Leading with Purpose
Deloitte in its report Purpose Strategy, leading with purpose defines four steps to implement purpose as strategy to meet the expectations from all the involved stakeholders, from employees and leaders to the communities where the company operates.
Assess Impact
Understanding the positive impact as well as the possible tensions with what is good for society from the company´s operations are the basis of implementing purpose strategically and successfully. The clarity on why society should want the company to succeed will allow the leaders to communicate and make decisions accordingly. Beyond the CSR departments, the focus on social and environmental issues and its impact on the business should be integrated into the core business processes. This integration promotes investments and actions consistent across the company reinforcing returns for the company and its stakeholders.
Amplify benefits
From the strong foundation provided by the clarity of the company´s impact in its environment and lean processes to act consistently across the company, the business leaders will need to define the areas of focus. This strategic decision should consider both the issues where the company can influence meaningfully and where the company is expected to lead. Since multiple companies in the same sector may commit to the same issues, the leaders should commit to be the leaders on their focus areas to remain competitive.
Act consistently
Once companies have embraces purpose as leading principle, it is critical that the leaders articulate the values, evaluate the processes against the values and act if discrepancies arise. Without consistency across all business processes in the company, the company exposes itself to backlash. This also will require additional robust processes to identify, evaluate and manage tensions over time.
Differentiate impact
Business strategy should meet purpose strategy to avoid that the purpose activities are clustered in isolated CSR activities. Purpose strategy understood and developed in the first three steps should then be in alignment and service of the long-term value for the company and society. The data suggests that the social innovation that is profit driven can deliver superior shareholder returns. Philanthropic and corporate citizenship activities like volunteerism will continue to be important, but will not be the drivers of company´s impact. All those current activities will then be incorporated in the broad efforts of purpose strategy that articulates all the process of the company consistently. Thus, purpose can enable the companies to outperform the market at the intersection of sustainable business value and impact on society.
