How to Restart the Goal Disconnect in Global Business
12 mins read

How to Restart the Goal Disconnect in Global Business

Even though there are other pressing issues, such as combating inflation, the concept of purpose has become a central topic of debate in American business over the past five years.

Recall the Business Roundtable’s famous decision in August 2019 to formally redefine the general purpose of corporations as promoting “an economy that works for all Americans.” Signed by 181 CEOs of some of the largest companies in the U.S., the idea was that they would now run their companies for the good of all stakeholders—customers, employees, suppliers, and communities—and NO only their shareholders.

Tricia Griffith, president and CEO of Progressive Corporation and a leader of the Business Roundtable, captures the essence of the Roundtable’s internal debate that shaped their position: “CEOs work to generate profits and return value to shareholders, but the best-run companies do more. They put customers first and invest in their employees and communities; ultimately, that’s the most promising way to build long-term value.”

Most observers have noted that the decision to make Purpose the official “end goal” of a public corporation represents a sea change from traditional capitalist thinking. After all, Milton Friedman famously declared in 1970 that the sole responsibility of any company is to increase its profits—a view that has dominated the thinking of senior executives ever since.

What’s changed since 2019? The global pandemic and resulting health crisis have changed the way we think about responsibility and the nature of leadership and society. For example, Business Roundtable members collectively donated $863 million in cash to COVID-19 response efforts, exemplifying a shift in how companies see their role in crises.

However, one may ask whether, in the face of current economic and social turmoil, the concept of Purpose still has the same relevance as it did in periods that now seem relatively more stable.

I wonder if, in turbulent times like these, the pursuit of Purpose has the same impact? There are certainly stakeholders who point to the complexity of putting the idea into practice; leaving me to wonder — can Purpose scale across international organizations?

For example, in 2023, Unilever CEO Hein Schumacher stated in his company’s annual report that while the company’s focus on “purpose” is commendable and inspires many people to join and stay with the brand, so “we can never lose that,” he also warned that “I don’t think we promote purpose by forcing it on every brand.”

It seems that others share this belief. A 2023 survey of 1,000 business leaders found that 70% agreed that its importance had increased over the past five years. Furthermore, 89% of CEOs contacted said that their organizations definitely have a Purpose, but only 63% use it to make business decisions.

The discussion can be confused with the growing emphasis on ESG (Environmental, Social and Governance) issues; is Purpose primarily concerned with these metrics? Or is it focused on cultivating great EX (Employee Experience) and enriching workplace fulfillment for teams? On the other hand, is it a strategic endeavor to present a meaningful ethos that resonates with younger employees and new hires.

So we want Purpose in business, but we may not have figured out how to make it work and become routine. Perhaps, as the Business Roundtable has called, we need to move beyond the original definitions of Purpose to Purpose 2.0. Reports like this make us wonder whether the lofty original intentions of companies like Google and Apple—(Google) “(To) organize the world’s information and make it universally accessible” and (Apple) “(To) deliver technology (to) elevate humanity and enrich people’s lives in all the ways people want to experience it”—have led to a disconnection of purpose.

What a Serial Entrepreneur Can Tell Us About Purpose

I think Purpose is a great idea and I agree that it should be something that can be delivered, but it can be a concept that needs to emerge organically, not some forced implementation. However, at the heart of any business proposition I agree that there should be a commitment to making a positive difference to society.

I don’t have a definitive answer to the Purpose problem because I believe and teach executives that purpose in the workplace is fleeting for employees and must be ignited and personally nurtured, situationally for each person, season by season. You must personally bring your own sense of purpose to the workplace. One way I teach this is through play and juggling the fleeting experiences that exist in the interconnected fabric between Fun, Money, and Influence.

In addition to my teaching on the subject and my experience managing companies as a serial CEO, I have met and interviewed dozens of CEOs and serial entrepreneurs who have made an impact on business, society, and their employees, such as John Chambers, Sridhar Vembu, and Bracken Darrell, to better understand what we can do to make this Business Roundtable slogan a reality.

I spoke with Joel Hyatt, of Hyatt Legal Services fame. Over the past two decades, Joel’s groundbreaking startup ventures have disrupted the worlds of law, media, and now technology. He has effectively democratized legal services. Back in the 1970s, lawyers weren’t allowed to advertise, an archaic ban that he more or less lifted on his own, helping the general population finally have easy access to good legal services on the open market.

