We are at a unique inflection point in history. More than ever actions speak louder than words. Organizations are being judged by how they are responding to their stakeholders during the pandemic– their employees, customers and communities thoughtfully and with caring. Helping them make swift and effective actions, many companies are following their values and their purpose for guidance.
Before COVID-19 and the racial justice movement, declarations including the Business Roundtable and the annual letter from the world’s largest asset manager heralded a new era focused on all of a company’s stakeholders, not just shareholders. Organizations are demonstrating their purpose – an organization’s reason for being beyond profits - with increased employee loyalty, enhanced recruiting, sales growth and impact on society. This proven business and brand strategy is being highlighted by board members and marketers alike.
Concerns persist that the unprecedented economic downturn could cause backsliding with purpose abandoned as a “soft” issue. However, research indicates that authentically placing purpose at the forefront is a resilient strategy. COVID-19 has seen hundreds of companies who had previously positioned themselves as purpose-driven corporate citizens stepping up to support their employees, their communities, front-line healthcare workers as well as small businesses on whom they often rely for goods and services both at work and privately.
This imperative to respond authentically and with empathy is backed up by research indicating that consumers' opinions are being shaped by how a company is responding to the pandemic. This is true both for B2C as well as, B2B enterprises which are increasingly visible as their role as essential links in the global supply chain comes to the forefront.
Now is the time for the B2B sector to re-imagine purpose.
The B2B Purpose Paradox Report, developed in collaboration between the ANA, Carol Cone ON PURPOSE, and Harris Poll, found that prior to the pandemic, 86% of B2B companies had a stated purpose.
Yet, although nine out of 10 respondents said purpose is important to their business, less than a quarter said purpose is embedded in their business to the point of influencing culture, innovation, operations and their engagement with society. In other words, there is a significant gap been Stated Purpose and Activated Purpose. This is the purpose paradox.
For most organizations, purpose is a tagline or quasi mission statement rather than a strategy for business and societal impact.
Companies that have activated purpose have done so internally to impact behaviors, operations and innovation. When faced with the unprecedented challenges of recent months, activated purpose provided an enormous advantage, supporting appropriate, genuine and agile responses.
Purpose and the Pandemic
B2B Companies with a strong sense of purpose have been able to respond more quickly and effectively to the crisis. A few examples:
Lineage Logistics, a cold storage, food transport and processing company, launched the Share a Meal campaign to provide 100 million meals to Americans in need. Their CEO made clear that now is the time for the company’s purpose to come to the forefront. The company relied on its deeply embedded understanding of purpose to maintain employee motivation as they worked to ensure their essential role in the food supply chain was not disrupted.
Construction equipment company Caterpillar made an $8.5 million donation to underserved communities. They are also is using their capacity to provide equipment and resources to hospitals, medical staff and patients and is focusing on their local communities to give back in “our own backyard,” including donating meals.
Harbor Freight Tools, a retailer that serves many small businesses in the construction and contracting industry, donated its entire inventory of PPE to medical centers and healthcare workers, shipping more than 45 million supplies to hospitals in 1,000 communities nationwide
De Beers, one of the world’s largest diamond mining companies, is making efforts to ensure the communities in the African countries where it operates many of its mines are able to acquire vital medical supplies, food, water, and supporting with community COVID-19 awareness and education
As an essential partner to ensure both in B2C and B2B capacities, the financial industry, is also stepping up. Bank of America, a key partner for countless businesses, is putting up over $350 to support medical resource capacity and community development. While JP Morgan is donating $50 million for small businesses, and global humanitarian relief.
As these examples show, companies with a well-established, activated purpose have been able to respond with speed, empathy and compassion. For companies who have not yet learned to use purpose as a decision-making lens, reactions have been slower and less effective.
Moving from a stated purpose to an activated purpose requires intention. As B2B companies recalibrate strategies and operations for the COVID-19 world and beyond, they have the opportunity – or perhaps necessity – for purpose to play a prominent role. This is a unique chance to reset and meet new expectations, and become more resilient, responsive and sustainable organizations.
For B2B companies who understand that now is the time to activate their purpose, here are some key recommendations:
1. Drive purpose from senior leadership
Purpose should be “owned” by senior leadership to be sustained and impactful. With purpose set as an organizational vision, teams will be better equipped to implement and activate purpose internally and externally.
2. Make employees your engine
Employees are your most powerful stakeholder to define and activate an authentic purpose. Engage them deeply to understand your organization’s human and cultural truths and find out how they want to impact society.
3. Embed purpose into culture
One of the most challenging aspects of implementing purpose is to strategically, consistently, and patiently embed it into company culture. To deliver its full potential, purpose must be lived from senior leadership to the factory floor via individual behaviors, policies, and internal and external actions. When it is “lived,” purpose becomes a powerful decision-making tool.
While 2020 has challenged us all, the events of this year have also provided opportunities to re-imagine how we live and work. For companies, what was a gradual evolution in stakeholder expectations has become a revolution.
Companies must navigate COVID-19 and grasp the power of a clear and activated purpose to guide them in the most turbulent of times. They must make compassionate decisions for their future survival and eventual return to growth in a world of radically different stakeholder expectations and needs. Actions are required. Authenticity is key. Now is the time to make your purpose work harder.
To learn more, download The B2B Purpose Paradox report for insights on the paradox and principles to develop a high-impact purpose. To infuse greater purpose in your organization, reach out to the CCOP team: ccone@carolconeonpurpose.com