The Purpose of a Business

PurposePeter Drucker famously wrote in The Practice of Management that the purpose of a business is to create and keep a customer.

While that may indeed be true, it’s the bare minimum and something that’s required to keep the doors open (unless you’re VC funded.) I think to aim there as the purpose of a business is to shoot terribly low.

I believe the purpose of a business is to create and keep purpose.

While purpose can be a loaded word for some, I think that in this day and age businesses that are built to do something that people can rally around, regardless of what the company actually makes and sells, are the ones that will naturally experience growth.

Organizations that can foster and communicate, what I called in The Referral Engine, a higher purpose, will always attract employees, customers and opportunities that are drawn to that higher purpose. Attempting to serve an organization’s higher purpose is also a great way to maintain business focus when stricken by the idea of the week.

Some of the most successful brands today, Apple, Zappos, and Southwest, have captured people’s hearts and imaginations around simple purpose. Now purpose doesn’t always mean a “noble” cause as we might traditionally think about it. Purpose can be an innovation that attracts, a culture that attracts, or a single idea like trust.

People commit to companies, products and stories that are built on and positioned with a simple, easy to communicate purpose – we commit to things we believe in and companies that get that make their entire marketing about purpose instead of product.

  • 37Signals is an anti software company that happens to make the simplest software on the planet
  • Evernote is trying create memory as a platform and build universal trust around data
  • Zappos is about customer service and they happen to sell shoes
  • Southwest just makes all the other airlines look silly by doing things that seem normal
  • Apple makes computers for people that want a simple, intuitive, stunningly designed experience

I propose that commitment to a product, service, company or job comes from connection and connection comes from making a business about a single minded purpose that happens to sell something.

So, what does this mean for your business? Can you discover a purpose greater than simply creating a customer, can you create a business, a culture, built to communicate that purpose? What might change if you did? What organizations could you model your working on purpose business upon? How can you draw people to commit and connect to your higher purpose?


commit, purpose

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