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PURPOSE A sense of purpose is increasingly recognised as essential for business and personal success.© Copyright 2012 London Business School

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Purpose, defined by Douglas Ready and Emily Stecker Truelove is “the company’s reason for being;why it exists; its core mission as an enterprise”.BUSINESS STRATEGY REVIEW 1

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Nikos Mourkogiannis, author of Purpose: The Starting Point of Great Companies says successful companies define purpose in one of four ways. 1 2 3 4BUSINESS STRATEGY REVIEW 2

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Discovery - This type of purpose involves a love of the 1 new and innovative, and it animates many technological businesses. Seeking the new does not mean constantly changing course.BUSINESS STRATEGY REVIEW 3

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Excellence - Excellent businesses prefer to turn away2 customers than compromise their quality standards.BUSINESS STRATEGY REVIEW 4

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Heroism - Think of Henry Ford’s creation of his world-3 changing motor company or Bill Gates’ Microsoft.BUSINESS STRATEGY REVIEW 5

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Altruism - This purpose could take the form of4 personal service beyond that normally expected, delivering products at affordable prices, or using technology and ideas to improve lives.BUSINESS STRATEGY REVIEW 6

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Purpose in numbersBUSINESS STRATEGY REVIEW 7

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A strong, strategically coherentand well communicated corporatepurpose is associated with up to17% better financial performance.IMD/Burson Marsteller Corporate Purpose Impact Study 2010BUSINESS STRATEGY REVIEW 8

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Only 10% of managers take purposefulaction — a powerful combination ofenergy and focus. Meanwhile, 30% ofmanagers procrastinate, 20% showdetached behaviour and 40% exhibitdistracted behaviour.Sumantra Ghoshal and Heike Bruch BUSINESS STRATEGY REVIEW 9

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“Management was, is, and always will be the same thing: the art of getting things done.” Bob Eccles and Nitin Nohria, Beyond the Hype.BUSINESS STRATEGY REVIEW 10

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Only 40% of employees understandtheir organisation’s strategy.Accenture High Performance Workplace StudyBUSINESS STRATEGY REVIEW 11

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88% of highly engaged employeesbelieve they can positively impactthe quality of their organisation’sproducts; only 38% of disengagedemployees think so.Towers Perrin 2008BUSINESS STRATEGY REVIEW 12

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“You cannot foster true innovationwithout engaged employees.”Julian Birkinshaw, MLab and London Business SchoolBUSINESS STRATEGY REVIEW 13

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Only 4% of UK workers exhibit thehighest level of engagement withtheir work.Corporate Leadership CouncilBUSINESS STRATEGY REVIEW 14

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“The purpose of business is to create a customer.” Peter DruckerBUSINESS STRATEGY REVIEW 15

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40% of a company’s reputation is determined by its purpose and 60% by performance. Burson Marsteller/Penn, Schoen & Berland, 2008BUSINESS STRATEGY REVIEW 16

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This report was part of Business Strategy Review, Volume 22 – Issue 3 2011 Visit our website www.london.edu/bsrBUSINESS STRATEGY REVIEW 17