Thinking about an organisation’s purpose – Why, exactly, does it exist?

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Very few people or companies can clearly articulate WHY they do WHAT they do. By WHY I mean your purpose, cause or belief – WHY does your company exist? WHY do you get out of bed every morning? And WHY should anyone care?’ (Simon Sinek, Start with Why: How Great Leaders Inspire Everyone to Take Action)

Simon Sinek is right. Getting your why straight is vital, and that’s why so many successful business leaders think so long and hard about it. When the commercial landscape is in a state of serious sustained turbulence, for example during an acute recession or thanks to Brexit, the why is particularly important.

How to pin down the why in a realistic way

When thinking about an organisation’s purpose, the why question that leaders often vacillate over is how to articulate their organisation in aspirational terms, in ways that inspire without being so pie-in-the-sky or full of hot air that they don’t translate into meaningful real-world action. One Chief Executive put it to us like this:

Since I came into the role I have asked a lot of people what they think the purpose of our organisation is. In some of the responses I have had to what I have sent out I find myself being pointed in the direction of ‘happiness’. It’s not a term I have been comfortable with if interpreted as being about mere fun. If we were to redefine happiness on our terms, less instant and less emotional with a deeper meaning, I think we could adopt it.

Is it all about employee happiness?

As Simon Sinek says: ‘Happy employees ensure happy customers. And happy customers ensure happy shareholders—in that order.’ So should the goal of business leaders be to make their employees happy? Should organisations – whether they’re companies, not-for-profits, or governments – talk about their purpose in terms of increasing people’s well-being, quality of life or happiness? Should they talk with customers and clients about happiness being the aim of the organisation?

When happiness is too fleeting

Well-being has medical connotations. Quality of life has similar connotations, and happiness has strong associations with transitory, fleeting emotional states. Enhancing people’s subjective well-being, their SWB, is something an entertainer who makes us smile does. Politicians do it too, in pursuit of votes. But most of the time a business leader’s purpose is much more significant, much more important than merely enhancing the entertainment factor. It’s not that they don’t want work to be fun, it’s just that their purpose needs to be more transcendent, more meaningful than enjoyment alone.

Perhaps it might help to focus on the key distinction between well-being and happiness.

First and foremost, the field has witnessed the formation of two relatively distinct, yet overlapping, perspectives and paradigms [of] well-being that revolve around two distinct philosophies. The first of these can be broadly labelled hedonism … and reflects the view that well-being consists of pleasure or happiness. The second view, both as ancient and as current as the hedonic view, is that well-being consists of more than just happiness. It lies instead in the actualization of human potentials. This view has been called eudaimonism … conveying the belief that well-being consists of fulfilling or realizing one’s daemon or true nature. The two traditions — hedonism and eudaimonism — are founded on distinct views of human nature and of what constitutes a good society. Accordingly, they ask different questions concerning how developmental and social processes related to well-being, and they implicitly or explicitly prescribe different approaches to the enterprise of living.’ (Ryan & Deci (2001) ‘On Happiness and Human Potentials: A Review of Research on Hedonic and Eudaimonic Well-Being’ Annual Review of Psychology 52 Pp. 141 – 66)

Is your purpose both definite and relevant?

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An organisation’s purpose needs to say something definite and relevant about the way the people working there want to live, both as individuals and employees. It’s also about the things an organisation believes about its people.

Broadly speaking, eudaimonia is about fostering states and activities associated with developing the best in oneself as an individual, and collectively, which in turn implies a talent management perspective. It also means being true to one’s self and one’s deeper principles. This is often expressed as enhancing human flourishing. Hedonia, on the other hand, is more about fostering states on a shorter term, states that involve pleasure and enjoyment along with an absence of pain and discomfort.

How human flourishing matters

So do business leaders want their organisations to be about enhancing human flourishing? The answer is yes. The ethics of eudaimonia are sometimes called virtue ethics, where human flourishing is a virtue to be cultivated. It is also the basis of the capabilities approach to economic development, an approach associated with the writings of Nobel Laureate, Amartya Sen.

The goal of development is to increase human capabilities. According to Aristotle, eudaimonia is the ultimate human good. It requires character and thought, things we increasingly call attributes. But the goal is not happiness per se. Happiness is a by-product, an inevitable consequence of taking pride in being excellent at what we do. If it’s important for us to be healthy, for example, we have to choose a healthy lifestyle – our choices relate directly to the things we have the power to do.

As Aristotle said:

Excellence is an art won by training and habituation. We do not act rightly because we have virtue or excellence, but we rather have those because we have acted rightly. We are what we repeatedly do. Excellence, then, is not an act but a habit

It’s vital for business leaders to recognise how important this is when come to formulate their organisation’s purpose. As Simon Sinek says: ‘All organizations start with WHY, but only the great ones keep their WHY clear year after year.’ (Simon Sinek, Start with Why: How Great Leaders Inspire Everyone to Take Action)

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