In the public perception, profitable growth alone has long ceased to be the accepted legitimation of the business model. With a “purpose”, companies provide answers to the increased need for meaning of younger generations and respond to an increasingly critical public. They formulate their purpose as a whole and show how they face the challenges of our time and what contribution they make to society with their economic activities.
Door opener for necessary change
But what about companies that are economically threatened as a result of the corona pandemic and may even have to lay off employees? Does a purpose continue to be important for these companies – or is a higher corporate purpose just a luxury that they can afford in good times? Does the purely economic count first in the crisis? Or can a clearly formulated purpose of existence help, especially in difficult times, to initiate the necessary transformation processes in companies and ultimately lead to decisive competitive advantages?
The latter should be the rule. The world’s big problems are still virulent – customers and investors increasingly expect adequate answers from companies. The claim to meaning does not disappear even in a crisis. But that’s a good thing, because companies do well now to gear their actions towards a purpose: A purpose that fits the company can open the door to strategic change processes that have long been required. Defined jointly with all employees, it can drive transformations towards future-oriented companies and generate innovative business models, new options for differentiation of offers, higher employee motivation and stronger customer loyalty.
Home office: commitment remains important
The corona pandemic has completely turned the world of work upside down in a very short time. Never before have so many employees been working from home. In April, 34 percent of employees in Germany worked wholly or partly in the home office, as figures from the Socio-Economic Panel (SOEP) show. The number of home workers was three times as high as before Corona. At the peak of the contact restrictions, 60 percent of the employees with university degrees were “remote workers”.
The experiences in many companies are positive. It turns out that business trips can usually be replaced by video conferences. Completely contrary to all fears, it is also becoming apparent that employees in the home office are working more efficiently and usually longer, because there are no interruptions from chatting colleagues and time-consuming commutes to work in the morning rush hour. A hybrid model between office and home office will probably be the new normal for many office jobbers in the future.
Purpose is the glue between the company and its employees
The more employees work mainly decentrally and digitally networked, the more important a good purpose strategy becomes for companies. A corporate purpose shared by all employees creates a common heartbeat and a sense of belonging to the company – factors that can quickly be lost in a corporate culture with predominantly mobile work. Because as the proportion of home offices increases, so does the risk that the employees’ loyalty to the company will decrease. The short chat in the coffee kitchen, the shared lunch breaks with work colleagues and the feeling of being right in the middle of the company building “where it all is” – all these little identification components are missing in your own four walls away from the business premises and can at least subconsciously lead to an emotional decoupling .
A convincing corporate purpose is therefore more important than ever. It works like a putty that connects the spatially separated employees with one another. It sharpens unique selling points in the competition and shows employees what added value they are creating for a better world. This increases the pride of belonging to exactly the right company. Like a north star, a common and well communicated purpose offers orientation: All employees know what they get up for in the morning and how they are going about their respective projects – whether in the office or home office.
A common attitude is decisive
Experts believe that the corona pandemic could have accelerated digitization and the use of new working methods in Germany by around ten years. Many companies have – of necessity – adjusted the general conditions for working together to the new situation within a few weeks. What was previously part of lengthy change processes has long been daily practice in many companies. In a very short time, teams and entire departments have proactively adapted to the new requirements. Basically, nothing else is meant by “agility”.
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With the use of teams, zooms and the like, the willingness to introduce agile working methods in all areas of the company increases. The associated increasing networking, the more intensive exchange between the departments, the flatter hierarchies, the greater personal responsibility and self-organization as well as the constantly changing requirements and processes can, however, create considerable uncertainty and increasing pressure among employees. Therefore, more important than ever is an overarching corporate purpose that offers orientation and security – as a safe haven in uncertain times.
A purpose strategy suitable for the respective company can be a decisive success factor in a working world that is changing at an ever faster pace. It helps to define a common basic attitude with all employees and to support the networking and cultural change processes that are so important in the digital transformation. If everyone in the company knows why and for what relevant corporate purpose their work environment is changing, then the steps necessary to do so cause less fear, but rather take place at best as a “means to an end”.
Win “War for Talents”
Whether Generation Y with those born after 1980 or Generation Z with those born after 1994 – what both generations have in common is that they value self-determination in their job and value a good work-life balance. Career, money and status symbols are far less important to them than previous generations. In return, the members of Generation Y and Z pay more attention to the effects of their own actions and the well-being of people and the environment. Both generations have clear values. They expect social commitment from the economy and thus also from the companies in which they work. In other words: companies with a credible purpose that corresponds to the values of generations Y and Z are ahead in the “war for talents”. This is especially true when companies discover and activate the topic of purpose not only as lip service, but as a real “matter of the heart”.
The competition for well-trained workers is likely to intensify in the new, agile work culture. Employers can indeed increase their pool of applicants in professions that are suitable for a high proportion of home office work well beyond the current catchment area. But that is not only a benefit for companies. When distances no longer play a decisive role in the new normality of home office when deciding on a company, it is primarily the applicants who win. You can choose your employer almost regardless of location or at least increase your search radius.
Be considerate of generations Y and Z.
Increasing home work should lead to better matching on the labor market overall and thus improve the growth opportunities of companies – but with a view to generations Y and Z only for companies that clearly define themselves through a purpose, which is the values of the young Applicant reflects. The more appropriate and credible the purpose statement in the overall context of a company, the higher the recruiting success for value-oriented junior staff and young professionals. Especially for companies in rural areas that suffer from a shortage of skilled workers, the new flexibility of the increasing home office culture is not automatically an asset. The challenges of retaining regionally available specialists are likely to increase – after all, they can also apply nationwide if their profession can be practiced regardless of location.
A positive employer brand, which is also largely defined by a credible purpose and a strong corporate culture, has never been as important as it is today. Anyone who does not enable young talent to identify with the company and its purpose will be left behind in the “war for talents”. Those who, on the other hand, position themselves strategically stringent and honest with a purpose should find suitable employees more easily and bind them to the company over the long term.