The purpose of the company establishes the priority of investments in new products, markets, and marketing channels. Companies that clearly communicate their purpose attract their target customer.
Purpose powers productivity through prioritization. Yes, I'm pretty proud of myself for that alliteration.
Prioritization creates focus. Mission, vision, and purpose are all aspects of how the company defines what it is and what it is not. This sets the boundaries and criteria for all other decisions. Companies that clearly communicate their purpose attract their target customer.
All this becomes very practical when allocating scarce financial resources. The purpose of the company establishes the priority of investments in new products, markets, and marketing channels. Without purpose, there are no criteria upon which to evaluate different investments.
This lack of clarity causes a company's efforts to become diluted. Inferior investments detract from the focus needed to achieve success, as defined by the company's purpose.
I was the CFO of a community health clinic system. Our mission, as defined by the community partners that formed us, was to provide medical, dental, and mental health services. We had a transitional housing program that related very indirectly to our mission. We soon realized transitional housing was funneling resources away from our primary mission, so we decided to exit the program. Ending the housing program freed up more time and money for our mission.
I wish you priorities based on purpose for better productivity and profit. I wish you well.
- Rob Stephens
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