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PERSPECTIVE
Our research found that senior leadership teams have recognised the importance of a clearly defined purpose. In 2018, organisations have allocated resources to articulate their purpose, and 4 in 5 employees report that their organisation’s purpose is clear. However, this is still missing the mark—in addition to being clear, purpose must be articulated in an inspiring way. We found that employees need to see, hear, and feel the influence of purpose often in their employee experience. They also need to understand how their specific work contributes to purpose. Organisations must ensure that their purpose is made clear in employee and customer value propositions. An organisation’s purpose should permeate and be evident in all of its actions.

 

PURPOSE INDEX 2019
People long to connect to something bigger and more important than themselves. An organisational purpose should fulfill this longing. Our research demonstrates that Purpose must have five specific elements in order to maximise its effect: clarity, positive effect, differentiation, inspiring toward a collective goal, and motivation.

Yet, the data demonstrate that purpose is lagging worldwide; only 66 percent of employees worldwide feel a sense of purpose from their organisation. As the ‘why’ of organisational existence, purpose should be continually communicated, seen, and heard by all members of the company.

 

INTRODUCTION
Purpose is your organisation’s reason for being. The difference you make in the world—why your company exists. Ask yourself this: What would go missing if my organisation ceased to be?

Employees innately desire to connect to something bigger, something more important than themselves. Most don’t come to work just for a paycheck. They don’t work passionately towards a goal that is only about profit maximisation. They come to make an impact, help others, and change the world.

Purpose drives profits and business success. Ninety-one percent of consumers would switch brands for a similar but purpose-driven brand.1 Employees that find a meaningful purpose in their work are twice as satisfied with their jobs and 3X as likely to stay with their organisation and contribute to its success. Plus, purpose-driven companies out perform their peers in stock price by 12X.2

Purpose is different from mission, strategy, or values. Mission is what you do. Strategy is how you will meet your goals. Values are behaviors you want your employees to live by. But purpose is why you do all of these things. Your mission, strategy, and values are all subservient to your purpose.

 

“Profit isn’t a purpose. It’s a result. To have purpose means the things
we do are of real value to others.”
—SIMON SINEK

INSIGHTS
An uninspiring purpose

Our 2018 Global Culture Report finds only 53% of employees describe their company’s purpose as inspiring and say it speaks to them. 31% feel their company’s purpose is too generic and report that it is mocked. 33% feel their purpose is merely a reworked version of their competitors’.

This may be because employees are working for companies whose purpose does not align with their own personal values. But more than likely, it means organisations have work to do in refining, communicating, connecting, and reinforcing their purposes in inspiring ways.


61%


of leaders feel a sense of purpose at their organisation

48%


of individual contributors feel a sense of purpose at their organisation

46%


of employees hear about their organisation’s purpose at least weekly

58%


see reminders of their organisational purpose in their workplace

The Millennial and Gen Z generations, in particular, are drawn to organisations with a strong purpose. They are more likely to work for and stay with companies that have a clearly defined purpose and meaningful opportunities and are loyal to individual leaders with a strong sense of purpose. Sixty-eight percent of millennials say “changing the world” is a personal goal they’re working toward,3 and only 20% of millennial employees plan to stay for more than 5 years in companies where they feel profit comes before purpose.4

Our data shows Gen Z and Millennials have a higher sense of purpose at work than Gen Xers and Baby Boomers:

RECOMMENDATIONS & IMPACT
It’s not enough to just have a meaningful purpose. Employees must know what the purpose is, feel connected to it, and understand how their specific work and role contributes to that purpose— how they are individually making a difference. You must incorporate purpose into every interaction and experience employees have at your organisation. Our research found the four most effective ways to embed a meaningful purpose into workplace culture.

1.

Tie your purpose to your employee value proposition, customer value proposition, and social good.

Create a concise, easy-to-follow employee value proposition, and customer value proposition, that are aligned with and fulfill your purpose. Employees want to feel strongly connected to their customers. They want to see that their work makes a difference for someone in a meaningful way.

Articulate the difference your organisation makes and specify the unique aspect of humanity your organisation serves to your employees, customers, and the world. If you are a manufacturer of farm tractor equipment, you can say you help feed the world. If you are a hospital, you can say your purpose is healing. If you refine gasoline, you can say you help people travel to see the people they love. And so on.

We found when organisations tie their purpose to some sort of social good employees are:

120% more likely to believe their organisation positively affects the lives of others

64% more likely to believe their organisational purpose is clear

150% more likely to believe their customers would miss something if their organisation did not exist

54% more likely to report that their organisational purpose motivates them to do their best work

 

2.

Communicate it clearly and often.

It’s easier for employees to connect to your purpose when they experience it. Employees need to see and hear about your purpose often—during onboarding, in newsletters, town hall meetings, posters, emails, intranet, and from leaders. These communications become cultural focus points and opportunities for storytelling that reinforce your organisation’s reason for being. They also allow your purpose to be organically adopted by your employees, rather than just being pushed out by the company.

