The balance between profit and purpose is one principle of which more businesses pay attention. They do so for many good reasons. Profit, of course, is the assumed goal of business generally. Though much maligned, profit has to be acknowledged as the thing that makes a business possible, and therefore allows it to meet the needs of its employees for food, shelter, and all the other necessities of life. Purpose is hardly new either, but even the most cynical observer would have to concede that purpose has recently made a big leap from the mission statement and the marketing campaign, to a centerpiece in many companies’ strategy and tactics.
Likely everyone reading can think of one example of a company that puts purpose front and center: the shoe maker that gives a pair to charity for every pair it sells, the corporation that purports to do no evil, the electronics maker that gives away laptops. You needn’t be an ideologue to see the value that purpose brings to an organization.
Fast Company noted many reasons why purpose driven companies are often more successful. The fact is that purpose can be a huge leg up, particularly in an innovation based economy that requires more and more from its employees. Just think about it: you’re starting a new firm in Silicon Valley. Your numbers will be small to begin with—a few dozen, perhaps 50 or 100 in a couple years. The hours will be long, so you’ll need to be able to work closely together, and in challenging circumstances. The rewards, while potentially great, are also delayed, so you’ll need some common thread to keep you going in the meantime.
A purpose can do all that. Most obviously, it provides the overarching motivation that a firm can use as a rallying cry. Chosen well, it gives shape to the decisions a company makes, even on a day-to-day basis. What governs? The purpose. What decision best serves the purpose? And of course, the right purpose extends out of the company and into its customers, so that serving that purpose only makes its products more attractive to its buyers.
On a more subtle level, purpose also helps an entrepreneur select a group of people who’ll be spending a lot of time together. They’ll need to be very different, of course, with a wide range of skills and specialties. People different in those ways can also be very different in habits and preferences and opinions. Belief in that purpose, then, becomes the thing that makes the right partners identifiable.
A company organized exclusively around a purpose is, of course, a charity. Charities are wonderful, necessary, and highly valuable to society. But if every company were a charity, there would be no charity at all. There is room for both then, companies that, rather than placing profit above all, find a bit of good to do in the world at the same time. The evidence is growing that the public will also reward such efforts—if only they are given A Refreshing Alternative.