Whilst there are numerous global issues that require organisational focus and support, including climate change, use of plastics and other sustainability topics, much of the organisational purpose narrative is set in the context of ‘what the world needs’ underpinned by global aspirations. However, for many organisations, this is either too lofty or too distant, as the communities they serve are either national and/or regional in nature. Further, many of the practical examples of ‘purpose’ are based on companies with a global reach that have been created relatively recently, thereby creating further questions of relevance for some long-established organisations.
Purpose
In the October 2021 issue of Harvard Business Review, Hubert Joly shared his thoughts and recommendations in creating a meaningful corporate purpose, including the following definition:
“It is the ultimate goal of the business, the essential reason why it exists and how it contributes to the common good.”
As Joly noted, this assumes the business can be a force of common good, not just a vehicle for maximising shareholder returns. He adds, “to land on an authentic, credible and powerful purpose explore these four areas thoroughly:
- What the world needs: e.g., what specific, important unmet needs exist? How critical is it to address these needs? What difference will it make?
- What people at the company are passionate about: e.g., what drives people at the company? What difference are they keen to make?
- What the company is uniquely good at: e.g., what are the unique assets that allow it to address certain needs in a way that others can’t? How do they need to evolve to address these needs?
- How the company can create economic value: e.g., what business opportunities stem from these considerations? How attractive are the associated profit pools? Can the company capture enough of this value?”
This is a model based on the Japanese concept of Ikigai – giving a sense of purpose and reason for being – which has been developed by others including Mark Griffin in 2020, in which he incorporated passion, meaning, mission and values as key sub-sets. Also, it is a model that is, to some extent, reflective of the Hedgehog Concept developed by Jim Collins in ‘From Good to Great’.
At Whitecap, we would advocate the following adaptations. Firstly, to amend ‘what the world needs’ to ‘what the region needs‘, or to ‘what the community needs’; however ‘community’ is defined. In this context the role of ‘place’ can become highly significant. And secondly, whilst having a strong purpose can support and complement profit goals, the question relating to ‘economic value creation’ would not apply to many organisations such as local government, charities, and universities, and we therefore advocate that this is broadened to encompass creating economic and/or social purpose.
Place
As an example, the concept of ‘place’ was explored in the higher education sector in 2019 with publication of the Universities Partnership Programme (UPP) Foundation Civic University Commission’s report: ‘Truly Civic: Strengthening the connection between universities and their places.’
In the report forward, Lord Kerslake, Chair, stated:
“Universities play a key role nationally through their teaching and research work. But they are also hugely important to the economic, social, cultural and environmental wellbeing of the places in which they are located.”
“The importance of this civic role is also growing. As the UK grapples with the challenges of low growth, low productivity, the impact of austerity and widening spatial inequalities, universities – alongside local authorities and the heath sector – can be significant ‘anchor institutions’, able to make an enormous impact on the success of their places.”
The report went on to define an Anchor Institution as:
“Anchor institutions are a poorly defined and loose term. But it is clear that universities are – alongside the NHS and local authorities – one of the key institutions in many places. They create wealth in a variety of ways, including through their direct spending on wages and local goods and services, and through the knock-on effects in the local economy. They play – and are required to play – a core role in an ageing and automated society. Lifelong learning will be crucial to deal with both of these challenges and help places around the country thrive. They also are increasingly involved in activity that makes life meaningful and pleasurable for local people: including education more broadly, and arts and culture. Without them, many places would be poorer on most measures.”
Whilst clearly this is applicable for universities, they are not the only type of organisation where ‘place’ plays a major strategic role; a number of others are outlined in the following section.
Practical Applications
We work with numerous regional and national organisations across multiple market sectors, both directly on an advisory basis, as well as part of regional ecosystem analyses for specific market sectors and industries. As part of this work, we are often helping shape the strategic agenda and direction for the organisation and/or region, and as a result have some insight into the practical challenges and considerations facing organisations.
Many of the regional building societies, some approaching their 150th anniversary, were established in specific locations to support their local communities. Today, whilst most have head offices and branches concentrated in their heartland, the business model has expanded to become national for mortgages via intermediaries and increasingly for savings too through digital channels. Developing a relevant and meaningful purpose, sometimes incorporating place and community, and linked to core business performance is a current aim for some societies.
For example, the Furness Building Society is developing a stronger regional focus in the Lake District; the Monmouthshire Building Society is opening more community branches in Wales, as well as a Community Bank business model; and the Leeds Building Society is building a clearer and stronger purpose aligned to its founding principles and origins focusing on making home ownership more accessible. There are also a number of other building societies actively considering how a meaningful alignment of purpose, community and place could bring to life the concept mutuality and value of membership to their customer bases.
