Transforming Work Part 4: Purpose Over Profit

By on August 14, 2015

(This is the 4th article in a series                                                                                                                                                        on the mindsets of  workplace transformation.                                                                                                                         Click to go to Part 1, Part 2, Part 3)

 The fourth mindset shift is one that leaders and employees at all levels desire, but have trouble sustaining – the shift from a focus on profit to a focus on purpose. The importance of purpose is very familiar to Japanese culture, where the concept of “ikigai” which translates as life + value is a central part of a life well lived (See my past article on Ikigai and Aging Well for more.), but leaders have been traditionally hard-wired to focus on finances as the ultimate driver of business health.

The following research supports why cultivating purpose is an essential for building and sustaining long-term business success.

Purpose increases profits:

A new study from Deloitte confirms that organizations with a “culture of purpose” outperform those that focus on pure profit. The study of 1,310 U.S. adults found that 90% of people who worked in organizations with a strong sense of purpose also reported strong financial performance, employee engagement and customer satisfaction. In contrast, 65% of those in organizations without a sense of purpose reported low financial performance.

Purpose attracts and engages employees:

70% of Millenials say they want purpose at work (From Purpose to Impact: Harvard Business Review, 2014) but attracting talent is just the first step. Even more important is the fact that purpose quadruples the likelihood of being engaged at work (Gallup/Healthways), and that companies with high satisfaction and engagement among their employees average 12% higher profitability (Source: Gallup Q12 Meta-Analysis).

Purpose attracts and retains high-paying customers:

92% of customers will choose a product that has a higher purpose when price and quality are equal (Nielsen, 2014). Even more relevant to business, there has been a 10% increase (from 45% to 55%) in the number of customers willing to pay more for a product that has a higher purpose.

Purpose improves mental and physical health:

A 2015 study by cardiologist Dr. Randy Cohan at Mt. Sinai Hospital reviewed 10 studies involving more than 137,000 people with an average follow up of 8.5 years indicated that those possessing a strong sense of purpose had a 23 percent reduced risk of death from any cause. Studies published in the Journal of Clinical Psychology as early as 1980 showed that a sense of purpose fights depression, and a 2014 study by Patrick Boyle, PhD even found that it decreases the onset of Alzheimer’s Disease by a whopping 240%.

It is becoming more and more difficult to debate that investing in cultivating a culture of purpose makes good business sense, even if you are driven by a profit motive. Unfortunately, while most high level leaders are well aware of the above research, they are falling far short in their ability to apply it. The Deloitte study reveals that while 64% of executives think the company has a strong purpose, only 54% of employees think the same thing. Further, 80% of Global CEOs admit to not knowing their purpose (Harvard Business Review, 2014), despite identifying it as a top priority for themselves (IBM, 2012).

How does a person start to make the shift?

The first step is to acknowledge where you are at. You are overly driven by the money mindset if the majority of your decisions prioritize making money, controlling costs, sticking to budgets, and minimizing expenditures. If your first question about any initiative is “can we afford it?” and you stop exploration if the answer is no, you are limiting yourself and your business.

The money mindset for decision-making is representative of fear, security, and scarcity. It comes from a place of trying to play it safe and not make mistakes. The history of successful individuals and organizations proves that this approach is misguided. You would be hard-pressed to find even one story that attributes their success or turnaround to playing it safe and trying not to make mistakes.

The purpose-driven leader asks the following types of questions before entertaining the question of money, profit, or finances:

  • Will this help us to better fulfill the organization’s true purpose?
  • Will investing resources in this initiative move us towards our vision more quickly, elegantly, or otherwise add value/quality to the journey for the players involved?
  • What is the anticipated real value (both financial and non-financial) of this investment for me, my team, the organization, our customers, and the world?

If the value is there, true leaders find the money, take calculated risks and accept that mistakes are a necessary part of innovation, fulfilling their purpose, and leaving a lasting positive legacy as a result of their work. By focusing on purpose over profit, leaders and entrepreneurs with this mindset are able to leap ahead of the competition and stay there.

If you are keen to tap into the power of purpose in your life, work and business, go to www.kyoseiconsulting.com and download our free workbooks on discovering your personal or business purpose.

About Andrea Jacques

Andrea Jacques is the founder of Kyosei Consulting and the author of Wabi-Sabi Wisdom: Inspiration for an Authentic Life (available on Amazon.com). She has spent more than 20 years developing the potential of people and businesses worldwide, five of which were in Japan. A dynamic speaker, coach, and facilitator, her work integrates spiritual insight with top-tier leadership, wellness and sustainability consulting to help individuals and organizations build thriving, purpose-driven cultures where employees know their work truly matters. She can be contacted through her website at www.kyoseiconsulting.com