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Insight, news and updates from Alliott NZ Chartered Accountants, Auckland New Zealand. The views expressed here are the views of the author and should be discussed in further detail should an article be relevant to your individual circumstances.

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What’s your purpose?

Written by Greg Millar on July 27th, 2016.      0 comments

What was your purpose in starting your business?

WHY-937Undoubtedly when you decided to start your business you had an inspiration.

Was it to provide a service or product better, faster or cheaper than what was currently available? Was it to fill a gap in the marketplace?

Perhaps you were inspired to run a business that people enjoyed working for or that maintained environmentally and socially responsible ethical standards or that surpassed existing companies in providing superior customer service.

Whatever your mission, find it and then write it down.

The Power of Why

Experience shows that companies with a clear and ever-present purpose statement surpass their competition and last in the marketplace.

Purpose (or Why) statements define and preserve and strengthen a company’s unique competitive advantages. Additionally, companies who are clear about who they are and what they do are less likely to make irrational decisions in response to competition and fluctuations in the marketplace. However, that does not mean your purpose statement should be inflexible.

A good purpose statement can lead a company for 10 to 20 years if time and effort were spent in creating it. However, re-evaluating your why from time to time to see if it is still relevant, significant and appropriate is advised.

Be Specific

You want to create a statement that you and your team can look to every day and ask “Am I fulfilling the company’s mission?” For example, one statement could be “to be the leading game software developer for teens”. A more actionable purpose statement would be “Surpass XYZ games developer in sales, customer experience and speed to market”.

The second purpose statement has clear goals and direction, while the more abstract version would be more appropriate for a vision statement than a purpose statement. The second statement clearly supports the vision statement.

Include a Call to Action

You can distinguish your purpose statement by including a call to action. This is missing in most company purpose statements and has several defining and distinguishing characteristics:

  • It motivates and generates an emotional reaction from your team
  • It is easy to understand and translates into what your employees do every day
  • It states a goal that can be measured and identified easily
  • It reflects and is rooted in the competitive environment in which your company functions

Think back to this statement: “Surpass XYZ games developer in sales, customer experience and speed to market”, if you run this statement through the above four qualifications, you will get a yes every time.

Creating a Purpose Statement that Fits Your Business

When creating your purpose statement, consider these aspects of your business:

  • What is your company’s history and tradition? How does it influence what you want to accomplish today and in the long term?
  • How do you characterise the management philosophy of the company? What input does management have in the direction of the company?
  • What distinguishes your company from all of the other companies that perform the same service or function? How do you already surpass the competition? What can you do to continue surpassing them?
  • What goals are realistic when considering the available resources?
  • Where do you need to improve in order to beat the competition? What are your competitors doing that you can imitate and improve upon?
  • And perhaps most importantly – what impact do you have on your customers’ lives?
Positioning your business for growth requires a clear vision of the future, a start and end point and the ability to track your progress and alter course along the way. At Alliott NZ we understand that you might not have the knowledge or expertise to achieve this, but we do. We also have an extensive range of tools available to help you successfully grow your business. Call us in Auckland today on 09 520 9200.
 

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