Having a clear, meaningful purpose is the foundation of effective leadership and strategy.

For as long as I can remember I have advocated that a powerful purpose can set a company apart from the crowd. The lens I looked through was that of a Marketer, with an interest in building and sustaining a meaningful connection with customers, and preference for my brand. But I have come to believe that companies with purpose, and more specifically a purpose that has a meaningful impact on the lives of those they interact with, are stronger, more sustainable, more able to attract talent and investors, and are financially more successful.

If you are a student of Jim Collins’ teachings this isn’t news to you. He has promoted, what he calls, core ideology as one of the six fundamentals of building companies to last since the 1990’s. Core ideology is the core values and a sense of purpose beyond just making money. I find that many organizations have a good handle on the values but have not spent the time to clarify their purpose.

Purpose is not just a marketing issue.

Purpose should impact every aspect of the company. Companies that enjoy enduring success have a core purpose that remains fixed while their business strategies and practices endlessly adapt to a changing world.

The true magic that pulls teams and organizations together is to be connected to meaning and purpose — the sense that when we get up in the morning, we are each contributing in a real way to an ideal that is tangibly making the world (or our part of the world) a better place. To have this as a foundational driver is priceless. The light of purpose as a beacon that keeps us moving forward in a meaningful direction is ultimately what transforms significant challenges into tremendous opportunities.

Today I spend my time helping CEOs and entrepreneurs build plans and processes to accelerate growth with greater predictability and consistency.

What is the meaningful impact on your community?

The first piece of advice I give is to figure out their “why”. Really sit down (get help internally and/or externally) and think about what it is that you are hoping to achieve out of your business. Is the business serving a bigger purpose? What is the meaningful impact you are making on the communities you serve?

Often, the response is we have a mission statement already. Which is great and useful. But a mission isn’t a purpose. Rather it is a statement that defines the company’s business, its objectives, and its approach to reach those objectives. A company’s purpose is a way to express the organization’s impact on the lives of customers, clients — whomever you’re trying to serve.

Admittedly there is an alphabet soup of the statements that an organization must have in place to get all employees marching to the same beat. You need a mission statement, vision statements, core values, guiding principles, brand promise, personality, and more, right?! Are these important? Yes. Is it detrimental if we don’t have them? Maybe. Would it be common sense to take the time to develop and communicate them? Yes. If you want to be in business, you (and your employees) probably ought to know why and what you’re trying to do. And, at the top of this list is purpose.

I start with purpose because there’s a lot of power in where you focus your attention. The company’s purpose is its reason for being, the why. It’s typically stated in such a way that helps employees understand who the business is trying to impact and in what way. Employees are inspired when they know they are doing something for the good of something or someone else. Define the who and the what, and you’ve got your why.

Employees expect their jobs to bring a significant sense of purpose to their lives. Employers need to help meet this need, or be prepared to lose talent to companies that will.

How to find your purpose.

Purpose should not be confused with specific goals or business strategies. Whereas you might achieve a goal or complete a strategy, you cannot fulfill a purpose; it is like a guiding star on the horizon — forever pursued but never reached. Yet although purpose itself does not change; it does inspire change. The very fact that purpose can never be fully realized means that an organization can never stop stimulating change and progress.

If you’re crafting a purpose statement, my advice is this: To inspire your staff to do good work for you, find a way to express the organization’s impact on the lives of customers, clients, investors, industry advocates, — whomever you’re trying to serve. Make them feel it.

One powerful method for getting at purpose is the five whys. Start with the descriptive statement “We make X products or We deliver X services”, and then ask, why is that important? five times. After a few whys, you’ll find that you’re getting down to the fundamental purpose of the organization.

Who is driving leadership and strategy with purpose?

There are some famous and not so famous examples of companies that are leading with purpose. The level of fame is typically driven by the scope of the “world” they are purposeful to. Most are aware of brands such as Disney, AirBnB, Crayola, Dove, 3M, etc. Each of these companies has a purpose that transcends what they do.

Imagine if Walt Disney had conceived of his company’s purpose as to make cartoons, rather than to make people happy; we probably wouldn’t have Mickey Mouse, Disneyland, EPCOT Center, or the Anaheim Mighty Ducks Hockey Team. Similarly, 3M defines its purpose not in terms of adhesives and abrasives but as the perpetual quest to solve unsolved problems innovatively — a purpose that is always leading 3M into new fields. Crayola doesn’t make crayons but rather encourages children to be creative, and enables parents to inspire them.

There are other companies, not so familiar to the general public that have been able to define and integrate their purpose. I was particularly impressed with a young company from Norway, Memory (www.memory.ai) driven by a purpose to help everyone do work that matters. They have built their business on this purpose as can be learned through reading their manifesto and observing how that has impact which products they build and how they go-to-market. I suspect it also has a significant impact on how their business operates and their people work.

How do you lead with purpose?

Four fundamentals are the core drivers of leadership execution, enabling an organization to lead with purpose and operate with clarity, alignment, and focus.

1. Connection to purpose: The degree to which an organization declares a clear meaningful and visible purpose and integrates that purpose into its strategy.

2. Strategic Clarity: The level of confidence that investors and employees express in the company and the level of clarity of its published strategy. With a shared purpose as a foundation, ongoing clarity on current strategy drives successful execution.

3. Leadership Alignment: The degree of executive alignment around company purpose, mission, or vision as well as employee sentiment regarding leadership effectiveness and organizational agility. Drawing on shared purpose and strategic clarity, aligned and agile leadership across the organization reduces the risk of failure and increases trust and accountability.

4. Focused Action: How well the company performs relative to expectations and competitors, together with employee sentiment on goal achievement and overall execution. With the other 3 fundamentals in place, focused action on what matters is achievable at scale. Employees are empowered to make strategic choices as they work, knowing they are getting the right things done together.

If you don’t know why you’re doing what you’re doing and the people you are leading don’t know why their doing what they’re doing, you have nothing to work toward. Without the shared purpose, organizations tend to run in circles, never making forward progress but always rehashing the same discussions.

Many executives thrash about with mission statements and vision statements. Unfortunately, most of those statements turn out to be a muddled stew of values, goals, purposes, philosophies, beliefs, aspirations, norms, strategies, practices, and descriptions. They are usually a boring, confusing, structurally unsound stream of words that evoke the response “True, but who cares?”

Even more problematic, seldom do these statements have a direct link to the fundamental purpose of the organization. That is the dynamic and primary engine of enduring companies.