What can we learn from companies who have endured successfully over many decades?

September 12, 2020

A lot of companies, big and small, are struggling to survive in the current circumstances. With the second wave of covid-19 in India, economic activity has been massively impacted again in a space of less than a year. And it is understandable why it is very difficult to focus on business with what is going on around us.

However, it is probable that we will continue to find ourselves in this situation for sometime in the future. It might be a few weeks (hopefully) or even a few months or years before any normalcy is restored. There is a high probability of an economic crisis in the near future. I am not going to quote any data figures here but I am sure you know atleast one person in your immediate circle who have lost their job or their businesses have been severely impacted by the pandemic.

Companies have to find ways to provide value and generate revenues for the sake of all their stakeholders.Economic deceleration has both a visible and an invisible impact on the quality of life for millions of people in any country and especially a country like India. In this article I examine the role of getting in touch with your company’s core purpose to ensure you are starting to drive your revenues and cut down on the steady losses you might be facing.

To do that, I want to address the larger question of how can you find your company’s purpose in the first place?And your company’s purpose has (in most cases) nothing to do with that vision or mission statement that you have probably created. And it is a very high probability that your company’s purpose is probably unknown to everyone in the company.

We usually think of a company’s purpose in the following ways:

  • A lofty ideal
  • Connected to something good
  • Maybe something that society approves of
  • The Reason I am selling my products or services
  • a life altering event that happened in my life that made me start my business

Yes, it could be possible that your company’s purpose is infact to be found in any of the above points. However, the mistake that we make and why an overwhelmingly large majority of companies have no idea of their purpose is because they search for it externally. In a good case scenario, they think of a purpose that they like and try to fit it onto the organization. In a bad case scenario, which is also very common, companies create a purpose statement and forget about it.

In my experience, purpose is to be found in the most obvious of places and the place where we are generally not looking at. I will say something radical here and that is: ‘in every organization on this planet, there already exists a deep sense of purpose’. It is the reason why people in that organization get up and come to work everyday and it is beyond money and just basic survival. It could be to do with what people in that organization do with their money they earn but it is never just rational. It is palpable in any organization, it is usually unspoken and seems abstract but it brings people together even if very briefly.

I am reading a book by Markus Kramer called The Guiding Purpose Strategy and he talks about successful luxury brands who have recognized the power of purpose. They have oriented the organization around their intrinsic purpose, something that has always existed in their organization. In most cases, luxury brands are oriented around makers / craftspeople who have a deep passion and commitment to what they are painstakingly creating. That is one of the reasons why a lot of luxury brands are still relevant in the age where so many fortune 500 companies have very short lifecycles.

Take a look at the about page of one of the oldest luxury brands in the world that is still thriving today — Hermès

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It is basically talking about 2 core things that is intrinsic to it and naturally becomes a purpose that everyone in Hermès orients around — Artisanal model and humanist values.

Let’s take another enduring brand that is not a luxury brand which is still thriving and will probably continue to thrive after many of us are long gone — Tata Sons.

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While JRD Tata framed the governance philosophy in 1973, it was not a created one or something he found externally. Tata was already doing this in practice over the last 100 years.

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Dupont has faced the Great Depression, world wars, large anti-trust actions against it and gone through every concievable crisis you can think of but it has always rallied around its core purpose which is transformation through scientific and technological innovation. As of 2019, only 52 of the original Fortune 500 companies are still on the list. More than 50% of the original Fortune 500 companies are not even in business. Dupont is still on that list and thriving.

To conclude, you will find your company’s purpose within. Some questions that you can ponder over to start getting in touch with your company’s purpose:

  • If I look at my team, what is it about what we do that really inspires the majority of my team?
  • If I ask my clients, what would they say is something that they find inspiring about us? (you can also actually ask your clients)
  • (If you are the founder) What really drove me to start this company?
  • What about the work that I do is something I am really proud of?

Once you are in touch with your company’s purpose, it is not hard to even completely overhaul your business model to adapt to the current circumstances (if required), sometimes even overnight. What stays constant is the purpose and not the model or the products or services you are selling now. I will go so far as to say that companies who are going under or have already done so are disconnected and not aware of their purpose.

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