20 March 2015

The true purpose of being purposeful

As we are living in the age of transformation once commonly held beliefs are evaporating. This is true for politics, society at large as well as economics. One of the most fundamental changes has to do with our ideas and beliefs about doing business. The homo economicus, the concept of profit maximization, the dominant logic of efficiency and the winner takes it all mentality, they’re all getting obsolete.

In replacement of our former economic paradigms we come up with new ones. An important contributor to this renewal is the emergence of so-called purpose driven organizations. Spiked by Simon Sinek’s famous TED talk, and as an attempt to restore values and add meaning to business in response to an ongoing global economic crisis, we seem to have accepted the idea that doing business needs a purpose. But was does being purposeful in business exactly mean?

Following Sinek’s ‘circle of why’ a purposeful organization is supposed to have a deeply rooted and thriving belief that drives almost every aspect of its operations. In most cases a purpose has something to do with contributing to the common good. Not only does it influence what the organization does, but it also effects how it’s done. Fuelled by consultants selling their services to clients in search of meaning and PR agencies crafting adjoining perfect stories being purposeful is a buzz.

Doing business and contribute profitable and sustainable to the common good, it probably doesn’t get any better. But as purposeful is going sky-high we’re missing the obvious question; what’s the true purpose of being purposeful? When it comes to the ‘why of the why’ we learn there are two distinctive types of purpose driven businesses. As new paradigms always encounter skepticism and criticism, it helps a great deal to acknowledge both so to avoid false expectations.

Unfortunately, for the majority of purpose driven organizations the purpose of being purposeful is simply improving the bottom line. Although these organizations do acknowledge they should contribute to society, this is of secondary importance. Their main idea is that adding value to the common good encourages stakeholders, inside and outside of the organization, to work with them more smoothly. High levels of engagement, less fuzz, lower transaction costs and ultimately higher profits.

Type two of living a purpose in business is completely different. For these organizations the purpose of being purposeful isn’t just making more money. It’s something more valuable: creating a better and more meaningful world worth living in. They operate from the heart whereas type one originates solely from the mind. Truly purposeful businesses go beyond linking their brand to good causes. They are the common good themselves.

Examples of such truly purpose driven companies are Patagonia and Triodos Bank. Their way of redefining business is a direct response to the well-known issues and problems in much troubled industries such as clothing or banking. These kind of purposeful leaders really make the difference, because their core business enhances the quality of live in human terms and with real benefits. That’s what sets them apart from others who believe purpose is just another burning issue in marketing.


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