We are all accustomed to answering the question “What do you do?”—and we usually have a pretty good answer. But rarely do we hear “WHY do you do it? What is the purpose for your business, the reason you started this journey called entrepreneurship (whether that journey began decades or weeks ago)?”

Or another way to ask that question (the George Bailey version of the question): “What would your community look like without your business? What does your business contribute to your community, industry, clientele that no one else does? How do you create or add value for your customers and your employees?”

For most non-profits or charities, purpose is crystal clear: feed the hungry, shelter the homeless, educate youth, save the whales, clean up rivers, etc.

For-profit entities on the other hand, sometimes struggle to answer this question succinctly. There’s usually something about serving the customer, or producing an exceptional product, or excelling at XYZ. Some organizations refer to their mission statements to define their purpose. Purpose isn’t necessarily always about social impact—although often there is a social aspect to defining a company’s purpose.

For some business owners, creating a business can be a way to build the world they want to live in. In other words, building your own company gives you the freedom to create a small space that reflects how you would like the world to be—more inclusive, more respectful, more creative, healthier, more productive, more constructive, more supportive, more…whatever. As a business owner, you have the chance to shape a little part of the world into a good place to live. As you build your business, your purpose will help guide how you develop your people and nurture your culture.

Identifying your company’s purpose, embracing it and championing it within your organization is important. On an operational level, your business’s purpose helps answer questions about what type of business entity will you set up, how you will organize and manage your people, what type of leadership you will need, even where you will locate the business. (i.e. if your purpose is to create unique surfboards for professional surfers, you should probably consider moving to a surfing community.)

Being a purpose-driven organization requires first knowing your purpose, communicating it to your stakeholders (internal and external) and then staying true to it. In our next installment, we’ll tackle 5 “How to” ideas for communicating your purpose and incorporating it into your daily operations.

In the meantime, ask yourself these 4 questions about your company—(Hint: the answers should all help you understand and fulfill your company’s purpose):

  1. How can we add or increase VALUE?
  2. How can we enhance or change how we APPEAR?
  3. How can we elevate or improve how we PERFORM?
  4. How can we continuously LEARN and GROW?