Yes, we’ve all heard of the concept of purpose vs profit. However, even with the concept being known to all, corporations continue to prioritize their own welfare and profits. The world is starting a new era, and people are becoming more conscious of what’s happening worldwide. The people (the reason big corporations exist) are starting to stand up and demand change. All corporations are being pushed to change their goals and contribute towards a better purpose. Corporate social responsibility as a side hobby is no longer enough. While it’s easy to say that you choose purpose over profit, how do you genuinely make it happen while remaining in business? What does it take to do good and do well at the same time?
Dual-Purpose Companies
To be a purpose-driven company, you don’t have to start that way from the very beginning. If you started out as a profit-driven company, there is always a chance for change. For example, the successful outdoor clothing company, Patagonia, is a great example of an enterprise that pursues both. They started out prioritizing financial goals and have now come to balance out social good into their mix. Patagonia, along with many different successful socially driven businesses, all share a common system: hybrid organizing.
Research done by the Harvard Business Review states that hybrid organizing involves four levers: “setting and monitoring social goals alongside financial ones; structuring the organization to support both socially and financially oriented activities; hiring and socializing employees to embrace both; and practicing dual-minded leadership. Taken together, these levers can help companies cultivate and maintain a hybrid culture while giving leaders the tools to productively manage conflicts between social and financial goals when they emerge, making the endeavor more likely to succeed.”
Setting Goals
Dual Purpose companies need to clearly define their goals and track their progress along the way. Goals shouldn’t be a faint aspiration without a plan. They should be clearly stated and pursued. Don’t let conflicting goals stop you. It’s never easy. One should study all the different paths and select the one that increases the chances of accomplishing the end goal the right way.
Monitoring the Progress
Setting the goal is important, but identifying and adjusting key performance indicators (KPIs) to track how the achievement of the goal is going is essential. Measuring your financial growth is easy. However, how do you measure social impact? While there may not be an accepted metric for this, there is still a visual way to monitor it. You can see the impact you make by looking at the people and environment that are benefiting from your doings. You can tell when you’re making a social impact—no need for numbers or charts.
Structure the Organization
While being entirely dedicated to social good would be amazing, we all know that it’s virtually impossible to run a company if it isn’t designed to support both aspects. In order to achieve an effective structure, think about which organizational aspects create economic value and which ones create social value. Figuring out how they’re related to each other will help you see how to balance them out.
Practice Dual-Minded Leadership
Being more prominent to one side than the other will cause an imbalance and lead to failure. While these opposing sides involve tension and divergent views, leaders must proactively protect both the financial and social sides.
What Truly Matters
There are many companies that are in business just for business. They are not authentic. Social purpose is what makes a difference in this world, not how much money you’re making. Yeah, it’s easier to just go for the money. Going social good is more sophisticated and requires more involvement. But, what will make you feel good at the very end? Which path will positively impact people lives and the planet?
As a corporation that has benefited from the world and the people, the least you can do is contribute back. While many do it as an obligation or a sense of responsibility, Aceneca finds it vital to do it genuinely. At the end of the day, what is it that truly matters to you? Profit vs purpose continues to be a difficult topic within companies. However, we can see the difference between those that go for financial gain and those that go for world change. Doing your part, no matter how big or small can truly make a difference. If you’re looking for a way to make a positive impact on the world with a balance of profit and purpose, then Aceneca would love to hear more about you!