This amazing piece of research by HBR and EY is a great 15 min read, best to skim through while sipping a cup of hot coffee. This research underscores the challenges companies face and the benefits companies see when they make purpose a priority. It surveys global business executives about the extent to which purpose is utilized by their organizations—and, importantly, the impact that it has
upon their ability to grow, innovate, and transform.
The results demonstrate that companies who clearly articulate their purpose enjoy higher growth
rates and higher levels of success in transformation and innovation initiatives. Furthermore, it explores the possible reasons why only a minority of companies are using purpose to drive their decision-making processes.
- Companies are categorised into three categories when it comes to purpose: Prioritizers (clearly articulated and embedded purpose), developers ( In the process of embedding purpose), and laggards (purpose was not understood or communicated).
- Although 90 percent of executives surveyed said their company understands the importance of such purpose, only 46 percent said it informs their strategic and operational decision-making.
- Purpose—or the lack of shared understanding of purpose—seems to have a direct impact on the bottom line.
- Short term shareholder pressure, systems and infrastructure that are not aligned with long term purpose, lack of performance targets and incentives aligned with purpose and poor communication across the organization are the main barriers that hinders the integration of purpose into the company’s strategy.