What 1,000 CEOs say about purpose – and why activation is what matters most
Iago John, senior consultant at independent consultancy Brandpie, discusses the interesting results from Brandpie’s 2022 CEO Purpose Report, and how purpose now guides strategy.
The results are in. Purpose is now firmly embedded at the top of the table and influences the majority of strategic decision-making – according to 73% of CEOs.
We interviewed 1,000 CEOs across seven markets, asking 15 questions on the drivers and challenges that they face – ranging from what was most central to their business philosophy, what’s driving their value creation, and of course, the role of purpose.
The result? The Brandpie 2022 CEO Purpose Report, which casts a comprehensive light on the role of purpose among 21 different industry sectors. Its headline findings include 83% of CEOs either have or want a purpose, and those that do have a purpose see it as the number one driver of long-term value creation.
But it’s the extent to which purpose is used to guide strategy and decision-making that proves most encouraging. Purpose can be just words on paper – or it can change the world: the key is in its activation.
Purpose in action
A key finding from the report was that different sectors want their purpose to do different things. When we asked CEOs how they measured their organisation’s performance against their purpose, the top three responses were sales and growth (37%), customer satisfaction (32%) and financial performance (29%). The impact of purpose is most certainly being measured by its influence on the bottom line.
However, the picture is a bit more complex when delving deeper: different sectors place greater value on what their purpose can achieve.
- For legal firms, 44% said they believe the main role of purpose in their organisation related to connecting to local communities, much more so than any other industry and the average score of 24%.
- For public servants, purpose is key to “employee motivation” – scoring 50% and more than double the average score of 23%.
- For healthcare, it’s about employee engagement – being a ‘good place to work’ is in at 38% versus an average of 27%.
- And for the hospitality and tourism sector, perhaps unsurprisingly, their “reputation” was valued more than any other sector – 28% against the average 20%.
Where does that leave us?
On one hand, it shows the breadth of benefits purpose can have on different organisations. Clearly, different sectors are using purpose as a strategic tool to either push an agenda or to address underlying issues. On the other, the diversity in responses across the 21 sectors suggests there is an opportunity to be had for measuring purpose against multiple criteria.
How then can organisations deploy their purpose beyond their most pressing (and possibly) narrow needs, so that purpose drives integrated and multi-stakeholder value?
Purpose activation model
At Brandpie, we define purpose as the challenge you set the organisation, connecting what you do with what the world needs in a meaningful way. It inspires, challenges, and enables you to build long term value creation.
We help our clients to become more purpose-driven by embracing four strategic activation principles: a purpose needs to steward the business for the long term, to empower people to act, influence behaviours, and to advocate change.
Judging from the above data points, the legal, healthcare, public sector and hospitality industries have used their purpose to advance in each of these respective pillars. And while there’s nothing inherently wrong with leaning more into one principle than another, we’d contest that if any organisation truly wants to fully activate their purpose, then all four principles merit exploration.
Why? Because each principle provides a pathway to maximising the potential of this powerful tool. Because each is equally important and interconnected. And when viewed in isolation, they can backfire – advocacy without stewardship can result in purpose washing and influencing behaviours without empowering people can stifle innovation.
Given that 73% of CEOs also say they are accelerating their efforts to focus on long-term value, we’re hugely encouraged that leaders haven’t finished exploring what purpose can do for their organisations.
For anybody wanting to embark or expand their purpose journey, we’d suggest asking these searching questions:
- Is your purpose stewarding your organisation by guiding your organisation to thrive in the long term? Is it creating new sources of value? Is it a lens for decision making? Is it shaping a world fit for future generations?
- Is your purpose empowering people (your employees and multiple stakeholders) to act? To innovate? Do they have the ownership and ability to deliver on purpose – individually and collectively?
- Is your purpose positively influencing the motivations, behaviours, and choices of people? Are you changing beliefs?
- Is your purpose visibly advocating the world you want to live in? Is it leading the way, guiding others? Are you inspiring others to join in?
Activating purpose is challenging, takes time, and is always a journey. But it doesn’t have to be onerous. Our step-by-step methodology helps clients to address their most pressing needs for immediate short-term wins, all the way through to untapping the hidden opportunities that drive long-term value.
CEOs are seeing the value of purpose in guiding their strategic decision-making. The next step for many is to connect the dots to drive more substantial change across the whole business.