Purpose drives business performance and business results. But more importantly, purpose can connect people to work towards a same goal in way that nothing else can.
Purpose is the reason why we thought of starting the business in a first place, it helps us explain to the world why our company exists and showing how our company is helping create the world we want to live in.
Purpose is the answer to the question WHY?. While many companies know their HOW and WHAT, the truly amazing companies know their WHY as well. It's what gives them clarity for existence and what helps them reinvent their companies over and over again.
The golden circle is an idea by Simon Sinek, a business consultant and author of an inspiring business book, Start with Why: How Great Leaders Inspire Everyone to Take Action. In one of the most popular TED Talks (around the 2:00 mark) Simon explains it in detail:
All the great and inspiring leaders and organizations in the world, whether it’s Apple or Martin Luther King or the Wright brothers — they all think, act, and communicate the exact same way and it’s the complete opposite to everyone else. This little idea explains why some organizations and some leaders are able to inspire where others are not. Let me define the terms very quickly.
Every single person and organization in the planet knows what they do 100%. Some know how they do it, whether you call it your differentiating proposition or proprietary process or USP. But very very few people and organizations know why they do what they do. And by why I don’t mean to make a profit — that’s a result. It’s always a result. By why I mean, what’s your purpose? What’s your cause? What’s your belief? Why does your organization exist?
... the inspired leaders and organizations, regardless of their size or industry, all think, act, and communicate from the inside out. Let me give you an example.
... If Apple were like everyone else, a marketing message from them may sound like this: We make great computers. They are beautifully designed, simple to use, and user friendly. Want to buy one?
And that’s how most of us communicate. That’s how most marketing and sales are done and that’s how most of us communicate interpersonally. We say what we do, we say how we are different or how we are better, and we expect some sort of behavior — a purchase or vote or something like that. “Here’s our new law firm. We have the best lawyers with the biggest clients. We always perform for our clients — do business with us.” “Here’s our new car — it gets great gas mileage, it has leather seats — buy our car.” But this is uninspiring.
Here’s how Apple actually communicates — Everything we do we believe in challenging the status quo, we believe in thinking differently. The way we challenge the status quo is by making our products beautifully designed, simple to use, and user friendly. We just happen to make great computers. Want to buy one?
Totally different, right? You’re ready to buy a computer from me. All I did was reverse the order of the information. People don’t buy what you do, people buy why you do it.
Knowing what the purpose of your business is can help your employees align their personal purpose with you. And this makes for more motivated, engaged and involved employees. Angela Duckworth in her book GRIT: Why passion and resilience are the secrets to success says explains it really well:
Three bricklayers are asked: “What are you doing?” The first says, “I am laying bricks.” The second says, “I am building a church.” The third says, “I am building the house of God.”
Here is the famous NASA story as told by Mark Zuckerberg from his Harvard commencement address:
One of my favorite stories is when John F. Kennedy visited the NASA space center, he saw a janitor carrying a broom and he walked over and asked what he was doing. The janitor responded: “Mr. President, I’m helping put a man on the moon.”
In his book, It’s Not What You Sell, It’s What You Stand For, Roy Spence defines purpose as:
Purpose is a definitive statement about the difference you are trying to make in the world.
More importantly, unlike mission and vision, purpose is about now, it's about what we are trying to do everyday, and not what we want to acomplish in a few years. It reminds us why we wake up every day and do the things we do.
Nick Sarillo’s TED talk (around the 2:40 mark) explains the difference between purpose and mission and vision:
Purpose is different from mission and vision. There are some great mission and vision out there, but they’re future oriented. We’re striving to get something, somewhere, someday… Purpose is present tense — here and now. It’s why we do what we do. And it’s specific.
With purpose exists to empower the next-generation women entrepreneurs in the Nordics to start purpose-driven companies. See the founders in our network.