Purpose is an Anchor
Stock photo

Purpose is one of the most powerful tools organizations have to support strategy. A good purpose places a stake in the ground, declaring what the organization values. It provides flexibility and allows the organization to respond to shifts in the market and customer preferences.

Powerful Purpose Statements

Here’s an example of one powerful purpose:

To transform lives through inspired learning.

This statement is great because it provides both boundaries and flexibility. On the boundaries side, it clearly states that “learning” is the field in which the organization (University of Texas) plays. At the same time, it provides flexibility in how the University provides inspired learning. UT might open satellite campuses in other locations, offer services to continuing or non-traditional learners, and introduce a fully virtual learning experience. All of these actions grow naturally out of the purpose and maintain the organization’s identity while allowing it to evolve and shift as the world does. (A recent visit to UT’s website showed that they watered down their purpose. Now it reads “to transform lives for the benefit of society.” So now they’re no longer in the learning business?!)

Here’s another powerful purpose:

To solve unsolved problems innovatively.

This statement is one of my favorites. It doesn’t define 3M as a paper company, an adhesive company, or an automotive products company (all of which are 3M product lines). Instead, it understands that 3M’s true value is in problem-solving.

That said, 3M’s purpose isn’t perfect. The people served by that problem solving is a little fuzzy. Does 3M solve social problems like poverty or service problems like long lines at the DMV? The statement could use a little more specificity, but that’s a quibble considering its overall strength.

Here’s a purpose for a company you can probably guess:

To organize the world’s information and make it universally accessible and useful.

With a purpose this broad, a company could help people organize information that’s personal (through apps like word processing docs), academic (with scholarly search tools), photographic (using photo organizers), navigational (GPS systems, maps, and driving instructions), language (translation), and so on.

Guessed the company yet? It’s Google, of course. Had they limited themselves to their first, most visible product and defined their purpose as help people navigate the web through speedy, efficient search, we’d lose out on much of the innovations generated by the company.

Going Beyond the Obvious

Organizations that reach beneath the most obvious manifestations of their work (like classroom learning, adhesives, and search engines) to their underlying purpose find greater strategic flexibility and resiliency. One client shifted from thinking from providing digitized financial tools to ensuring a secure retirement (which was achieved through many means, including use of those digitized financial tools). The shift allowed them to extend their strategy to include other services and products that they hadn’t previously considered but were sorely needed by their customer base.

Failure of Purpose: Confusing Product for Purpose

Too many organizations find themselves locked into a superficial purpose that describes only the most obvious work of the organization. Blockbuster, in its zeal to provide videos, failed to anticipate or capitalize on the streaming market. They thought their purpose was video cassette rental. Had they focused on home entertainment, they might have continued to thrive.

This story repeats over and over. Borders Books mistook physical books for its purpose. Competitors Barnes & Noble and Amazon focused on providing access–online, by mail, in various formats–to the books people wanted to read. As a result, they diversified their products to include ebooks and e-readers. Both exist today while Borders closed its doors.

Failure of Purpose: Being Everything to Everyone

Other organizations fail by creating purposes so broad that they could lead to anything. Guess what this company does:

[We] create a shopping experience that pleases our customers; a workplace that creates opportunities and a great working environment for our associates; and a business that achieves financial success.

This could be just about any company on the planet. Who doesn’t want to please customers, create opportunities, and achieve financial success? The organization could be in just about any industry that involves shopping: books, sneakers, plastic molds, accounting software, and so on.

This purpose is so flexible that it doesn’t get at the core, the crux of the organization. It doesn’t identify the field in which the organization operates or the boundaries of their work. It’s so broad as to be meaningless. This organization is, by the way, a grocer (Albertsons).

Is Your Purpose Solid?

A good way to test your company’s purpose is to ask these questions:

  • Is our purpose synonymous with one of our current products and/or services?
  • If we stopped offering our current products and/or services, would we lose our purpose?
  • Does our purpose allow us to operate in any realm?
  • Could a company in another industry easily adopt our statement of purpose as its own?

If the answer to two or more of these questions is “yes,” the organization has a purpose problem.

The Path to Powerful Purpose

Luckily, most organizations have a true purpose. It’s simply hidden. By exploring the problem the organization was established to address and tracing how the organization has adapted over time, people can discover the reason why the organization truly exists. Once that becomes clear, strategic options open up.