Our data shows that only 43% of employees see or hear about their organisation’s purpose at least weekly. But we also saw when employees see reminders of their organisation’s purpose throughout the workplace, they are:

32% more likely to believe that their organisation positively affects the lives of others

44% more likely to agree that their organisation has a clear purpose

30% more likely to believe their organisation inspires employees to work towards a common goal

 

And when they hear about their organisation’s purpose, they are:

26% more likely to believe that customers would miss something if their organisation did not exist

20% more likely to be motivated by their organisation’s purpose

When your purpose is harmonized with your employee value proposition, customer value
proposition, and tied to social good, the research shows there is a:

935%

increase in the odds that an employee
will have a sense of purpose

288%

increase in the odds that an employee will have a sense of opportunity

858%

increase in the odds that an employee
will be engaged

 

3.

Tie your recognition efforts to your purpose.

Your purpose should relate to your values, and your values should influence what you recognise employees for. Recognition needs to be specific and reference the outcome and impact of an employee’s great work. When employee recognition is tied to purpose, employees are continually reminded that they’re contributing to something bigger than themselves. Their work becomes more than just a job.

People also feel more connected to one another and the organisation when they are working towards one shared purpose together. Recognition demonstrates to each employee how they’ve contributed to the team and made a tangible difference for the organisation and it’s customers.


Employees are 121% more motivated to do their best work when recognition is tied to their organisation’s purpose.


 

4.

Connect the dots in one-on-ones.

Employees want to know that their particular contributions matter, how they are uniquely adding value to the world, and that what they are working on supports what matters most. How do they connect with your purpose? Consistent and frequent conversations between leaders and employees can keep organisational purpose top of mind. Leaders should use one-on-ones to tie the individual’s and team’s work to the purpose of the company and the value it brings to your customers.

Our study shows when employees feel they are doing meaningful work, there is a:

42% increase in feeling their leader supports them

52% increase in feeling successful

61 point increase in employee Net Promoter Score

49% increase in feeling highly motivated to contribute to company success

 

“Connect the dots between individual roles and the goals of the organisation. When people see that connection, they get a lot of energy out of work. They feel the importance, dignity and meaning in their job.”
—KEN BLANCHARD, AUTHOR, ENGAGED LEADERSHIP: TRANSFORMING THROUGH FUTURE-ORIENTED DESIGN THINKING

Already legendary for their employees’ passion for the outdoors and recommending just the right gear for enjoying it, outdoor retailer REI took their purpose to a whole new level with the #OptOutside campaign that began in 2015. By closing all their stores on Black Friday, they showed just how much they stood for quality time in the outdoors over sales. They even promoted hiking trails and other outdoor activities instead of shopping on their website. And what happened? REI hit record sales, donated a good chunk of them to organizations that align perfectly with its purpose, and inspired millions to #OptOutside.5

 

CONCLUSION
Don’t just lay the bricks. Build a cathedral.

Perhaps you’ve heard the story of two stonemasons. When the first is asked what he’s working on and how he likes it, he expresses that he’s laying bricks. When asked the same question, the second stonemason says he’s building a cathedral.

Or take the common tale of when John F. Kennedy asked a janitor what his job was when visiting the newly built NASA headquarters. The janitor’s answer? “I’m sending a man to the moon.”

Build the cathedral. Connect every stonemason’s brick to that purpose. Make sure your employees and your customers know what your purpose is. Why it matters. How your people uniquely contribute to it. And every time your employees experience something that communicates, reminds them of, and connects them to that purpose, they’ll work even harder to fulfill it.

 

PURPOSE—KEY TAKEAWAYS

• Align your employee and customer value proposition to your purpose.

• Communicate it, loud and clear.

• Tell employees how they uniquely contribute to your purpose.

• Recognize those who live your purpose.


Purpose Sources

1. Hayley Leibson, “The Power of Purpose-Driven”, Forbes, Jan 25, 2018.
2. Harvard Business Review, “The Business Case for Purpose.”
3. Sebastian Buck, “As Millennials Demand More Meaning, Older Brands are Not Aging Well”, Fast Company, Oct 5, 2017
4. Rosamond Hutt and Bilal Pervez, “Purpose or Profit: Which would give you more job satisfaction?”, World Economic Forum, July 28, 2016
5. Amanda Pressner Kreuser, “After Hitting Massive Revenue Numbers, REI Gave Nearly 70 Percent of Its Profits to the Outdoor Community. Here’s Why (and What You Can Learn)”, Inc., Feb 23, 2018.


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METHODOLOGY

Survey data collected and analysed by the O.C. Tanner Institute.

Qualitative findings are derived from 16 focus groups and 65 leaders among employees of larger companies and organisations, separated by gender. The groups were held in two phases: December 2017 and April 2018. Groups were conducted in Denver, CO; Minneapolis, MN; Toronto, CA; London, UK; and Sydney, AU. Each group represented a range of types of employers, including private companies, public companies, and government entities.

Quantitative findings are derived from online survey interviews administered to employees across Argentina, Australia, Canada, China, Germany, India, Japan, Mexico, Singapore, South Africa, United Kingdom, and the United States. The total sample size was 14,081 adults working at companies with 500+ employees. Fieldwork was undertaken between June 18–29, 2018.

This sample is sufficient to generate meaningful conclusions about the workplace culture of companies in included countries. However, as we do not have population data, results are subject to statistical errors customarily associated with sample-based information.

All figures, unless otherwise stated, are from the O.C. Tanner Institute.

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