Lately, all the cool kids have purpose. Progressive companies tout their purposes on their websites, and chief executives talk about the greater good impact their businesses have on their customers and the world.
The question is: How does an aspirational purpose stand up to the demands of daily business?
For many firms, the answer is not very well.
Research from EY Beacon Institute showed more than one-third of employees (35 percent) observed a disconnect between their organization’s stated purpose and its day-to-day actions. The researchers’ report cited a “persuasive overconfidence bias that leaves leaders viewing their company’s commitment to purpose far more optimistically than their employees.”
This is a dangerous space for a company to be. When leaders put forth an aspirational purpose, yet their day-to-day actions reek of the self-serving transactional, organizational backlash is often the result.
If a purpose-driven narrative is incongruent with daily behavior, it first shows in one of three places:
1. Sales teams
Nowhere is a disconnect between purpose and daily actions more obvious and more dangerous than in a sales team.
When a sales team believes leaders are simply giving lip service to a customer-focused purpose instead of truly living it, morale suffers. Salespeople become transactional. They’re more likely to cut corners, provide lackluster service and game their incentive plan than focus on lasting customer value.
The challenge for sales leaders is to combine the aspirational (purpose) with the urgent (quarterly targets). Transactional leaders focus on when and how they will collect revenue. Purpose-driven leaders address revenue collection but they also ask, “How will this sale help the customer?” They demonstrate a leadership commitment to lasting value that extends beyond internal sales targets.
When the chips hit the wall, are we here for ourselves, or are we here for our customers? Think back to what happens in your own organization when revenue falls, or a market declines. Does the leadership team double down on serving customers? Or do they abandon purpose in favor of short-term thinking?
Purpose-driven leaders avoid this trap. They take fear off the table by pointing their teams toward something bigger than themselves. Transactional leaders are more likely to overemphasize internal-based reduction thinking. This creates silos and finger pointing in times of crisis.
3. Employee policy
If your noble purpose is to better the lives of your customers and your community, yet your internal policies and benefits reek of greed, don’t expect a pat on the back from your workforce.
Take Walgreens, for example. Its purpose is to “champion everyone’s right to be happy and healthy.” Yet, just last year they cut health insurance benefits for retired employees and continue to sell tobacco (unlike competitor CVS).
If the operationalization of purpose fails to address the three above areas, performance suffers. When employees spot a disconnect between what leaders say and what leaders do, they become disengaged and mistrustful.
Instead of benign, the organization seems inauthentic. Instead of indifference, employees feel anger.
As someone who works deeply in the purpose space and the sales space, I believe most executives are sincere in their desire to create a more purposeful work place.
The disconnect between purpose and daily actions does not happen by design, it happens by default. Bringing purpose to life requires new architecture and lexicon, one not second nature to most leaders, who have been training in a more financially oriented transactional system. If you want purpose to become part of your groundwater and get the benefits from it, look at your words and your actions.
– Lisa Earle McLeod is a leadership consultant and the author of several books. For more information on her company, visit McLeodandMore.com.