Consultants have made millions getting brands to find their ‘why’ statement, and brands that engage in this kind of process leave proudly claiming they are here to ‘make the world a better place’ on some level.
However, the trouble with all this ‘purpose conceptualising’ is that it hasn’t really shifted the dial on consumer trust or employee engagement – some of the very things it was designed to tackle. This is because purpose is only worth anything if it’s translated into meaningful actions and programmes. Most brands claim to want to make the world better, but is this really borne out by their actions, and do sceptical consumers and employees believe it?
Getting brand purpose to live meaningfully across an entire organisation is an ambition that still escapes most. For most brands, they tend to separate the ‘money-making’ part of their business, and the ‘doing- good’ parts of their business – with core functions like sales, R&D, marketing and/or retailing on one side, and CSR, sustainability and HR on the other.
The problem here is that these ‘doing-good’ functions tend to be the first to be cut when the money-making parts of the business are struggling, or business leadership changes. They are typically perceived as cost-centres, not value-centres, and as such are unsustainable. When the going gets tough, purpose is often an early casualty of ‘rationalisation’.
However, new thinking on turning brand purpose into meaningful actions has caused some of the world’s largest brands to re-think how their businesses work. With consumers increasingly looking for brands to ‘do good’ as well as run good business, the commercial world has started innovating around how these things can work in mutually beneficial ways. How can we create commercial value whilst delivering significant social value? This is a methodology called ‘Shared Value’.
This methodology has been pioneered by Michael Porter and Mark Kramer in the US, and is now practised by a growing number of businesses all over the world, including my own, Three Point Zero. Our belief is that some of society’s greatest challenges are indeed also some of our biggest market opportunities. Areas like Housing, Education, Health and the Environment contain huge unmet needs, and there are lucrative as well as helpful roles for brands to play.
One of my favourite examples of this is the building firm Carillion, who generated £27m of profit in 2014 through their global shared value initiatives. These innovations include creating less waste, using less energy and working better with local communities. Not only has this generated a great deal of commercial value for Carillion, it has made them more investable, and created a happier place in which to work.
Another great example is the engineering giant Siemens, who have created the ‘Curiosity Project’ in the UK. This programme is enhancing the quality of teaching in STEM (Science, Technology, Engineering & Mathematics) subjects for 5m young people to create more engineers, which are badly needed to help the UK engineering sector generate a projected additional 27bn by 2022.
Both of these are committed programmes. They not only represent tangible, measurable value for the businesses concerned, but are demonstrably good for society.
And this is the key – these are measurable programmes. They have clearly set objectives, they have KPIs, they have financial value attached to them. They can speak just as compellingly to shareholders and the board, as they can to individuals, to regulators, to the media, and to society.
By building purpose into clear, business-critical, measurable programmes, and re-thinking the role of business in society, Shared Value solves the challenge of the value of brand purpose, whilst making business a much more positive force.
And if your business can do good whilst flourishing financially, wouldn’t that be a good thing, for all concerned?