BrightHouse Berlin was featured in Die Zeit! “Why many companies no longer want to just generate revenue but also want to make the world a better place.” Read our translation below:
We Want Purpose!
Whether a consulting firm, concrete factory, or nuclear power plant operator: Why many companies no longer want to just generate revenue but also want to make the world a better place
Assembly line workers put their boots on with determination. Welders purposefully push the protective masks off their faces. They beam. They are utterly convinced of their employer, touched by their mission. String music builds up, and sonorous voiceovers speak of responsibility, dependability, and what it means to be human.
The nearly three-minute commercial by the U.S. concrete producer Oldcastle is not only intended to convey a positive image of the company. It is also meant to motivate the workforce to believe in their job by showing them their purpose—that is, their meaning or mission. The answer to the question “Why?” Why do we work here? What is the purpose of this concrete producer? Other than producing concrete, that is. That is a question that is currently being asked in many companies.
Companies that want to do good
Companies strive to generate profits—that has been the highest rule in capitalism to date. But it seems to be changing now. For a few years now, more and more managers and companies have been talking about the “purpose economy.” For instance, Danone CEO Emmanuel Faber was recently quoted in The Economist saying “The purpose of this company is not to create shareholder value.” Instead, his group wants to make healthy food accessible to as many people as possible. That sounded like he didn’t even care about revenue and profit any more, but about making the world a better place.
At the same time, HR executives are speaking to their workforces to find out what really drives them, what their employees want, and what motivates them—other than money. Many companies fear that, in times of a shortage of skilled workers, they will no longer be attractive to high-caliber applicants unless they offer a purpose in addition to a salary.
The management consultancy BCG recently announced that their surveys showed that, while 30 percent of the young top talents—that is, the applicants with the best grades, work experience, and international experience—are primarily interested in a large salary and career opportunities, 28 percent of them were what the consultancy described as “purpose seekers” because material values were not the most important thing for them in their choice of career.
And because the term “purpose” is at least as vague as it is important, there have long been consulting agencies that will help managers find out what they actually do in their company—and why.
The vegan consultants
On one of the upper floors of an impressive old building in Berlin’s Mitte district resides Brighthouse, somewhat of an industry leader when it comes to entrepreneurial questions of purpose. Exposed brick walls, all-glass offices, the refrigerator in the kitchenette holds the best and caffeine-richest gourmet sodas. The attractively arranged illustrations and motivational notes hanging in the hallway read “Intelligence having fun”; somebody wrote “I’m vegan” on a sheet of paper and hung it next to it—not exactly the type of notes one would have expected to see in a management consultancy.
The purpose trend originated in the United States, in the start-ups and digital companies of Silicon Valley, which combined the hippie culture and search for purpose with corporations and capitalism. Brighthouse was founded in 1995 by the advertising legend Joey Reiman, who significantly shaped the term “purpose” and also described it in a book with the full title “The Story of Purpose: The Path to Creating a Brighter Brand, a Greater Company, and a Lasting Legacy.”
Brighthouse was acquired by BCG in 2015—by the same management consultancy, that is, that identified 28 percent purpose seekers among young top talents in the survey quoted above.
One of the women helping companies to define their mission more clearly is Aminta Rother. She is 30 years old, studied business psychology in Japan and marketing at ESCP, a private business school. After graduating, she worked at a large brand consulting agency. Brighthouse recruited her when it was planning its first branch in Germany. For about half a year, she has been working at Brighthouse together with psychologists, filmmakers, business graduates, philosophers, designers, and former copywriters. But how does a company find its purpose?
Step one, explains Rother, is always the so-called discovery—using questionnaires and interviews, the consultants identify what exactly their clients do and what motivates their employees. Step two: the articulation. The intersection of the responses and business segments is determined. “We ask ourselves what this company does in the world, and what the needs of society are,” explains Aminta Rother. In other words: Who is this company—and who should it ideally be? Based on the answer, the ambition, or purpose, is formulated. Step three, the activation, looks at the strategy that can be applied to implement the insights. Finally, in step four, embed, the purpose is integrated into the structure of the company.
