Which comes first: purpose or values?
“Does it really matter?” A couple of questions in a recent conversation, that might go into the “Meaning of life” file, or “Angels dancing on the head of a pin” category. But we think it is important to be clear on this, and that there is definitely a right order to follow.
For us, purpose comes first. It has to. Because it deals with the fundamental question of why an organisation exists. And it points the organisation outwards: it says “we understand the world we’re in, and what that world wants from business.” It shows that the organisation has understood its potential role and contribution. It must be forward-looking. It should also provide meaningful, demonstrable, differentiation.
The answer to “Why do we exist?” should be the unchanging core of any organisation’s description of itself. And, by the way, a true purpose cannot be confined to the desired experience of customers or clients: it needs to address what Paul Polman called “real-world problems”. Otherwise, it’s not much more than a tagline.
The values are the guiding principles for that organisation in pursuing its purpose, driving the right, supporting behaviours. They are, by definition, more inwardly-focused (with, of course, an external expression).
Two big arguments about doing this the other way around seem obvious. If you start with a discussion of “What are our values?” you might end up with a list of, let’s say, four (we have a problem with this in itself, by the way, because we think that any brand should have only one core value, and that many of what people call ‘values’ are not them at all…but that’s for another time). What do you do then? Use those values as a means of defining what business you are in? Or determining what your purpose should be?
Let’s imagine a business decides on Respect, Integrity, Communication and Excellence as its four core values. What purpose should that business have, as a result of those values? What “real-world problems” is it going to solve? It’s all a bit vague. So, let’s get closer in…what type of business is it going to be? Media? Telecoms? Still not clear? We’ll come back to this.
The second major problem is in that phrase “meaningful, demonstrable differentiation”. If you’re going to start with your values, you’d better make sure that they provide that. Okay… “integrity…possibly the most over-claimed of all values (featured in how many law firms/ financial services/ FTSE companies/etc?) so it’s hardly the best differentiator. What about ‘excellence’? Unless you’re competing against a group of businesses all claiming ‘mediocrity’ that’s not going to do a great job, either. As for ‘communication’ – is that even a value?
Starting with values means you’ll have a harder time to define a real purpose, because you’re coming from an internal, and often historical, perspective. You’re in danger of being the man with a hammer looking for a nail.
Which brings us to the most critical aspect of all: relevance and authenticity. Vagueness is a product not only of starting from the values, it’s also from not working hard enough at understanding the contribution the organisation can make. A purpose statement needs to be big, and it needs to be generous, but it also needs to be credible. Is a coffee bar really going to nurture the human spirit? Probably not. Is a law firm going to eradicate starvation in Africa? Doubtful.
The business we referred to above with those RICE values was Enron. Which also reveals another demand of values, which is that they be upheld in the everyday business and behaviours of the organisation they’re meant to define. But for anyone who believes that values come before purpose, would this be a good example?