Aug 3, 2022
At the heart of any organisation is purpose, or sometimes called mission. Many companies either have a bland statement or none. So why is it so important?
The purpose is the reason the organisation exists, so should act like a compass and guide decision making. Linked to this is the values and behaviours the organisation deems essential to living the purpose.
According to ISO 37000, the purpose should also express the organisation’s intentions with respect to its stakeholders, society, and the environment.
When I was the General Manager for Mars New Zealand I looked after 3 distinct divisions, the chocolate and gum division, the petcare division and the food division. All of these divisions ran separately globally and had their own distinct purpose; for petcare it was ‘To make the world a better place for pets’, what this guided was ensuring that the pet food Mars designed was the very best, the pets loved it, it was better for the pets health and it was better for the environment. It also guided acquisitions, with acquisitions made in pet health areas. It also guided their social goals, linking with pet shelters to help as many pets globally to find a loving home. Overall, a great purpose and one that motivated and inspired employees at Mars New Zealand.
Another good example of a strong purpose is Allbirds “to build comfort and good design into the most sustainable footwear on the planet”.
I admit that I have two pairs of Allbirds. Did I buy them because they were sustainable? No, I bought them because they were really comfortable and the sustainability part made me feel better.
Here is an example of a poor one from the Hershey chocolate organisation “Undisputed marketplace leadership”. Not very inspiring and could be any company.
Their second statement was better and more linked to what they do and why they do it. “Continuing Milton Hershey’s legacy of commitment to consumers, community and children, we provide high-quality HERSHEY’S products while conducting our business in a socially responsible and environmentally sustainable manner”.
Your purpose should link to how you create value for your stakeholders and then help guide the strategy. It does not have to be set in stone, it can evolve as your value creation model or strategy changes, but it is an important reference point and one that can be a strong motivator for your employees (or potential employers), your customers and your other stakeholders.
Written by: Gerry Lynch, Govn365 CEO