In order to cultivate a successful business with happy employees, it is highly important to have a clearly defined purpose. Many businesses don’t have a true strategy when it comes to describing their purpose, choosing to fill in the blank with almost anything. Because many leaders have no connection with their outlined purpose, they aren’t capable of fully integrating it into their business operations – and employees feel less connected than ever.
Your company’s purpose is the reason you do what you do. It’s that underlying focus of what you hope to achieve all boiled down to a couple of sentences. Purpose is separate from your mission statement. It describes what value you intend to provide to your customers and guides you and your employees into achieving its true plan.
Defining Your Company Purpose is Crucial for Three Reasons:
1. Happy Employees = Productive Employees
An employee survey in a recent Harvard Business Review article found that only 28% of respondents felt connected to their company’s purpose. In addition to this, only 39% of employees said they could clearly see the value they create, while only 22% agreed that their jobs were fully leveraging their strengths. A mere 34% thought they were strongly contributing to their company’s success.
On the other hand, when companies had a clearly defined purpose, the positive results were obvious. In the same HBR study, 90% of Businesses that had a clearly defined purpose that resonated with employees saw growth and profits at or above the industry average. Furthermore, over 60% of employees for these businesses said they were motivated and/or passionate about their work, which was almost twice as much as companies that didn’t have a defined purpose.
90% of Businesses that had a clearly defined purpose that resonated with employees saw growth and profits at or above the industry average.
2. Happy Employees Lead to Customer Satisfaction.
Customer satisfaction is a popular motivator for many company purposes. The role of employees in building relationships with customers means that they should have a strong connection to the company’s purpose. If employees feel disconnected from their purpose, so too will the customers with whom they interact with on a daily basis.
Loyal customers are worth up to 10 times as much as their first purchase, meaning customer satisfaction has to have more than passing significance to your organization. Before even the profit of your brand, customer satisfaction needs to be of the utmost importance to succeed. It’s true that it’s more difficult to find new customers than it is to build up the loyal ones you already have. In fact, studies show that new customers can cost 5-25 times more than existing customers
Loyal customers are worth up to 10 times as much as their first purchase, meaning customer satisfaction has to have more than passing significance to your organization.
To emphasize it again, ensuring your employees are satisfied with what they do is the key to ensuring your customers are also happy.
3. Happy Employees Provide a Competitive Advantage.
An article on Gallup defines the competitive advantage that comes with a clearly defined purpose: “Establishing and operating from an anchor of purpose can create a competitive advantage: A company’s competitors might be able to replicate products and services, but that company can successfully differentiate itself from the rest by hiring and engaging employees who can fulfill and deliver its purpose and brand in the marketplace.”
“A company’s competitors might be able to replicate products and services, but that company can successfully differentiate itself from the rest by hiring and engaging employees who can fulfill and deliver its purpose and brand in the marketplace.”
Many articles and experts may encourage your company’s purpose to become the underlying factor that guides all your business decisions, however, it might be even more important to focus on its importance in the great scheme of long term success in order to distinguish you from competitors. If employees can associate their work with how it will align with the organization’s purpose long-term (in how they treat customers as well as how business managers treat employees and promote their actions with customers), then there’s a stronger chance of success.
How is Employee Recognition Important to a Company’s Purpose?
Implementing a solid employee recognition and engagement strategy is one of the first steps you can take towards motivating your employees to understand and connect with company purpose, as well as instilling and reinforcing core values.
When employees are recognized both from their peers as well as their superiors (and they’re able to recognize you back), the playing field is equalized, and your purpose becomes a driving force that’s just as important to the entire work team as it is to the business owners – and everyone, including your customers, want the company to succeed.
Are you interested in learning more about Online Rewards and how we can help establish a strong foundation for your organization’s purpose? contact us today.