Purpose starts at the top
Before I get into discussing organizational purpose, I want to take a moment to wish all our service men and women a happy Veterans Day. Today we honor all who have served to protect our freedom. Thank you for your service and sacrifice.
At NAFCU, we talk a lot about our purpose – our “why” – and that’s helping our member credit unions grow and strengthening the credit union industry. Every organization has a purpose. It’s what drives short- and long-term visions. It allows us to reflect on new strategies and opportunities to see if we’re on the right path to meet our mission.
A recent Harvard Business Review article by Ron Carucci and Garry Ridge highlighted evidence that shows purpose-driven organizations across sectors outperform their competitors in all critical metrics. But just because your organization has a stated purpose, doesn’t mean it’s clear to your employees. Purpose must be driven from the top – we, as leaders, create the culture of working for and celebrating that purpose.
Another consideration: In a competitive job market, talent retention is key. Carucci and Ridge said that purpose-driven organizations retain employees and have more productivity. They gave four factors that indicate an organization has effectively generated purpose among its employees:
1. Clarity: Do employees understand the purpose of the organization? Do they know why their work is valuable?
2. Alignment: Is the management team invested in the purpose? Does the organizational vision match the purpose?
3. Ownership: Do employees feel invested in the purpose? Do they feel ownership to push the organization further?
4. Trust: Does management give employees the chance to take initiative and act upon the purpose?
With remote work and digital communication becoming more common, it’s crucial that leaders and management clearly communicate an organization’s purpose and put it into practice daily. Creating and fostering an environment where your purpose is prioritized will inspire employees – strengthening their loyalty to your organization and bolstering your success.