Why do people start a business?
Most business owners have a purpose in mind – they see a gap in the market they can fill; they believe they can do something better; they might have had a bad experience and want to make a difference in their industry, their market or the world. Money plays a part of course – business owners want to drive wealth and often want to create an entity that has value that can be sold or passed on.
Welcome to the first in my Growth Metrics series of articles, which I hope will help point you to ways you can grow your business and just as importantly, enjoy the process. I'll share my experiences and insights from working with a wide range of clients, illustrated with practical examples of strategies that have been proved to work.
We start with purpose. Purpose is at the core of any successful business.
Entrepreneurs are by nature people who want to create something – they are purpose driven.
So what do we mean by purpose – how do we define it and how do we articulate it? I see three elements to business purpose:
Every business exists to serve a particular target market. The first element of understanding our business purpose is to have absolute clarity on who it serves; who are the people and organisations that we are here to help.
Many of us are familiar with the notion of 'Find your why' – understanding the very essence of what drives us to do what we do. Understanding the 'Why' that drives us is the second key element of our business purpose.
The who and the why combine to lead us to the third element of business purpose: value exchange. Value exchange is at the heart of all successful businesses – if we want to create wealth, we have to give our customers something that they value more than the price they pay for it. The more people we can impact in this positive way, the more successful the business and the wealthier we become. A successful business is one that creates the maxim um value exchange with the greatest leverage, whilst having the most amount of fun.
It is not always easy, from inside our business, to fully under stand the value the customer receives, so I recommend going straight to the source and asking customers for their input. They often have a clearer perception of our value than we do, and hearing it can be an enlightening process.
When a business knows who it serves, why it exists and the value it offers, things start to fall into place. The business entity has a purpose beyond the intention of its owner, a purpose that can be summarised in the formula:
(Who + Why) x Value x Fun = The purpose of business
The conscious acknowledgement and leverage of purpose drives the higher context of our business – it defines its real meaning and how it changes lives. Our higher context is what engages with and connects people, providing a 'guiding light' for the business. It is the fundamental matter of our business and therefore also known as our 'business DNA'.
Business DNA is the foundation for a powerful brand led strategy - a topic I'll cover in depth later in this series.
Building the right team behind your brand
The ability to articulate our purpose, or DNA, helps us, as entrepreneurs, to identify and recruit people to come on the business journey with us, whether as partners, employees, suppliers or investors. By communicating the business purpose, we attract people who share our vision and passion and will have a positive influence on the business.
Drive and Positivity
Purpose is what gives energy to the business owner - building a business can be a hard slog and many would-be entrepreneurs fall by the wayside. Those with a clear purpose have the vision to keep going through the inevitable pitfalls. A clear purpose and higher context helps the business to operate in a positive space, removing the negativity that can cause dissent, disagreements and ultimately business downfall.
An authentic, clearly understood and articulated purpose is the very heart of a successful business, enabling it to change lives – those of all its stakeholders.
Purpose is the 'Secret Sauce' - the very flavour of business success.
Tim Dwyer is a business growth expert, who specialises in helping businesses strategically grow their assets, increase their business value, and improve their capabilities. Tim would welcome the opportunity to share more with you about Growth Metrics for business. You can contact Tim, and read more of his business insights and advice via his profile and learn more about Growth Metrics here.