How to attain purpose-led business transformation

Extensive research has highlighted the benefits of being a purpose-led business, demonstrating how it leads to higher levels of growth and resilience to disruption.^1,2 However, beyond the compelling business case, the expectations and priorities of employees and prospective talent pools have shifted and there is an increased demand for organisations to provide more meaningful work. This is supported by our data, which showed that 84% of employees feel it’s ‘very important’ or ‘important’ to work for an organisation that positively impacts society, demonstrating the critical role purpose will play in attracting and retaining talent. 

This shift towards being more purpose-led is also mirrored by customers and investors. 72% of consumers feel it is more important than ever to buy from companies that reflect their values,³ and 88% of institutional investors claimed to hold an organisation’s ESG metrics to the same level of scrutiny as financial and operational reports.⁴ However, despite this, purpose-led transformation for many organisations remains surface-level. Our survey found that 71% of employees think their leaders still ‘always’ or ‘often’ make critical decisions solely based on financial considerations, such as profit, costs and growth. 

Pitfalls of purpose-led transformation

Being purpose-led requires much more than a great purpose statement. To become truly purpose-led, organisations require tangible action to accompany their declared intent. However, with companies increasingly being recognised as proactive drivers of global change, a common pitfall is failing to deliver this authentically. This so-called ‘say-do’ gap can lead to a disconnect between the articulated purpose and day-to-day lived experience. For example, our survey highlighted that 86% of employees say their organisation has a purpose statement, but almost half (42%) of them didn’t know what it was. Leaders play a critical role in not only stating purpose ambitions, but also in following through with action.

How to activate and embed purpose-led practices

Best practice for getting on the right track

A critical aspect to ensuring successful purpose-led transformation is identifying an organisational purpose that inspires, is practical and authentic. Getting this first step right is pivotal in realising purpose-led ambitions and enacting real change. Below are two key principles that will help an organisation get its purpose on the right track:

1. The purpose statement should be co-created – leaders must consult their people in the creation and development of the organisation’s purpose, using diverse minds to craft an effective purpose.
2. Purpose must be coupled with strategy – having a business model and strategy that places purpose at the core will enable purpose-led action.

Best practice for staying on course

Ensuring sustained purpose-led activity is critical in enabling successful transformation. Below are four top tips on how to effectively implement purpose-led transformation across the business. 

1. Engage senior leaders and role model new habits in decision-making - consider how each function must be modified to enact positive purpose-led change, then ensure these changes are filtered through the organisation. 
2. Create personas to inform decision making – forming a purpose-led persona creates a tangible way to visualise the impact of the day-to-day decisions that are made.
3. Establish how to measure and report purpose – integrate purpose-led metrics, such as environmental, social and governance (ESG) and long-term value reporting, into annual reports. 
4. Reward people for driving purpose-led transformation – clearly link purpose with how people and the leadership team are rewarded to demonstrate commitment.