Putting purpose into practice: 5 “don’ts” and 3 “dos”

When Blueprint started its work with major companies on purpose in 2014, the first question from many business leaders was why: “Why we should spend time on purpose? What is the business case?”

Now, six years on, the first question is usually how: “We get that purpose matters. How do you do this really well, and how do you assess progress?”

The context has changed too. Five years ago, the presenting issue was the need to restore trust. Now it is system change. As one of the recent COP documents put it, the world needs to move from an economic system optimised for growth and profit to one optimised for human well-being and a sustainable ecosystem. Growth and profit are still essential but not for their own sake, rather as the means of creating a beneficial impact and outcomes for society and the environment. Colin Mayer elegantly defines a purposeful company as producing profitable solutions to the problems of people and planet without adding to those problems. The huge opportunity ahead is for businesses to prosper by contributing to - rather than inhibiting - the vital system shift that the world needs.

However, purpose is not the only thing that matters. A company can have a good purpose and yet still be a terrible place to work, and not care about people whether they are customers, suppliers, communities or future generations. What cuts even deeper than purpose is how the company thinks about people. Our starting point is that a business is first and foremost a series of human relationships, and business, society and people all benefit if these are based on respect for the dignity of people, embracing all those the business touches.

Increasingly we find ourselves talking about the aim of becoming a “purpose-led” business, which is different from simply “having a purpose”:

• It demands a frame of mind within the organisation, animated by an authentic, inspiring and practical purpose to benefit society, which shapes thinking and drives decision taking so that there is a clear, simple and credible narrative linking the purpose to the strategy and the outcomes and impact from that strategy (financial and non-financial) back to the purpose.
• It also demands a way of thinking about people which sees a business as essentially a set of relationships, and that the long-term success of the business crucially depends on the quality and sustainability of these relationships. A purpose-led business sees itself as creating the conditions where each person is seen as a “someone not a something”, and the business seeks to have a positive impact on the lives of all those it touches.
• The quadrants around the purpose commitment in Blueprint’s Five Principles are one way of characterising these relationships and underline that in a ‘purpose-led’ business they are constitutive of its success, rather than instrumental to maximising profit or pursuing a good purpose in an exploitative way.
• A purpose-led business adopts a long-term approach that delivers sustainable performance that benefits both business and society and attracts support from responsible investors.

Encouraged by the 2018 corporate governance code, and the excellent Wates Principles for large private businesses, as well as the rising expectations of investors and others, many major UK companies are now engaged in one way or another on work on putting purpose into practice. .

So how do you do this really well? We are learning a lot from the companies we are working with, and a range of thoughtful fellow travellers working in different ways with companies large and small.

Based on our experience, here are five don’ts and three dos:

Five “don’ts”

1. Don’t think of purpose as a project. It isn’t. It is about the core and enduring identity of the business and the impact it seeks to have in the world reflected in what it says, what it does and how it does it.
2. Don’t create a “head of purpose”. You have one already. The CEO.
3. Don’t think of purpose as being about brand and comms. Interestingly the FRC in their January 2020 report on early adoption of the 2018 corporate governance code makes just this criticism of many FTSE 100 companies. If purpose is just new ‘wallpaper’ it will not change anything fundamental, and at worst simply create cognitive dissonance.
4. Don’t allow purpose to become corporate social responsibility on steroids. A natural and understandable temptation is to think of “social purpose” as distinct from the core business, and manifested only in tangential social goals.
5. Don’t allow purpose to become just an HR initiative. A key merit of becoming purpose-led is that done well it switches on the latent potential in people to commit to a shared worthwhile endeavour. But if the motivation is just to use purpose to drive employee engagement, it will not deliver.

Three “Dos“

1. Reshape leadership and governance around becoming purpose-led. Once there is a clear articulation of the purpose which is inspiring, authentic and practical, work to ensure alignment of the executive team about the ambition to become purpose-led and the mindset shift about purpose and people that this process demands.They need to believe this will deliver a better business. This is essential to create clarity and agreement about the direction of travel and to secure broad buy-in. The Board also needs to own the purpose, and then to see it’s role as the collective trustees of the purpose of the business, and of all the relationships on which the long term successful pursuit of that purpose depends. Purpose-led leaders recognise the need to institutionalise dialogue and welcome scrutiny to help the business stay true to its purpose over time.
2. Create a strong operational link between purpose and strategy. If the purpose is to live within the business it needs to direct and shape the business model and the strategy, what products and services are provided, to whom and how. The financial and non-financial outcomes and impacts from the strategy also need to tie back to the purpose. A purpose-led business will seek to think in an integrated way so that sustainability and responsibility become aspects of a single core strategy.
3. Create a culture of relationships where everyone is “a someone not a something“. The true power of a purpose beyond profit is only released if people inside and outside the company feel that the business cares about people, and is not simply using them to make more money. Purpose-led leaders make a choice to appeal to the human desire to engage and contribute and do so in a way that creates better outcomes for the business, for society and people. They will also avoid command and control “rolls outs“, and by asking not telling create space for middle leaders to challenge, test and contribute.

None of these “do’s “ is easy, All take commitment, energy and perseverance. What is exciting is to see more businesses engaging on all three of these areas, recognising that all of them are vital constituent parts of bringing purpose to life and that this is a deep shift in thinking and practice which cannot be rushed. So if I were to add a 4th “do“ it would be: take your time.

If you want to read more about leading through a period of change and what guides decision taking in practice read my article Navigating Purpose – provocations for CEOs

If you would learn more about Blueprint head to https://www.blueprintforbusiness.org/