The key to unlocking your company’s growth potential

When Ranjay Gulati, professor of business administration at Harvard Business School, started working on his latest book he initially intended to name it Goal. But he soon realized he needed a new working title: During his research and writing process, he discovered that many companies like to talk about the goal, but few support it with their actions. For those few successful companies that made the move, “it wasn’t just a statement of purpose, it’s a way of being, it was something that laid the foundation for everything they did,” says Gulati.

That’s an important distinction, and it explains why Gulati ended up giving the book the title: Deep target. At the virtual Purpose Power Summit of businesstraverse.com. On Tuesday, StrawberryFrog founder and CEO Scott Goodson spoke with Gulati about the idea behind his new book.

In its most basic form, Gulati says, a company’s purpose is a general intention about how you want to be in the world. A deeper, thoughtful purpose helps leaders set and achieve goals, not to mention pursuing a long-term vision. In other words, the goal is an important part of unlocking the growth of your business.

But how? For Gulati, the answer is multifaceted.

1. Your people are more motivated.

A deep goal will help you attract and retain employees who align with your company’s mission, and it will make them more productive. According to a 2015 study by Harvard Business Review, inspired employees are twice as productive as satisfied employees. “When they[employees] connecting their purpose with the purpose of the company, you get a different kind of person showing up,” says Gulati.

2. Your customers feel more connected to your brand.

Customers care more than ever about businesses with purpose. They want their purchases to support brands that play a positive role in the communities in which they operate. The more you can connect with customers on a target level, the more trust and loyalty you build.

3. Your business is moving from transactional to relational.

Partnerships, suppliers, customers, employees: running a business today involves many moving parts and many relationships. Think of this as your business ecosystem. Gulati says having a deep purpose builds stronger relationships, which in turn strengthens your ecosystem. He says this transition will look like a “change of a company from an economic vision to a nexus of contracts”, where everyone is looking for their piece of the pie, to a “nexus of obligations” where everyone is working towards that deep purpose.

4. You always have a true north to guide your next moves.

Gulati says, “The target is a compass.” The ups and downs of running a business can be brutal, but a deep goal will keep you on track no matter the challenges you face.

Finally, says Gulati, for leaders, a well-developed purpose helps them to be more than just operators – they become inspirers. And that applies not only to inspiring employees in their daily tasks, but also to inspiring them to work towards their own deeper goal. That’s how leaders cultivate and grow their teams while building a purpose-driven business from the ground up. Borrowing from Stanford University professor emeritus James G. March, Gulati says the world “needs leaders, plumbers as well as poets.”