Is your organization fit for purpose?
Do you run a purpose-led company? If not, I invite you to start exploring this field, because a meaningful higher purpose can not only help you answer the question why you are in business, but also provide you with a powerful navigation instrument in a VUCA world – and help build Better Business and a better future for the generations to come.
Still, many companies seem get stuck in something more similar to purpose-washing on the way, as they don’t live as they preach. What they often seem to miss is to fully align the key building blocks of their business to the higher purpose. The Fit for Purpose Model is designed to help you avoid that.
The Fit for Purpose Model
The Fit for Purpose Model represents five essential building blocks of Better Business. All building blocks need to be aligned with your purpose – and each other – for you to be trustworthy as a leader and as a business.
The model was specifically designed to help you as a business leader strategically align the higher purpose of your business with your business and operating model. It is inspired by my own 25-plus-years of business experience and the research for the Better Business Better Future book, but also by several business thinkers who have already created powerful ‘business mind maps’, such as Simon Sinek (Start with Why); Roger Martin (Playing to Win); Alexander Osterwalder and Yves Pigneur (Business Model Generation) Oliver Gassman, Michaela Csik and Karolin Frankenberger (The Business Model Navigator); Jonathan Trevor (Align); the Better Business Blueprint, and others. I have already used the model as part of client strategy projects and iterated it back and forth through multiple rounds of client feedback with good results.
The five building blocks of the Fit for Purpose Model:
- Why the company exists (its purpose);
- What it offers (e.g., valueproposition, brand, products and services);
- Whom it serves (e.g., target groups and key stakeholders);
- Where it operates (e.g., geographic presence and channels);
- How it operates (e.g., organization, culture, people and competencies, rewards, systems, processes and value chain).
An integration and alignment of these different building blocks is key for purpose-led companies to deliver on their purpose. You cannot for instance have a sustainable value proposition if it is not supported by how you operate (that would simply be called ‘greenwashing’). Also, a higher purpose that is not supported by your operating practices simply leaves employees cynical and disengaged.
Let’s take a look at an example of a solid integration.
Patagonia’s integration of its higher purpose
Patagonia started as a quite regular business and has over time evolved into a sustainability trailblazer. Today its business and operating model is completely designed around its updated purpose, which is to save our home planet.
In summary, the five building blocks of Patagonia can be described as follows:
Why we are in business:
- To save our home planet.
What we offer?
- High quality, long-lasting minimalist style outdoor clothing and gear under the Patagonia brand.
- Added services for consumers to repair, share and recycle used Patagonia gear.
- Environmentalism and anti-consumerism as part of the brand identity.
Whom we serve?
- Primarily men and women with disposable income, valuing high-quality products, having an active lifestyle, enjoying nature and the outdoors, as well as the conscious consumer.
- The planet and society as a whole.
Where we operate?
- Head office in Ventura, California (US).
- Outsourced production in 16 countries.
- Go-to-market direct to consumers and via distributors, and reaching hundreds of stores in more than ten countries across five continents.
How we operate?
- An activist culture and mindset inspired by environmentalism and anti-consumerism.
- Operational focus on building the best product, causing no unnecessary harm, and in using business to inspire and implement solutions to the environmental crisis.
- Safeguarding the highest standards of sustainability (a Certified BCorporation since 2012).
- Experimentation with regenerative practices.
- Donating one percent of annual revenues to non-profit charities.
- High employee satisfaction and engagement, and 91 percent of employees saying that Patagonia is a great place to work.
As you can see, the Fit for Purpose model is straightforward and easy to apply. It helps to overview the whole and to identify potential misalignments. You can apply it to your business too. It will help you identify potential misalignments, and in building a more authentic, coherent and integrated business.
A great model to explore future options
The Fit for Purpose Model can do more than help you align your business with your purpose. Its building blocks can also be utilized to explore different future options – and sets of choice – for your business as part of your next strategic review. What will be your future role in the context unfolding?
Read more in the book Better Business Better Future by Elisabet Lagerstedt (2022).