There’s a lot of talk right now about inter-generational differences at work. But there’s one thing all ages have in common – business purpose is becoming a more important factor.
And for Gen Z the alignment between their values, the changes they want to see in the world and how the company they work for not only reflects these values, but embodies them too, is critical.
This is not a trend. It’s a fundamental shift in the forces shaping business today and into the future. And while purpose is one of many factors in recruitment, as salary still drives choice, what we see it that it is critical to retention.
According to the Deloitte Global Gen Z and Millennial survey, nearly two in five (37% of Gen Zs and 36% of millennials) say they have rejected a job and/or assignment based on their personal ethics. Nearly half (46%) of Gen Zs and millennials in senior positions have rejected a job and/or assignment based on their personal ethics.
Purpose is lived not laminated
But what exactly is purpose? You have a sustainability strategy. You’ve posted a statement on your website. That’s it right?
Sorry but no. Value statements are a blunt tool. Your mission and vision are often more abstract concepts. Purpose is a far sharper and more strategic way of transforming your thinking into behaviours and sets a higher agenda to align your organisation behind.
Purpose helps guide decision making throughout businesses with the aim of having a positive impact on the world as well as your bottom line.
And it matters to employees. The most critical aspect of retention is ensuring that employees feel you live up to your purpose promise. This matters whether you are 20 or 60. It’s a living, breathing set of every day micro actions that create a vital sense of trust in your business.
We recently did some research with YouGov that showed 69% of employees at large companies felt the organisation’s expressed purpose was conflicted, or only partially aligned, with their day-to-day experience. This is a retention problem waiting to happen.
But delivering against a purpose-led agenda isn’t easy. Right now, many businesses are still in the foothills of this change. And when people like Yvon Chouinard are signing away billion-dollar businesses to make ‘Earth [Patagonia’s] only shareholder’, it can feel daunting.
But there are concrete ways in which all organisations can close the gap between what they say and what they do.
Setting a new agenda
First, a shift is required to fully embrace the commitment not just to your employees, but a much broader stakeholder base about how you’re going to behave and who your business is set up to serve. This means thinking about your business not just as an engine for profit, but also a force for good.
A key challenge facing many is that ownership of the purpose agenda has until now often been adopted by one section of the business, usually marketing. Brand purpose (important distinction) is being used as a way to drive awareness of a company, but not create operational change or meaningful impact.
If you are going to truly embody purpose, its articulation, design and delivery must start at CEO level. It is down to leaders to model purpose in behaviours and decisions. Then they must communicate that and set objectives around it. These are the people your employees will be looking at and thinking – ‘does this match up?’
Making that shift at CEO level starts with embracing the idea that business is about more than financial health. Creating shareholder value can no longer be the sole pursuit of business leaders. Broadening your stakeholder base is a critical element of building more successful purpose driven businesses, but it requires a different way of measuring impact, different forms of governance and new ways of engaging employees.
Co-create your purpose
We recently worked with the John Lewis Partnership for instance. It was one of the first purpose-driven businesses, set up over 100 years ago by a man who created a business structured around his employees, or Partners.
But a century later, John Lewis Partnership recognised that retail – and the needs of their Partners – were rapidly changing. They needed to update their purpose – not just for today, but for the future.
The key ingredient was the co-creation of this updated purpose. It is an approach we use in all purpose projects. For employees to be fully invested in bringing the idea to life, they must be consulted, engaged and bought into the work: what they think, what they value, how the idea should be delivered practically.
Regardless of the size or structure of your organisation, a co-created approach to purpose allows for a diversity of viewpoints, creativity and critically the expertise of those who will be charged with delivering the change.
JLP is a huge organisation, so to ensure meaningful engagement, we created an online platform where views could be expressed, ideas developed and perspectives shared. By doing this we were able to identify what mattered and how Partners saw the opportunity for the future. Then we worked at board and executive level to design and refine an idea that worked specifically for them.
The next stage was about taking an abstract idea and making it real. We worked on operational structures to deliver to, measurement systems, and decision criteria for employees to use to ensure their actions aligned with purpose.
Communications-wise, it was also important to create signature actions the business could take to demonstrate their commitment to their people, and tell effective stories throughout the business because narrative certainly shapes culture.
John Lewis Partnership is now prepared for the future with a co-created, and crystal clear, sense of purpose.
The future of business
Embedding purpose into your business creates a long-term return by de-risking it against inevitable regulation. We also know that purpose drives bottom line success. [High growth brands (10%+ growth annually) are 66% more likely to see purpose as a means to guiding employee decision making (Deloitte).
Externally too, consumers are also becoming increasingly vigilant about buying into businesses that share their values. And in categories with increasing regulation, soon many businesses will be forced into squaring off profits with social and environmental impact.
