‘Must purpose be good?’ It’s a summer evening in a Victorian library in the Science Museum in London, and I’m on the panel at a seminar called ‘Purpose Matters’, organised Hall & Partners, the research agency. Of all the questions we’re asked, this is the best.
It made me think hard about this ubiquitous buzzword ‘purpose’. Every company seems now to have one. There’s even a book now called The Purpose Economy. But has the idea become valueless? Is it just management feelgood? Once we’ve defined our purpose, can we all sit back and congratulate ourselves? Is ‘purpose’ just the latest version of ‘vision’?
I’m a believer in purpose. I’ve always felt organisations do better when they have a purpose beyond profit. And it’s always been in the DNA of Wolff Olins: we’ve always wanted to help our clients make the world a bit better. But a few recent things have got me worrying.
First, does purpose really help in external communication? When British Airways started using its purpose explicitly in advertising – ‘to fly, to serve’ – its low-cost rival EasyJet countered cheekily with ‘to fly, to save’ – which neatly captured what people actually want. So is purpose always a turn-on for customers? No.
And some of our younger digital client companies are just puzzled when we push them about their purpose. We don’t need a purpose, they say, we just need to be clear what our platform helps our users to do. So is purpose always essential to get a new product off the ground? No.
Second, is purpose powerful enough inside organisations? Tesco, like many companies that have been hit by criticism recently, has defined a purpose: ‘to make what matters better, together’. But as a customer, can you feel it in the stores? No. Is it helping the company grow? Judging by last week’s sales figures, no.
Several of our clients have excellent purposes, and believe in them, but everyday life gets in the way. Under shareholder pressure, managers understandably go for safety, sameness and revenue, rather than risk, difference and principle. So does purpose – even in those organisations that believe in it – drive decision making? No.
What this all implies is that purpose, on its own, is not enough. And in fact purpose statements, on their own, don’t motivate people, any more than vision statements used to. Mantras help, but it’s the climate that surrounds them that makes the difference.
Externally, purpose needs to become softer, broader, more diffuse: a climate that you could call attitude or angle or even obsession. Unilever’s excellent Jane Buck, a fellow panellist at the Science Museum, calls it ‘point of view’, like Persil’s view that dirt is good. It’s something you can share with customers rather than throwing it at them. It might even be a question you debate with customers.
And internally, purpose needs to become harder – an honest operating principle, or a bunch of them. We can still learn a lot from the Quaker companies, like Cadbury or Clarks, whose founders weren’t philanthropists but tough businesspeople who saw purpose and profit feeding into each other, in a virtuous circle. Organisations now need to talk explicitly about the ROI on ‘purpose’, and to help their people make decisions that are neither idealistic nor rapacious: decisions that make money by making a difference. And if your goal is simply to make money, that’s fine: that’s your purpose.
So the answer is purpose doesn’t have to be good. Externally, it’s not a great idea to boast about your high-minded purpose, about how good you are. And internally, it doesn’t work to pretend to be driven by goodness, to be a kind of NGO, when you’re a profit-making company. Purpose isn’t enough: what’s your point of view? And what are your operating principles?
Robert Jones is Head of New Thinking at Wolff Olins and a visiting professor at UEA.
The Wall Street Journal is reporting that today is ’Starbucks Gun Owners Appreciation Day’. But interestingly, Starbucks had no part in planning or organizing this event and in response, has issued this statement to the press: “These events are not endorsed by Starbucks. Our stores are gathering places for the communities we serve and we respect the diversity of our customers.”
Still, I wonder how many people will have their perception of Starbucks jolted a little – for better or worse. How many people will just see a tweet or headline and conclude - as I did initially- that Starbucks is encouraging gun ownership instead of the reality—that a group of gun owners is publicly expressing their appreciation for Starbucks?
Whether they choose to participate or not, brands are increasingly involved in debates around sensitive political and social issues that may not directly relate to their core business. Having a strong sense of purpose and a solid set of values is the only way for them to know when and how to participate in the discourse. But even then, of course, sometimes associations are simply beyond their control entirely.
You’re an entrepreneur. You’ve identified a gap in the market and come up with a product with huge potential for growth. The problem? You’re not the only one.
If everyone is trying to solve the same problem, then what’s going to make you stand out and be different? This is a tricky question for startups to answer, as you do not have the same history and heritage to draw from as the Nikes, GEs and Microsofts of the world. It’s a future-facing question that requires you to think about the principles that make your business special and unique.
Your principles should come out of your purpose – your reason for being. They should be equally inspiring and strategic. They should get you up in the morning, but also act as a guiding compass that drives decision-making. They should define your product experience, company culture, and communications.