The outcome can be far more than a solemn film with string music and happy assembly line workers, as in the case of Oldcastle. Sometimes, the work Rother and her colleagues do has immediate consequences for the business. Brad White, CEO of Brighthouse Europe, likes to give an example in interviews: One of its clients, the U.S. drugstore chain CVS, took all tobacco products off its shelves after the consultation. The reason: Tobacco did not fit into the drugstore’s mission of helping people live a healthier life. While CVS made $2 billion in revenue with cigarettes, Brighthouse explains to its clients, 91 percent of customers would prefer to buy from companies with a purpose than one without one. In the long term, having a purpose pays off, even if it means forgoing billions in revenue in the short term.
The pioneers of purpose
One company that had already internalized its purpose and mission long before there were consultancies like Brighthouse hides in an unadorned arterial road next to a commuter railway station in the north of Mainz. Since 1986, the owner-managed company Werner & Mertz has been manufacturing the products with the little green frog: soaps, detergents, scouring agents, descalers, and glass cleaners.
“Holistically sustainable” is written on the wall of the administrative headquarters in wine-red letters. Next to it grow plants; a fountain splashes in front of it in the foyer. Bottles of detergents are arranged in round glass showcases, while the inscription on a cardboard box reads: “Recycle your old mobile phone.” The company’s ecological awareness appears to have become an attitude over the years that binds employees to the company and its products emotionally. One employee told us frankly shortly after greeting us that she thinks less of friends who have less environmentally friendly detergents in their bathrooms.
Detlef Matz, the head of sustainability management, awaits us in the cafeteria. Matz visually contradicts the eco-friendly cliché with his thin mustache and short-cropped hair. “Sustainability is a value that you don’t leave behind at the company gates,” he says. From the assembly line worker to the management level, everyone feels committed to the shared values. In addition, with every new product, every new development, and every new hire, you can be certain: That value holds true. And that also benefits the company, because people who are working for a higher purpose, says Matz, don’t look as closely at the clock around leaving time.
The idea of purpose is thus as clever as it is simple: Motivated people perform better in the workplace than hardened cynics. Purpose is a better motivator than any performance bonus or Christmas bonus. Purpose turns employees into comrades-in-arms.
But that ambition also comes at a price. The longer Matz speaks, the more it becomes clear that, financially, sustainability only pays off in the long term. If, like Werner & Metz, you certify your company building according to high environmental standards, you can save energy and money in the long term. But initially it costs a lot of money, and not every company can afford that. For a listed stock corporation with quarterly figures and fluctuating share prices, a move like that could be economic suicide.
A nuclear power plant company becomes greener
Tilman Zimmer can tell stories about how painful it can be to find a new purpose for one’s company. He is the head of HR at the power company EnBW. His department is called “Leadership, Skills, Transformation”—a name that describes its mission: Few companies have likely had to question themselves as fundamentally in recent years as the energy supplier.
Only eight years ago, EnBW was one of the big operators of nuclear power plants in Germany. The company owned four of the formerly 17 nuclear power plants. When the Merkel administration relatively spontaneously decided to completely abandon nuclear power in 2011, between the nuclear meltdown in Fukushima and the state elections in Bavaria, EnBW lost not only its economic basis but also its direction. “Our traditional business model was thrown overboard,” recalls Zimmer.
But the involuntary upheaval also hat positive consequences: When the company began communicating its activities in wind power, the number of applicants began to grow as well. “We have noticed that the applicants who come to us have a need for purpose,” says Zimmer. “That is significantly more important than 10 years ago.”
To shape the transformation process, the power supplier introduced dialog programs under which over 2,000 interviews have been held with employees to date, from electricians to board members. Although EnBW doesn’t use the word “purpose,” the question is exactly the same, says Zimmer: “What do we have to be like to be successful? What will differentiate us once we have succeeded?”
Zimmer’s department sees itself as a service center meant to help employees develop new skills and adapt to the changing conditions. But the search for purpose is also very helpful for the company itself, because it provides an important standard across all departments—a standard that applies regardless of quarterly figures and strategic stages.
In the modern working world, purpose has a special function: The purpose of a company outlasts any business crisis. It outshines any transformation process, regardless of how many jobs it cuts. It survives any personnel changes on the management and supervisory board. In other words, a purpose has a calming effect in turbulent times.
Whether out of conviction or calculation, having a purpose pays off. A study from the United States shows that companies with a purpose achieve revenue growth over a period of 10 years that is three times as high as that of companies without a purpose.