I saw a Patagonia label on a friend’s jacket, and it caused me to think about Patagonia and about corporate purpose. Patagonia achieved remarkable results by re-framing their corporate purpose–from more devoted customers and stakeholders to dedicated employees. Why has Patagonia become a brand so closely aligned with doing good? How did they do that?
According to a 2019 Forbes article: in 2018 the company “changed their mission from a product/purpose hybrid of ‘Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis’ to the clear, short, purpose-driven mission ‘Patagonia is in business to save our home planet.’
There’s no doubt that Patagonia’s change in company purpose has been good for business, and a re-framed purpose statement can be good for yours. It helps in many ways. In a 2020 blog, I highlighted six positive outcomes that result from a strategically re-framed purpose statement:
1. A clearly stated, meaningful purpose differentiates your organization.
2. It sets direction and becomes the foundation for organizational culture and organizational alignment. Once you clarify the purpose statement, you can act upon it by aligning your strategy and tactics with it.
3. It provides a compass when things get tough, allowing you to keep on track.
4. It helps you keep your customers and retain more. More an ore, customers are aligning themselves with organizations with purposes they can identify with.
5. It helps you retain, engage, and nurture high performance and morale in employees. A strong purpose statement employees can identify with strengthens employee loyalty.
6. Because of its impact on employee morale, it helps you recruit employees even in the tightest, candidate-driven markets.
If you have not yet created a strong corporate purpose that allows your organization and others to clearly see the lasting, positive impact your company wants to have on society, perhaps you’re wondering: Will reframing our purpose cause us to change products or services? How will we get our leaders and employees to buy in? Will it distract us from the bottom line? Is there a way for corporate purpose and the bottom line to align and reinforce each other? How do you do that?
Defining an energizing corporate purpose may seem easier for a start-up like Bombas socks, with their “one purchased=one goes to a person in need.” Their entire product lineup feeds their corporate purpose. But what about larger companies that have been around for a while?
Strong corporate purpose is not new; it just wasn’t as trendy or transparent in earlier years. Back in the 90’s, a client company was known for investing itself in the communities in which it operated. This global textile giant supported local k-12 schools including Governors Schools for the arts and for science and mathematics; and they beautified their corporate properties, local communities, and airports by planting beautiful trees and shrubs. They created summer leadership programs for rising High School seniors. They led the way with green initiatives by reducing or eliminating waste to landfill, conserving and reusing water in their manufacturing processes. In this organization, the program had leadership buy in and employee buy-in, and the greatest champion for the program was the CEO himself.
In creating corporate purpose, where should we start? Where do we look for inspiration? I recommend looking at your mission, your values statement, or your organization’s greatest strengths. For example, a 30-year-old New England-based employee benefits firm had a slogan on their web site, “We care about how we can help.” It was a genuine statement of their mission and how employees related to customers and clients: employees helped them find the best solutions for employee benefits, employer-sponsored retirement plans, wealth management, etc. Indeed, in my opinion, the employees’ genuine care for clients is that organization’s greatest strength. When it came time to re-tool the company purpose, they merely broadened the focus. The company looked at ways to help people and non-profit organizations in the communities they serve.
They now have a successful program that donates time and money to charities throughout New England and beyond. Employees identify charities that need support, and the company provides resources to help. Sometimes it is money, and more frequently it’s in man-hours. The firm supports each employee by subsidizing at least 8 hours a year to work at a favorite charity. The firm also extends its caring to employees with innovative employee benefits such as tuition reimbursement and a financial wellness program to improve employee financial health. In this case, the organization looked at its mission and values to broaden into a corporate purpose. As it envisioned the program, it leveraged input from employees and customers. It also showed that it meant business by hiring a champion for the initiative, reporting program progress in every staff meeting, generating goals and building measurements for success—measurements that are transparent to employees. The perhaps unexpected outcome of the program is that it helps the company more easily attract employees and customers—both wishing to work with a socially conscious organization.
Your organization may wish to start the process by soliciting input from employees and stakeholders through interviews, surveys, workshops, and chat rooms not only to establish a clear picture of your current state, but also to get ideas for needed changes and appropriate ideas related to purpose. Your new purpose may be a new product or service. Or it may be some other important purpose, supported by the organization’s revenue, as in the textile company mentioned above.
Another good resource for ideas related to purpose: the UN Global Compact has 10 principles as part of its Global Compact program. Any one of those principles could be the idea to initiate discussions behind a new corporate purpose.
As your organization looks to re-tune or create corporate purpose, there are some realities to face:
1. The process may create some candid, uncomfortable discussions as you gain a clear picture of the current state and as you evolve into consistently living by the new purpose. Employees and stakeholders alike will help you uncover inconsistencies and point out where the organization is not “walking the talk.” This is positive and necessary if you want a meaningful, lasting corporate purpose.
2. Some employees and stakeholders may criticize the company for “going soft,” taking its eye off the bottom line. Hear them out. Clearly communicate what you’re doing and why and how it may benefit them.
3. Rethinking purpose is not a process set in stone; it’s evolving. Take time. Listen well.
4. As long as you create a purpose that is realistic, genuine, and meaningful to employees and stakeholders, and you build in the necessary “underpinnings” of processes, communication, measurement and incentives to leaders based on program results, you will very likely see significant benefit to the bottom line.
For a complimentary 60-minute discussion about what goes into an effective purpose statement, please contact me at [email protected] or in LinkedIn at https://www.linkedin.com/in/transformingorganizations/.