As noted, many universities have explored and are developing the concept of place given their heritage, scale of local employment and economic impact of students in their particular location; however, many have yet to tackle purpose, and specifically strategic differentiation and/or specialisms. The identification and development of a university’s “flagship areas” – areas of excellence and deep expertise – is necessary to differentiate in what is a crowded sector. These flagships are also relevant for building a university’s brand, both internally and externally, and therefore have to strategically align the university’s purpose. A relevant and topical example is that of Oxford University which has a stated commitments “To change the world for the better”, is one of the Top 5 universities in the world for Life Sciences and is an anchor institution to the renowned Life Sciences economy in Oxford.
Connection with ‘place’ is a significant issue with the local West Midlands universities, possibly because there are so many in a relatively small geography. Birmingham City University have been very forthright in their strategy document about their role in the region (reinforced by a move from a suburb, Perry Barr, back into the city, where they are a key part of the Eastside redevelopment). Their 2025 strategy document states, “we are Birmingham to our core” and outlines “our ambition to work as an integral part of our communities, not only responding to their needs and aspirations but also providing a resource and an impetus for change.”
The University of Birmingham have also strategically reinforced their sense of place, by opening the Exchange Building on Centenary Square, stating, “The University of Birmingham has always embraced the role that universities should play in contributing to regional growth and opportunities. It was founded as the UK’s first civic university, a university that would work in partnership with the city’s commerce and industry and deliver benefits for citizens that extend well beyond higher education. This remains core to our purpose and will be enhanced through The Exchange.”
The recently formed combined authorities with devolved decision making and policy development for regional regeneration and pursuit of enhanced economic and social aims through skills, jobs and infrastructure are also good examples of where purpose and place combine. The West Yorkshire Combined Authority vision encompasses this succinctly, “to be recognised globally as a place with a strong, successful economy where everyone can build great businesses, careers and lives supported by a superb environment and world class infrastructure”, which has resulted in numerous public and private sector initiatives.
The West Midlands Combined Authority also looks to connect ‘place’ with the economic and social welfare of the people, whilst avoiding being a traditional local government device driven by arbitrary boundaries. “We want to build a region where people thrive in the places they live and work. That’s focused on people as well as place”. The more fluid geography created by different levels of membership, where full members (the original West Midlands County metropolitan boroughs) are added to by members with reduced rights (councils / LEPS across the region from Shropshire to Rugby), helps make ‘place’ more real and relevant to local people, and reflects economic and cultural influence not council area borders.
There are numerous FMCG and retail brands either established within or borne from specific regions across the UK. Many continue to operate within their traditional area, whilst others have leveraged their regional heritage to develop national brands through multiple distribution channels and some food brands have sought protected geographical status. For these brands, place provides a predominately marketing and/or operational context, such as the regional supermarket group, Booths, who have pursued a regional purpose since their formation: “Our founder Edwin Henry Booth had one simple aim, to sell the best food and drink available, in attractive stores, staffed with first class assistants. Since 1847, we have worked closely with local suppliers from the Northern counties we call home: Lancashire, Cheshire, Cumbria and Yorkshire – Booths Country”.
In his book ‘Business Trends in Practice’ published this year, Bernard Marr summarises why purpose matters, quoting the Strength of Purpose Survey which surveyed 8,000 consumers across 8 markets and 75 brands, highlighting that having a clear and compelling purpose delivered material business benefits, such as consumers would be four times more likely to buy from a brand; four times more likely to trust the brand; four and half times more likely to recommend the brand; and six times more likely to defend the brand in challenging times. These are example customer and user ‘engagement benefits’ which most organisations would seek to develop as part of their strategies.
What is clear, is that whilst many of these example organisations can develop a clear and relevant purpose aligned to their core business model within a specific location or region; they cannot, on their own, achieve dramatic impact in isolation, rather collaboration and engagement with regional and other strategic partners is likely to be required.
In summary, as competitive pressures continue to increase through consolidation and external economic pressures, as well as the pursuit of organisational effectiveness, defining and delivering a relevant, authentic, and meaningful purpose for stakeholders may become increasingly important for many organisations and the communities they serve.
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Established in 2012, Whitecap Consulting is a regional strategy consultancy headquartered in Leeds, with offices in Manchester, Milton Keynes, Birmingham, Bristol and Newcastle. We typically work with boards, executives and investors of predominantly mid-sized organisations with a turnover of c£10m-£300m, helping clients analyse, develop and implement growth strategies. Also, we work with clients across a range of sectors including Financial Services, Technology, FinTech, Outsourcing, Consumer and Retail, Property, Healthcare, Higher Education, Manufacturing, Logistics and Professional Services, including Corporate Finance and PE.