Over the past 5 years, firms have been busy prioritising commercial strategies to withstand turbulence and strengthen their footing. But times have changed. Employees expect more. Clients expect more. They want legal solutions that add value and solve business challenges. Employees also want more than a job, they want a reason to work. Purpose, as demonstrated by a firm’s commitment to its values and the actions of its leadership, is a platform for satisfying both. And that means it is also vital for navigating this current period of economic, political and societal volatility.
What is purpose and why is it so powerful?
Purpose can be thought of as being a company's “why”; its reason for being and contribution to the common good that guides decision-making and operations.
It’s powerful because being a part of something greater than oneself is highly motivating. A firm with purpose is also easier to trust than one whose only motivation is revenue growth or maximising shareholder value. And, during times of volatility, a strong purpose helps maintain a clear sense of direction — it provides something to aim at, no matter how rough things get.
Of course, it also helps that purpose appears to be good for business. As EY has reported in ‘Why businesses must harness the power of purpose’ there is a growing body of research that suggests “purpose-driven companies make more money… and are even better at innovation and transformational change”.
Indeed, the Business Case for Purpose, a report by Harvard Business Review and sponsored by EY Beacon Institute, found that 58% of companies at which executives said there was a clearly articulated and understood purpose, reported growth of 10% or more in the previous three years. That compares to 51% where purpose was said to be understood by some areas better than others, and 42% where purpose was not well understood or communicated.
Why purpose matters so much now
The sources of volatility affecting the business landscape for law firms were expertly captured by Sarah Walker-Smith, CEO of Shakespeare Martineau at the most recent Multilaw Global Conference. They include the global supply side economic crisis, which is impacting talent availability; geopolitical and climate crises, and rising inequality.
Against this backdrop, Sarah’s unique insight was that firms’ traditional toolbox of responses to major challenges — a clear strategy, strong brand, improved tech — will not be enough this time.
Some or all of these factors remain relevant. But post-COVID, which drove an accelerated humanisation of the workplace, old concepts such as B2B and B2C are fading from relevance. All business today is P2P: people to people. And people, whether clients or staff, are driven by purpose now more than ever.
Putting purpose into action
So, with the business case for purpose now stronger than it has ever been, how can you define your firm’s purpose, communicate it to staff and clients, and ensure it remains relevant and engaging?
Before we get into practical steps, there is one important guiding principle to remember: your purpose doesn’t have to be world-changing. Something realistic and relatable, built around your unique skills and characteristics, will always be more powerful and impactful. You might struggle to take on world poverty or global climate change alone, but you can certainly address inequality or sustainability in your market, industry, or local town.
Here are four actions your firm can take to both better understand its purpose and begin putting it into action.
1Be detailed and don’t rush.
Be sure to invest an appropriate amount of the firm’s time — especially that of leaders — in thinking and reflecting on your purpose. Your purpose might have a catchy title or tagline (or it might not), but you also need to be able to define it in a high level of detail. After all, it guides everything you do. Be sure to include the points of differentiation that mean your firm can make a unique contribution to your goal.
2Communicate, widely and often.
Communicate your purpose widely and often, at all levels, by using it to frame important strategic initiatives, the clients you choose to work with and the industries you work in. As the firm’s reason for being, your purpose needs to become so ingrained in the thinking and actions of staff that it is almost a reflex. That will take constant reminding — but not nagging — reinforced by visible connections between the work they do and the firm’s overall purpose.
3Make purposeful decisions.
Purpose can be a powerful tool for deciding where your biggest opportunities as a business are and how to claim them. And making choices that are aligned with your purpose continuously reinforces your values in the eyes of all key stakeholders.
4Monitor and revisit, regularly.
As much as consistency is a vital factor in successfully harnessing the power of purpose, the market landscape is constantly changing, especially at times of high volatility. So to stay relevant it’s equally important to monitor and regularly reassess your purpose.