The importance of having businesses build a “culture of purpose” came to the attention of Deloitte LLP Chairman Punit Renjen when he recently spoke at prominent business schools at four universities within a period of a few weeks.
Two of the campuses Renjen visited were in the United States, and two were in India. But one common question emerged from students. At each school, they asked Renjen: What does your firm do beyond fulfilling its motive to make profits?
The students were demonstrating the notion of a sense of purpose that Renjen said is “a new imperative for business”.
“It became very clear to me, across two continents, that this generation is increasingly focused on joining organisations that have a culture of purpose, that have a positive impact in everything that they do – and that profit is an outcome, it isn’t a goal,” Renjen said in a telephone interview.
These expectations are not being met by many businesses, according to results from Deloitte’s newly released, annual Core Beliefs & Culture survey. About two-thirds of employees (68%) and executives (66%) said businesses are not doing enough to instill a sense of purpose in their culture that strives to make a positive impact on all stakeholders.
The survey polled 298 executives and 1,012 non-executive employees of non-government, for-profit businesses with 100 employees or more in the United States. The results showed that a culture of purpose correlates with a competitive edge for businesses.
Respondents who said their organisation has a strong sense of purpose were more likely to say their company:
• Had performed well financially over the last year (90%) and historically (91%).
• Has a distinct brand (91%).
• Has strong satisfaction amongst customers (94%) and employees (79%).
In Renjen’s view, a sense of purpose means operating in such a way that the business has a positive impact on all stakeholders –customers, clients, employees, the community and society in general.
Operating with a sense of purpose involves three key steps, according to Renjen:
• Articulation. An organisation’s purpose should be unique because each organisation has its own set of competencies and beliefs, Renjen said. These beliefs should be articulated in such a way that they capture the essence of the organisation, according to Renjen.
• Propagation. Use of multiple media will reinforce the message, Renjen said. One of his methods is a recap he sends to Deloitte’s entire population of partners and directors after board meetings. He uses these summaries, which he said are sent about nine times a year, to remind partners and directors of Deloitte’s core beliefs.
• Embedding. The sense of purpose can be introduced during employee training, used as a guide to influence decisions and incorporated into employee performance metrics, Renjen said, in order to align employees’ actions with the organisation’s beliefs.
“It isn’t just a set of slogans or something that is repeated by leadership,” Renjen said. “But it has to be in everyday living a real guidepost in how the firm operates.”
But the survey shows that a sense of purpose appears to be eluding many companies. Just 52% of employees strongly agreed that their company has a strong sense of purpose, and 41% strongly agreed that they could explain their company’s purpose.
After speaking with business students who will enter the workforce soon, Renjen is convinced that it’s essential for organisations to embrace this culture of purpose.
“If you really want to have exceptional performance … you have to win not only the minds of individuals, but you have to win their hearts,” Renjen said. “And you win the hearts of individuals by having a real sense of purpose.”