Skillshare is a great example of a startup that has created set of principles that clearly define what makes them different. There are many wonderful startups that are trying to re-think education, from the Khan Academy to Coursera to the School of Life. What makes Skillshare different from its competitors is its commitment to principles that include “everyone is a teacher”, “teaching isn’t what you think it is”, and “learning by doing.”
Startups in other industries could learn from Skillshare’s example. I recently was on vacation in San Francisco where rideshare services are all the rage. Lyft. Uber. Hailo. Without googling them, I’m unclear on the differences between these businesses. I know that one has a pink moustache on its cars, but that’s the extent of my knowledge.
The issue of differentiation goes beyond transportation; it can also be applied to startups in crowdfunding (Indiegogo v. Kickstarter), ecommerce (Gilt v. Myhabit v. Rue La La), travel (Kayak v. Hipmunk). The list goes on.
You might be first to market, but defining what makes you special becomes especially important as your industry becomes more complex and competitive.
Where failure is the rule, not the exception, it’s important to start thinking about this question now rather than later.
Melissa Andrada is a strategist passionate about creating businesses that inspire people, do good, and make money. In her spare time, she teaches classes on branding for startups at General Assembly. @themelissard
Reg Dean died peacefully two weekends ago. He was believed to be Britain’s oldest man at 110 years and 63 days. His philosophy on life was to “always look for the best in people, and never do a task for reward or prize – always for the best intentions”.
Rather progressively for the times, he was a vegetarian, and believed we should all have a faith “of whatever religion, that we can trust and rely upon”. Since before Socrates, we’ve been examining what constitutes a life well spent. It’s a good question to ask ourselves, and before we run out of time to do much about it.
At Wolff Olins we talk a lot about purpose – of spirit, endeavour and action – for companies and for individuals. It gives us passion, informs our work, how we relate to one another and how we measure our success. If you’re still looking for a New Year’s resolution for 2013, why not make it to find your purpose and to help others find theirs.
Members of Parliament (MPs) in the UK have been recently highlighting the exploitation of a tax loophole by some of the best known brands in town. Amazon and Google are among those companies to have taken advantage of EU tax law to sell digital ‘services’ (the classification for products delivered over the internet, such as ebooks, MP3 downloads and mobile apps) in the UK whilst paying minimal tax in HQ-haven Luxembourg.
Perhaps MPs are simply glad to have the spotlight shine on somebody else’s accounts but this kind of publicity highlights again how, as we learn more about how companies conduct their business, so we consumers can hold them to account by voting with our feet, or as is increasingly the case, our fingers.
This is not a new phenomenon; clothing brands such as Adidas, Nike and Gap have long been the target of campaigns seeking to highlight factory conditions in their supply chains. Yet as the information explosion around us gathers pace, so does our awareness of the practises of the brands we decide whether to buy from. With the growth of social media, we find out the news faster than ever before. Often we are now the ones reporting the news and we are having more and more conversations about the brands we love (or don’t). We have drawn the brands in (or perhaps them us) to a closer relationship. They know far more about us and conversely, us about them.
In question here are some of the most successful, tech-enabled brands of recent times. They prove their usefulness to tens of millions of us each and every day. It will therefore be an interesting test of our loyalties to see what impact this episode has. It is too early to say what this will be, although online-sales figures for John Lewis’ suggest they have reaped a benefit at Amazon’s expense, whilst Starbucks has been worried enough to voluntarily hand the taxman an additional £20m in revenue.
Traditional marketing has long made the most of the separation of image and reality to tell the stories that companies wanted to tell and, in fairness, those that consumers wanted to believe. Yet in a marketplace with what an economist might call ‘perfect information’, where everyone knew everything about every company/organisation’s operation, image and reality might just become one and the same.
So the question seems to be to what extent the world converts this increased transparency into greater accountability for business. Something that seems a precondition for brand to stand always for reality and not simply image.
If we can edge ever closer to this scenario, the brands we trust will be those who deliver the goods with nothing ugly hidden behind their backs.
Dylan Parry is a project administrator at Wolff Olins, he also produces ‘Because’, our fascinating series of talks about inspiration and where it comes from.
Wolff Olins is in many ways a child of the 1960s. Among other things, that means we think our work should have a positive social impact as well as a commercial one.
Indeed, we think that it’s through providing a social impact (getting good things to more people) that you best achieve a commercial impact (revenue and growth). This is in contrast to the prevailing view that a positive social impact usually comes at the cost of a negative impact on profits.
Over the years, we’ve achieved this kind of thing with commercial clients like GE and Tata DOCOMO, and with social enterprises like (RED). More and more, we believe commercial enterprises should have a social purpose. And that, conversely, social enterprise should generate profits.
