How purpose leads to profits

| May 30, 2016

“65% of the economy will face digital disruption by 2017 (Deloitte).”

Disruption will merge sectors and make others redundant. New entrants are now challenging business norms and making huge profits riding the wave.

In order to compete, a simple, solid, strategy can be a mid-sized business’s winning battle plan for sustainable success.

A quick search on the term ‘strategy’ elicits 2,430 million results on Google. The amount of strategic frameworks is now 81 times more than the amount in 1960s. This breadth of choice can be intimidating for most business owners. Here’s a simple flexible solution. It’s called “purpose-led”.

In our experience, with more than 300 clients ranging from mid-sized businesses (Tyro, Qattro and Trimantium Capital) and blue chip companies (AGL, Mercer and Sony Home Pictures), we have seen it’s the purpose-less organisations that end with less, and the purpose-led that survive and thrive.
  

Be purpose-led

Purpose-led businesses can fight disruption not only because they’re inspired, but, because purpose provides them new clarity on new actions to take to achieve their goals.

A great purpose should guide a company’s strategy, be big and aspirational, address geographic boundaries, and inspire all stakeholders.

When writing it be short, simple and punchy.

Most importantly, being purpose-led makes the ‘strategy’ simply a series of actions needed to achieve the purpose in the context of key challenges and opportunities. It’s the “how we do it”.

Or take Richard Branson’s advice on purpose: “Brevity is certainly key, so try using Twitter’s 140-character template when you’re drafting your inspirational message. You need to explain your company’s purpose and outline expectations for internal and external clients alike. Make it unique to your company, make it memorable, keep it real and, just for fun, imagine it on the bottom of a coat of arms.”

Why are you here?

Ask yourself: why does this business exist? What does this business stand for? Revisit the emotional connection you have with your business – the reason you started it. The purpose you choose should always affect the strategy deployed.

Tyro’s purpose is strongly embedded in their desire to offer equality. “To allow small to mid-sized businesses an equal opportunity in the business landscape. To encourage entrepreneurs to chase their dreams and to build a platform that will be used by the businesses of tomorrow.”

This purpose can be seen through the launch of its Fintech Hub, merchant-centric product and launch of small business financing.

Hubspot’s purpose is “to make the world inbound”, which leads to strategies like obsessing over customers instead of competitors, be radically and uncomfortably transparent, and invest in individual mastery and market value.
       

The importance of strategy for mid-sized businesses

Purpose becomes the guide that allows mid-sized businesses to adjust their strategy and tactics to go with the disruption rather than against it. The only challenge left is execution.

If you’ve nailed purpose, move onto ambition, which is a measure of your purpose. This is the tangible aspect of your strategy. It’s about defining the point that you know you have achieved your strategic goals.

For Ford Motors, their purpose was “to help Americans explore this great land.” Their ambition was “to have a Ford in every driveway.”

Ambition is crucial to strategy as it’s the end game – the ultimate expression of your business’s success.

SHARE WITH: