines, Rules

This classification seems logical. To show it in practice, Davidson gave the example of London’s Metropolitan Police. Purpose: Making London safe for all the people we serve. Vision: To make London the safest major city in the world

I think that is eminently clear – a fact that causes me to wonder whether, since the millennium, we may have moved from clarity to fog. Or would that be an unfair conclusion?

To conclude, let me mention one further ‘line of enquiry’, Simon Sinek’s Start With Why approach: https://www.youtube.com/watch?v=u4ZoJKF_VuA&t=498s I love this exposition, exemplified by the re-ordering of Apple’s messaging into a Why, How, What sequence (Start With Why, Simon Sinek, 2009):

“Everything we do, we believe in challenging the status quo. We believe in thinking differently. The way we challenge the status quo is by making our products beautifully designed, simple to use and user friendly. And we happen to make great computers. Wanna buy one?”

I see ‘the Why’ as being congruent with ‘Purpose’ but, other than that, it seems to me that 2018 efforts to clarify Purpose more often than not muddy the water. Is that unfair?

[email protected]