But how exactly does that dynamic work?
We’re collaborating with the Young Foundation to try to map this out. In advance of a conclusion, here’s my first go. Improvements to the model welcome.
Robert Jones is visiting professor at University of East Anglia and Head of New Thinking at Wolff Olins.
Nearly 60 million Americans affected by Hurricane Sandy are still dealing with its physical and economic destruction. Here in NYC, we’ve been inspired by people’s and organizations’ resilience and willingness to help each other. Brands, too, are helping out in the aftermath, altering their behaviors, protocols, and models to privilege purpose over profit in this time of need.
Both The Wall Street Journal and The New York Times were quick to lift their online paywalls as Sandy approached, valuing their audiences’ access to information above all else.
MTA pulled a similar move, running free transit for city residents, wherever transit has been possible.
The car-service booking app Uber at first took a wrong turn, by surging their prices in New York, but they soon made a wiser decision to drop their pricing scheme and instead fill a need by increasing the number of drivers they had on the road.
Airbnb, a social business dedicated to helping people find space in a pinch, was able to quickly adapt its infrastructure for good. The company waived all of their fees on apartments and homes near hurricane-affected areas. They also sent a note to their community urging property renters to reduce their charges during this period.
Chase Bank opened the doors of its 41st street branch to anyone so they could use the bathrooms, charge their electronics, and rest. NYT said it unexpectedly became something of a “tourist attraction.”
In a clever act of compassion, Duracell set up a “Rapid Responder” truck which gave people free batteries in Battery Park. Apple set up charging stations in its NYC flagship store. And it was a common scene to see groups of people huddled up against Starbucks windows to access their free wifi.
REI, whose mission it is to supply the rugged and adventurous, had a free bike tuning and repair station in front of its closed Houston and Lafayette location so anyone on two wheels could stop to fix a flat or tighten a loose chain.
And Home Depot, built to provide the DIY customer with materials and know-how, has coordinated with FEMA and Red Cross to aid in pre-storm and post-storm relief efforts from their Disaster Response Command Center.
Last week, fees were temporarily lifted, banks were transformed into social centers, and help was brought to the street. It is one thing to lead with a concrete brand purpose, but these brands brought it to the next level, flexing their resources in inventive ways to be purposeful when it mattered the most.
Were you moved by other brands this past week? Let us know which in the comments below.
I spent Monday at TechCrunch Disrupt, one of San Francisco’s most anticipated technology conferences this year. From all the outstanding big guys and startups, here are three points that stood out to me.
1) BEING A “FOUNDER” DOESN’T JUST MEAN BEING THERE FROM DAY ONE.
Jack Dorsey, the creator of Twitter and founder of Square told his audience that he originally wanted to be an artist or a tailor – he never planned to be an entrepreneur.
He says a founder doesn’t need to be someone who was there from the beginning … companies have multiple “founding moments,” so it’s the people who have impact at those moments who should really be considered founders. ”A founder is not a job. It’s an attitude, it’s a role, it’s an idea that can happen again and again and again.”
His example: “Marissa Mayer – is a founder of Yahoo, she has the drive, moral authority and ability to change its course.”
Dorsey’s inspired by the founding fathers’ vision of a more perfect union—A strong philosophy that you need to be constantly open to change, recognize that work is unfinished, undefined and often wrong. We’re with him at Wolff Olins, we’ve termed that living in perpetual beta.
2) USEFULNESS IS A TERRIFIC MARKETING TOOL.
Airbnb founder Nate Blecharczyk told us that at his company they don’t think about the competition, they just think about what the need is, and how they can create a direct response to that need.
And so it was they started at the Democratic National Convention in Denver in 2008 –they knew there would be a shortage of housing available and got a primetime CNN video interview to spread the word about their solution.
Also at the conference was John Zimmer, from 11-week-old social ride-sharing service Lyft. He’s focused on word of mouth, iconic pink mustaches, and the sheer usefulness (and timeliness) of his new service to get the word out. Lyft is a real-time ride-sharing community that lets passengers request a pickup and instantly get a cheaper, safe and friendly driver to help them. It has worked for over 10,000 users already! And people all over the San Francisco are talking about those pink mustaches on what is apart from that a normal car.
3) TECH + PURPOSE MAKE A FRUITFUL UNION.
Corey Booker (@CoryBooker)– Mayor of Newark, NJ, perhaps an unlikely guy to encounter at a West Coast tech conference, was another one of my favorites. He has embraced all forms of social media to reach out, communicate with and hear from his community. He told the audience “technology has to have purpose, be mission-driven. It has the power to bring excellence to scale.”
He said “Martin Luther King would be a big user of Twitter.”
