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Why are you in business?
Are you here to make money? Or are you here to achieve a mission?
Hint: it’s a false choice.
One of the thorniest issues I see when working with companies is how to reconcile purpose with profitability.
There are many different viewpoints on this issue—but since this is my newsletter, you get to hear my personal take. ;)
It Really Does Start With Why
Simon Sinek popularized the phrase “Start with Why,” and although he’s not my go-to for business advice, he’s not wrong.
Not sure what a “why” is or if you have one? We use the model of the 9 Whys created by Gary Sanchez. Your company is probably set up to do one of the following:
1. To contribute to a greater cause, to add value
2. To create relationships based on trust
3. To make sense out of complex things
4. To find a better way of doing things
5. To do things the right way
6. To challenge the status quo with new thinking
7. To seek mastery and understanding
8. To seek clarity
9. To simplify
Although your “why,” often expressed as your mission, will likely have more specific language, it’s going to derive from one of these principles at its core.
Why Does “Why” Matter?
A company’s “why” guides decision-making, and whether you’re an employee or a customer, you can feel it. It’s the filter through which a CEO says yes or no to certain opportunities.
If you aren’t connected to the “why” of it all, the reason you do the work you do, your company will end up off-track at its core. And when the core of the company gets off-track, it starts to lose its identity:
Messaging becomes unclear
The people are uninspired
You spend too much time chasing distractions
And, as you can imagine, those things can significantly affect operations as well as the bottom line.
Purpose Does Not Guarantee Profits
But there’s some nuance here that must be considered.
Having purpose is imperative. But it doesn’t guarantee profitability.
Purpose and profits are different. And the idea that one will naturally flow into one another is a little too much magical thinking.
Profitability is the result of running a good company. Having the right business model, being operationally strong, watching your finances, etc.
It is possible to live your purpose—and run your profitability straight into the ground.
Said another way: if you’re not profitable, it’s not necessarily because you aren’t living your “why.” Don’t let purpose become an excuse.