Established businesses don’t reach out to marketing communications firms like ours when things are fantastic. Typically, something has changed, and not for the better. We get called when sales have dropped, when the brand has become unclear or when past leaders have stepped aside to make way for someone new.
Beyond these conditions, established companies often have other things in common that contribute to lackluster performance. Many times, they lack a clear or a universally understood purpose that drives their organization. We define purpose as an understanding about the difference your enterprise is trying to make in the world.
Johnson and Johnson: To alleviate pain and suffering.
Charles Schwab: To be a relentless ally of the individual investor.
Whole Foods: To provide choices for nourishing the body, the community and the planet.
Without a shared sense of purpose in their organizations, businesses tend to be reactionary. Leaders tend to make decisions slowly. They spend their days, quarters and years trying to respond to shifts in the market, changes in customer or client demands, evolutions in the competitive landscape, and so on. The result is a lack of focus, and the desire to leave open every possible revenue opportunity, product and service line or geographic territory. Not surprisingly, none of these strategies perform adequately.
This dynamic is exacerbated by shifts in today’s business climate. Increasing competition, rising costs of goods and labor, changing customer needs – all are happening at an ever-quickening pace. The good news is that with effective counsel and a willingness to look at making some changes, established companies can become more competitive through a new commitment to their organizational health: taking the time to understand what drives them, what they are best at, and what it takes to get everyone on board with that mission. While it may be more difficult to make these types of strategic redirects in a more mature company, the organization is always made stronger by the effort.
Conversely, we see startup enterprises coming to the table with very intentional thinking as it relates to organizational health. Founders arrive with total clarity about their purpose as an organization, from HR considerations and behavioral expectations to product innovation and customer service. They use purpose as a strategic lens to guide decisions in many key areas.
Corporate Culture: Entrepreneurs understand that a strong culture begins with purpose. They also know that a company’s culture is vital to recruiting talent. Younger employees want more than a paycheck from their employers and demand their work accomplish something that makes them fulfilled.
Product Offering: Should the product line be niche? Appeal to multiple targets? Beyond the market data, effective startups are using organizational intent as a guidepost for making objective and decisive calls.
Sales: When purpose is foremost, so is the selling proposition. Further, expanding from one salesperson to a team is easier when everyone shares a common goal. Successful startups understand the power of a sales team that operates from the same playbook.
Pricing: Should the product be charged at a premium? Or should a certain feature be considered a value-add? Today’s new business leaders know if a price increase means you can better accomplish the mission, yes. If it goes against what the company stands for, no.
Corporate Social Responsibility: No longer a nice-to-do for large companies, startups recognize the importance of aligning their founding principles with work that can be done to support their communities. In mature organizations, CSR program decisions can also be made with the company’s core ideals in mind. For example, Johnson & Johnson provides drugs to underserved communities in the third world.
While startups don’t have the market cornered on building purpose-driven businesses, they are paying more and more attention to the new competitive realities of linking organizational health with business strategy and brand marketing. Firms like ours don’t create a brand’s image. Done well, our job is to reflect what is already there. So when you think about branding, don’t start by thinking about your logo or website. Begin by examining the impact your company wants to make for your employees, your customers and your community. Start by thinking like a startup.
This article originally appeared in the August 15-September 11 issue of Columbia Regional Business Report.