Companies Need To Stop Chasing Profit Like It's Crack Cocaine
We have preached this mantra before: Companies should not focus on profit. They should focus on purpose. Now, after visiting 100+ progressive companies we have seen the evidence with our own eyes.
Progressive organizations do not focus solely on increasing shareholder value. They focus on a shared purpose. Purpose feeds meaning, energy and intrinsic motivation.
Conscious customers in a globalized world
In a previous post we showed how being genuinely purposeful can lead to more profit. This is especially true in a world of conscious customers who choose to buy from companies that do business ‘on purpose’. As a result, purposeful companies become more profitable and sustainable. This is not wishful thinking. This is the new reality.
We are not the first, nor the last, to preach this gospel. The book ‘Firms of Endearment’ gives examples of purpose driven companies like outmatch average S&P 500 companies.
The Rebel Idea
The idea is simple. Sharing purpose fosters community between employees, customers and other stakeholders. It has the potential to inspire colleagues, cut through bureaucracy and release the untapped potential of a business.
Let’s be clear: we are not talking about a purpose framed in pretentious banalities. This is like putting lipstick on a pig for purpose washing.
We’re talking about crisp, clear causes that motivate people inside and outside the organization. It’s as simple as that. Get purpose right and it acts like plutonium. Get it wrong and it’s Chernobyl.
Rebel idea in practice
But, how do you create a purposeful environment? What do you need to think about? How do you change the way teams work?
Below are 5 ways progressive companies distinguish themselves, on purpose. We start simply, and work up to the more radical options.
1. Have a bold purpose people can rally around
The first step is to adopt an inspiring crusade as the raison d’etre of the organization. A credible purpose must meet a number of criteria.
- It is there for the long term – and real impact.
- It must be attractive to the right people.
- It must be lived consistently and honestly.
Purpose is the glue that ties everything together. It drives all that you do. It becomes the fabric of your company. It should be bold, real and authentic.
People want to know what your company stands for. So make sure your purpose has the power to start a revolution that breaks the status quo—whatever that might be.
2. Translate purpose to everyone in the company
Everyone in the company must know and live through the purpose. So, make sure everyone knows it by heart! Only then will they make purpose a reality.
Educate employees about it on a regular basis. Make it part of on-boarding programs, meetings, and all kinds of business activities—until employees take it for granted.
That is completely fine. They want to belong to something bigger than themselves—something to be proud of, to brag about at parties. Constant communication on purpose is precisely what they want to hear.
Allow them to enjoy the feeling that what they do makes a difference in the world.
3. Hire for culture: train for skills
Hire carefully for culture and attitude rather than expertise and talent. Don’t be shy – be ruthless about this point. You can train for skills, but not for attitude.
Spend extravagantly on recruiting, and take your time. Only hire those who can share the purpose and values of the rest of the company. Say goodbye to any misfits that emerge in a probationary period. Weed them out before they can do damage.
4. Measure impact: track progress: share it widely
Employees not only want to know what your purpose is. They also want to know what you are achieving. They want to know the value of what they are doing, every single day—so they can see their own contribution to the big picture.
Make sure they see and hear about this progress. Measuring the impact of the company on the world and show the progress it is making for customers and other stakeholders.
Share these results—inside the company and out. Be authentic and honest.
5. Put your money where your mouth is
Purpose must be lived in an authentic way – even though it can cost shit loads of money from time to time. Believe us: it will prove worthwhile in the long run.
Employees want to see action, not just words. And if they don’t, they will demand it sooner or later. So, show them, time and again! Only then will the purpose-based culture become a self-fulfilling prophecy.
Make decisions based purely on purpose – even if that means financial setback. Then explain to employees why you made the decision. They want to understand your motives. This kind of transparency helps the company reach its purpose.
So, put your money where your mouth is. You can only lose your credibility once!