How do you know if purpose is working effectively in your culture. And if it isn’t, why not?
Here’s a promise; purpose can transform your organisation’s performance. If you get purpose right you can expect to see a gain of at least 30% in engagement, 29% in joy and 26% in productivity, based on your median employee.
It’s a claim we can make based on the impact of purpose on human and business performance in a whole range of companies. And we’ve seen the same results in companies from global multinationals to fintech entrepreneurs.
Purpose is at the heart of all the best agile, entrepreneurial businesses. But that is only half the story.
It’s accepted that purpose-led companies are more attractive and empowering places to work. It’s increasingly claimed that purposeful companies also out-perform their profit-driven peers. But, if so, why?
We’ve always been fascinated with what drives human performance and productive cultures in organisations. Specifically, in the differences between agile, entrepreneurial businesses and scaled, legacy corporate ones. We have spent years observing and codifying the differences between the entrepreneurial and corporate businesses we work with. In doing so, we have identified a whole basket of behavioural differences. Fundamentally, they come down to one word – ‘purpose’. But not in the way you may think. It’s not about having a purpose. But what you do with it.
Yes, the best agile, entrepreneurial businesses are obsessively clear about why they do what they do. But that’s not the whole story. They also exhibit a set of specific cultural attributes that activate purpose to drive startling levels of human motivation and performance. And exactly those same cultural attributes are largely suppressed in most scaled businesses – stunted by time, complexity and legacy.
The cultural attributes that enhance both human meaning and business performance
Developing this model of purpose activation got us wondering. Is it possible then to measure purpose? Is is possible to create robust metrics of purpose impact, and could that model show exactly how purpose works to improve performance? If so, could it enable any organisation to emulate the best agile organisational cultures? By adopting the right mix of cultural attributes can any business activate purpose to enhance both human meaning and business performance?
To find out, we teamed up with leading academics and researchers led by Cambridge University and Plymouth University. Together, we spent two years building just such a measurement process. This is based on assembling, for the first time, world-leading academic scales of performance measurement into one model. The model measures the key human performance factors known to support sustained organisational performance. It then seeks to understand the causality of these by linking each back to purpose through the assessment of a defined set of cultural characteristics. In this way, the model both measures the impact of purpose and demonstrates how it is working in the organisation.
The model measures the key human performance factors which impact performance and demonstrates how it is working
The Index gathers data from a representative sample of employees via an on-line survey or app. This is not a subjective, external view of purpose, nor is it based on proxy measures. It provides a clear metric of purpose performance that can be bench-marked internally, over time and against peer comparitors. It represents an uncompromisingly accurate view of how purpose is working and where it is blocked in the real business, in real time. Results are provided by demographics (age, sex, seniority, location etc) via an interactive dashboard and in a detailed report with specific analysis and recommendations.
It’s not purpose but activation that matters
So, what does the model reveal?
Firstly, can you measure purpose? The answer is absolutely yes.
And can you measure the impact that purpose has on the performance of real businesses in real time, using robust numbers that can be bench-marked over time and between businesses and sectors? Again, the answer is yes.
It is clear that an activated purpose galvanises specific human behaviours, and it is these behaviours that drive commercial performance. The key question is what characteristics in the organisational culture activates purpose to allow for these performance gains – and what is missing when purpose is suppressed.
One factor dwarfs all others – whether someone considers their employer to be purposeful
There are multiple factors that determine employee performance. But one factor dwarfs all others. Those employees who consider their employer to be purposeful score between 25% and 100% more positively than the median employee across a broad range of performance attributes. This includes, of course, engagement but also autonomy, openness, clarity or strategy, velocity, joy and many others. The are also 30-50% less likely to quit. And the key cultural factor that activates purpose to achieve these performance gains appears to be the presence of emotional ownership and an assumption of trust.
What this means for you
What this means is that the simple act of engaging all staff with a clear and inspiring purpose will indicatively lead to performance gains of 25%, and in extreme cases 100%, and a reduction of staff turnover by at least 30%.
It shows, for the first time, that the key activator of this effect is not a statement of purpose but may be the creation of a culture of trust and emotional ownership.
And it allows you to identify accurately, and with extraordinary detail, specific communities where the impact of purpose is blocked. It then allows you to track the impact of interventions or communication on these individuals and and to adapt these in real time to maxmise the effect with real efficiency.
What do the companies who have take the Index so far have to say?
All the companies who have taken the Index so far have revealed startling new insights into how and where purpose is working and where its effect blocked.
“This has fundamentally changed how we think about our people and their motivation. The clarity it’s brought has been extraordinary.” FTSE PharmHealthcare
It has also enabled them to design highly targetted interventions with a great deal of confidence, since they are based on reliable empirical data, and ‘pulse’ survey all or specific groups in the business to assess their impact in real time.
“Without Purpose, a company can only flipflop around without truly consolidated, effective effort. What Contexis has developed is a very clever way to measure the impact of purpose on performance, enabling companies to really motivate their teams. Contexis Index did it for us!” Fintech challenger
By undertaking this analysis you will develop remarkable insights into how purpose is working in your organisation and where it is not. You will also be joining companies around the world in supporting important research into how purpose drives commercial performance by contributing wholly anonymised data to the University of Cambridge.
To find out more about how the Contexis Index can transform the impact of purpose in your business, and how you can help this important research please get in touch.
To find out more about the thinking behind the methodology you might enjoy this short EthWord film
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John Rosling is a writer and lecturer on entrepreneurship, CEO of Contexis and Head of Thought at the Contexis Index; ever curious as to how entrepreneurial thinking is the key to activating purpose, stimulating agility and velocity and fulfilling human and commercial potential in global organisations.