Finding your purpose?
Money, money, money
As Management Today noted recently, “All businesses have a purpose. Under company law, the default purpose of a limited company is to benefit shareholders, while having regard to wider stakeholder considerations.” But this isn’t enough for many businesses. For example. Beer marketing is normally about which pint is (probably) the best. However, Heineken’s “Open Your World” ad placed political opposites together to complete a task. After they’ve worked on the problem, they are then shown videos of their partner’s opposing points of view. But will they leave or thrash out their differences (over a pint of Heineken)?
What’s the point?
Well, the brewer wants to demonstrate that the company is about more than selling beer - that it has a purpose beyond profit. And it’s not the only one to be pushing this message.
New research. Danone, the multinational dairy company, is another that’s big on purpose. It recently commissioned some research that showed more than a quarter (27%) of managers in British companies said they would be likely to take a pay cut to work for a company that had a clear purpose beyond profit. What’s more, 32% would leave if the company they worked for didn’t have a purpose, whilst 53% would do so if the firm’s values didn’t align with their own.
Purpose benefits. The study also showed that purpose-led company staff are more positive, more engaged and have greater career confidence. There’s a growing pile of evidence to show that a purpose can attract staff and drive profits. More than one in five (22%) SMEs also have a particular social or environmental goal. But you must tread carefully.
Marketing gimmick
In recent polls, 73% of consumers said they would be more likely to buy from purpose-driven brands, but 40% think it’s a PR spin. A few big brands have tried to publicise their new-found purpose only to be shot down. PepsiCo is perhaps the most famous example. The soft drinks brand tried to “project a global message of unity, peace and understanding” in its video, but ended up being criticised for “co-opting the imagery of protest movements to sell soda”. The campaign was binned.
So, what is a good purpose?
It depends on your business. It could be environmental, community-based or involve wider benefits to society, e.g. the provision of valuable products, jobs for local people, etc. Tip 1. You can’t pick a purpose overnight, and doing so could lead to criticism, which can spread quickly online. You don’t have to tackle tricky social issues or set impossible environmental goals, it’s about the direction you’d like to head in. Think about what matters to your company and how you want it to evolve. Tip 2. The government has launched a free digital tool to help. You are asked a series of questions about your business. Based on the answers you’ll be given a few options to amend your company articles and then tips on how to redraft them to include the purpose. They can be personalised as much or as little as you need and registered with Companies House. Go to www.getpurpose.ly .
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