Creating an inspiring business purpose
Successful businesses have a higher purpose, one that stretches and guides them through changing times; one that aligns and galvinises their culture, and keeps them striving for better.
Economist Milton Friedman famously said that “the social responsibility of business is to increase its profits”. Of course, value creation is an excellent measure of business effectiveness, although the moment of truth comes in how that value is shared between stakeholders. Does it all line the pockets of shareholders, or is it more evenly distributed between everyone inside and out, both financially and in terms of future investments?
Most entrepreneurs have a bigger ambition than their exit strategy, and most business leaders are driven by more than money, of which they are already well compensated.
Yet too many organisations, particularly large corporations seem happy to pursue the commodity of money. Legally executives are employed to create the best long-term return for their shareholders, and this can be an incredibly useful metric to guide decisions and measure performance. But it misses “the why”. The why this organisation is likely to create a better return than another, and the why people as employees and customers will care …