In a previous post, we talked about the need for your business plan to reflect your business purpose. We went so far as to say that if there’s “stuff” going on in your business that doesn’t clearly link to purpose, then maybe it’s a waste of time and resources (apart from the normal “hygiene” things that need to be done in any business).
You can read the post here.
There still seems to be some scepticism on the issue of purpose. We think it’s most likely because it’s a concept in that dangerous territory of being “flavour of the month”. So we get it, but dismissing its potential impact does your business no favours. All the research says so.
Here’s why purpose-driven business planning is a driver of success.
1. Prioritising projects
Why you’re in business - your purpose - drives project prioritisation. Most business planning sessions result in multiple new projects, adjustments to existing ones and a whole range of supporting tasks. You can’t hope to prioritise without a clear sense of why your business exists.
2. Allocating resources
With clear priorities you can make more informed decisions about how and where to allocate resources in the business.
There’s only so many people and physical resources for which competition is usually fierce. Linking the planning process to purpose enables greater objectivity and transparency in the allocation process (provided of course, your purpose is well communicated and understood across the entire team).
3. Attracting talent
And speaking of people, purpose-driven business planning makes it much easier to put in place the right operational structure and recruit the right talent.
Because clarity of purpose and what needs to be done to get you there (your business plan) are fundamental elements of an attractive employee value proposition.
4. Fearless communication
Clearly linking your business plan to purpose also helps create a culture where your team can provide fearless advice to leadership when they see the need. We posted on fearless communication recently.
Plus, a “purpose-built” business plan gives team members permission to be creative and innovative (even if those words are a tad over-used these days). Purpose provides clarity of direction which helps everyone understand the parameters within which measured risk-taking is ok. And you don’t get innovation without some degree of risk-taking.
You’d think that with these pretty obvious links between purpose and business planning that everyone would be on board. Seems that’s not true though.
A study conducted by EY found that while 90% of executives polled believed their company understood the importance of purpose, only 46% used purpose to drive business planning.
Which is a shame, because other studies have found that purposeful businesses outperform those with little or no focus on purpose. You can read one such piece of research here. Our hypothesis is that this outperformance happens because purpose permeates everything, including business planning processes.
We believe a purpose-driven business plan is an incredibly powerful growth tool. In any business. The evidence is pretty hard to ignore.
We’d love to help you and your business
If we’ve convinced you of the merits of fact checking your business plan against your purpose - actually, even if we haven't - we’d love to hear from you. We're ready to help you bring your business plan and purpose into alignment. Give us a call or drop us a note. We're always up for a chat!
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