As data and digital technology affect every sector, businesses are under tremendous pressure to innovate. “Innovate and disrupt, or suffer disruption,” they are told. This is a huge responsibility for leaders, since innovation starts at the top and is historically difficult to sustain. But their risk of failure goes down and their potential for true impact goes up if they make purpose the guiding light of innovation. Predicting the future is impossible, but when an organization can articulate and activate a higher purpose it has a better opportunity to shape the future of itself and its marketplace.
A report by the Economist Intelligence Unit (EIU) and supported by EY reveals a distinct connection between purpose and innovation. The EIU executive report surveyed 1,000 senior decision-makers from across three global industries to discover how they are responding to disruption.
A 63.4% majority of executives believed that having a sense of purpose and aspiration beyond their day-to-day commercial mission made their company more innovative and therefore more able to disrupt or respond to disruption.
Why is purpose such a positive driver for innovation?
- Purpose creates a culture that supports innovation. When people understand their organization’s values, they are engaged and inspired to work together to promote those values. So employees who are engaged by a company’s purpose are more motivated and willing to invest their time and energy in developing new ideas. And 71.7% of respondents in the EIU report felt that their staff were enthusiastic about their company's broader goals.