February 3, 2019

Purpose Part II: Key elements of a good company purpose

Purpose Part II: Key elements of a good company purpose

In our previous article, "Why Every Company Must Establish a Clear Purpose, " we outlined the impact that having a clearly defined purpose in your company has on its success. This article goes into more detail about the important elements of any good company purpose.

What are the key components of a purpose?

Every good company purpose contains these three elements:

  • Mission - a statement about why the company exists and what it does for the world. It should not be about product or solution; rather, it should focus on answering the critical question of "why was this company created in the first place" and "why do we continue to do what we do everyday?"
  • Vision - an aspirational statement about what your company will accomplish in the long run. For example, Salesforce.com's original 1999 vision statement was "Rapidly create a world-class Internet company / site for sales Force Automation."
  • Values - these are the meat and potatoes of your organization. They help to give your people clarity on how to make specific decisions. There are several good examples of values. One of our favorites comes from the conversational marketing company Drift.

    An important thing to remember about values is that it is less about the substance of the values (as long as they make sense for your specific business and align with the rest of your company's purpose), but rather that they're universally understood and subscribed to. They're useful for rallying your people around a common understanding of what the company stands for.

In addition to mission, vision, and values, we also suggest companies consider adding the following components to their company's purpose:

  • Thesis / Theses - an organizational thesis is a brief statement about how your company views the world. It provides insight to something that the company knows to be true about the world. For example, at Minsilo, one of our core theses is:
One of the greatest untapped opportunities for companies is a deep understanding of behavioral psychology and how to design products and businesses that are aware of the human element.
  • Mantras - a short (only a few simple words) statement about your company. One of my favorite examples is from my last company, where we asked ourselves regularly "is this 500 strong?", referring to our previous company-wide goal of getting to 500 customers. It helped us make decisions specifically around product.

    I first learned about mantras in Guy Kawasaki's book The Art of the Start. One of the major takeaways from Guy is the importance of brevity; the mantra needs to be so simple that everybody in the company can remember it exactly and can understand what it actually means. They should absolutely not be filled with corporate speak (and, for that matter, neither should your mission statement).

Resources

Here are some particularly useful articles, books, and other resources to investigate regarding company purpose.