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3 Mistakes That Stymie Corporate Purpose Initiatives

Here is an excerpt from an article written by Lisa Earle McLeod for Harvard Business Review and the HBR Blog Network. To read the complete article, check out the wealth of free resources, obtain subscription information, and receive HBR email alerts, please click here.

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Many organizations are shifting to a purpose-driven strategy, which can be an effective north start in helping guide your employees. But purpose is only valuable when it’s real. So how do you ensure your purpose is more than a tagline?

As the purpose movement goes mainstream, the pressure for organizations to deliver on their purpose is high. An effective organizational purpose acts as the strategic north star for the organization. It defines how you make a difference to your customers and the world. Yet too often purpose gets slapped onto a T-shirt and relegated to HR or social responsibility teams and fails to deliver the financial return that copious amounts of research have shown is possible.

As a growing chorus of customers, employees, and investors ask organizations, “Do you have a purpose, or do you just sell stuff?” leaders find themselves challenged to make their purpose more than a tagline.

After a decade of working in the purpose space, helping more than 200 firms, I’ve observed three mistakes that stymie even the most well-intended purpose efforts.

[Here is the first mistake many organizations make.]

1. A lack of clear metrics

Organizations have metrics for production targets, sales revenue, customer satisfaction, and other key areas. Purpose requires similar focus. Those who are serious about it need to add qualitative indicators to measure progress instead of relying solely on traditional, more lagging quantitative metrics such as revenue and profit.

“The first metric is to have a clearly stated purpose,” Bank of America CEO Brian Moynihan said during a recent World Economic Forum panel. Once you’ve established clarity of purpose, you can identify metrics specific to your aspiration.

For example, Mars Petcare’s purpose is a better world for pets. The company makes a practice of tracking pet health, nutrition, and homelessness to assess strategic progress against its purpose. For a more informal example, the purpose of my client Dave & Buster’s sales team is “We champion laugh-out-loud fun.” Members do walkthroughs at events to see how many people are laughing.

Other ways to measure purpose could be the number of warm referrals you get, client adoption rates, and direct customer feedback. Identifying one simple metric, even if it’s an imperfect measure, will help keep your purpose at the center of daily operations.

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Here is a direct link to the complete article.

Lisa Earle McLeod is a sales strategist and professional speaker whose clients include Salesforce, Kraft Heinz, and Roche. She is the author of Selling with Noble Purpose and an expert in sales transformation. Learn more about Lisa’s work here.

 

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