Booker is also behind Waywire – an alpha app which allows citizens to create and share their own newsrooms and wires.
Helen Jones is a senior account director out of San Francisco.
The book that first got me interested in the whole idea of management was Tom Peters’ In Search of Excellence, and one of its mantras was ‘stick to the knitting.’ But is that still good advice, 30 years on? Kodak, Xerox, Nokia, Kmart and Blockbuster all did, and look what’s happened to them. By sticking to their core activity, they failed to react to rivals coming from somewhere else. Google, on the other hand, has moved from its original search-engine knitting into every other handicraft, including self-driving cars.
We explored this topic at a breakfast discussion I hosted last week, exploring our view of the five habits that make 21st century businesses game-changing – which include ‘experimental’ and ‘value-creative’, by which we mean constantly searching for new strategies and revenue streams.
It’s also the topic of Repeatability by Chris Zook and James Allen, two consultants from Bain & Company. They say, in contrast: identify your core, simplify it, and repeat it.
So who’s right? We asked our excellent breakfast panellists came from Zipcar, Zopa and Google. Their view was that experimentation has always been important, and that the Internet now makes it easy to test new things very rapidly, with a huge population of testers. They believe that this kind of testing is natural to a 21st-century business, and that it’s so common that fear of failure – indeed, use of the word ‘failure’ – hardly exists any more. They also say that open experimentation – trying things out in the marketplace – is a great way to be transparent, to involve customers, and so to earn trust.
Where they differ depends on the life stage of their business. In the early years, they say, experiment around the edges until your core idea is proved, but stick to the core idea. ‘It’s a big enough battle,’ said one, ‘to establish our model’. In older age (and Google is a geriatric 14 years old), it become OK to experiment more widely and more radically. ‘Google is always in beta,’ said a panellist.
All three panellists, though, agreed that fruitful experimentation needsto be driven by a purpose. And that purpose can be hugely ambitious: Zipcar has its eyes on the day when there are more car sharers than owners, and Zopa on the moment when peer-to-peer loans outnumber bank loans. Zipcar, Zopa and Google all want to change the world for the better.
So maybe the answer to the conundrum is that Tom Peters was right. You do need to stick to the knitting – but don’t think of your knitting as your activity (which should change over time), but your purpose (whichshouldn’t).
"Change the way we shop forever." It’s a big idea, but can it really be done? Marks and Spencer seems to think so.
We know that demonstrating social impact is a big deal for commercial organisations these days, but social commitments can be quite hard to pin down, often too intangible, somehow peripheral to the person on the street.
Quite a lot was made of Marks and Spencer’s Plan A when it launched in 2007, not surprising since their stated ambition is to be the worlds most sustainable retailer. For M&S, Plan A is “not only the right thing to do,” it is “the only way to do business.” The good news is that it seems to be working, and its remit has grown. There are currently 180 sustainable initiatives going on within the business under the Plan A banner – from treating suppliers fairly to being the first UK retailer to charge for carrier bags.
Of course, having the right partners in place makes a huge difference. The most effective commercial and social partnerships are between organisations who share a common sense of purpose. Take Boots and Macmillan Cancer Support – whose aim is to make cancer information available and accessible on every high street, or Orange and Rockcorps – bringing people together with a big dose of optimism for the future.
One of M&S’ highest profile partners in delivering Plan A has been Oxfam, and so far the most visible face of this partnership has been their clothes exchange, where you get a £5 M&S voucher when you take unwanted M&S clothes to Oxfam. But anyone who’s been watching commercial TV in the last week or so will notice that the partnership has been taken to a new level. This new level is called ‘Shwopping.’ Essentially it’s a scheme where you can drop your unwanted clothes at M&S, but it feels like something bigger.
Bigger not because it’s fronted by the new face of Plan A, Joanna Lumley (though it can’t really hurt can it?) Bigger not even because they’ve coined a new name for it. Like other names that seem to fit the zeitgeist (‘bromance’, ‘sexting’) the name ‘Shwopping’ is one part annoying and four parts catchily obvious. But if you’re trying to get people to do something new then giving that thing a name is a smart move.
The main reason it feels bigger is because it’s a statement of M&S’ bigger purpose beyond just profit – an ambition to fundamentally change the way we think about how we shop – but one which we can all contribute to really easily. And the way it’s presented is almost too easy to resist: from Joanna telling us that it’s as obvious as recycling bottles, to the ‘Shwop drop’ boxes in store tothe intuitive and interactive website with real time totalisers and step by step guides.
It’s a challenge for big businesses to make their purpose beyond profit visible in everything they do, in a way which fits with their day to day business rather than feels like an add on. It feels like M&S has raised the bar with this.