It seems like he was just getting started. After winning an antitrust case that shattered some of the great media strongholds and rules, he and Al Gore launched Current TV, which pioneered user-generated content from 2005 to 2013 and went on to win Emmys, Peabody Awards, Livingston Awards, investments from Comcast and DirecTV, etc.

Not content with the positive changes he had made for the participants in two incredibly important pillars of American life and business, Joel decided to tackle yet another one: supply. Supply—we’re talking about a sector that needs Emmys.

While public procurement may seem less glamorous, it is in fact a hugely important area that, if properly “disrupted,” could significantly improve the working lives of millions of people. At the same time, it would provide small and medium-sized enterprises (SMEs) with unprecedented opportunities to secure lucrative contracts with larger corporations that were previously invisible to them.

Using Artificial Intelligence to Solve Social Problems

Joel’s latest venture, Globality, aims to streamline and improve the procurement process for businesses. Using both machine learning and generative AI, the company offers something completely unique that it calls “autonomous self-service sourcing.”

And interestingly, this isn’t some VC-backed startup from 2024 jumping on board the AI ​​bandwagon. Joel has been slowly developing the solution over the years, learning what works and what doesn’t, and more importantly, building an impressive global client list that includes the likes of Fidelity Investments, T. Rowe Price, Adidas, BT, Tesco, and Santander Bank.

Just a money-making venture, as Friedman said the company should be? Yes and no. Joel saw an opportunity. But it turns out that at every stage of his career, Purpose has seemed to be the priority, noting, “There’s nothing more exciting than taking an idea, making it real, building something that’s important and that addresses an important need, building teams, creating a culture, adding value—but every time I’ve started a company, it’s been about identifying a social problem and believing that there’s a private-sector solution that could solve that problem and have a positive impact. Every single one of my business stories started with that.”

The democratization of industry has an undeniable dissatisfaction

The genesis of Globality once again comes from a social question: How can we make globalization work better? In other words, how can we push the benefits of globalization deeper into the world’s economies, thereby helping more people and businesses?

“Globalization has undoubtedly benefited many, many people,” he says. “More than two billion people in the developing world have been lifted out of poverty because of its impact, because the costs of goods and services around the world have fallen because of it.

“Yet many people have become lost in the rapid changes associated with the transition from national to global economies, from manufacturing-based to service-based economies, and from analog to digital economies.”

Joel points out that people who have been adversely affected by the forces of globalization have seen many well-paid middle-class jobs disappear. “Public policy has not really helped these people survive these changes,” he says. “So what has happened is a populist uprising against globalization; people have come to believe that it only benefits the rich and the powerful and the elites.”

The right answer, he says, is to make sure the benefits of globalization are more transparent, so that diverse supply chains become clear and help more people. “The way to do that is to enable smaller companies to actively participate in the global economy.”

Since we all live in a digital world, why does a company have to be local, regional, or even national: why can’t it compete for business worldwide? Why can’t small businesses become giants Fortune 500 companies as clients? Why can’t a company in Milan sell to an American company that wants to run a marketing campaign in Western Europe?

“So we built an AI-based platform to do that, and when we launched and talked to the big companies, we said, ‘Listen, you should buy from smaller companies, you should buy from diverse companies. You should buy from local companies in multiple countries where you do business.’”

“And that’s what we’re doing today. We have companies around the world now spending billions of dollars on our platform. We’ve built a transparent, fair, new ecosystem for how companies do business together, and I’m very proud of that.”

Enabling every employee to make an impact

Many believe that AI has the potential to globalize the economy in such a way that more entities than just large companies will participate in it.

Reinforcing how much of a Purpose that is in practice is also a mission that Joel’s employees believe in. “I think the reason we attracted this talent is not just the size of the opportunity that we saw, but the importance of that purpose,” he says. “The idea that we can change the way we do business, that we can build a new ecosystem for global trade, that we can enable every employee in a company to do a better job for their company, and that we can create new, good jobs in smaller companies as they grow to become global, makes all of our people feel good about how they’re using their talent.”

People want purpose in their professional lives, and smart leaders are starting to provide their employees with platforms (opportunities) where they can start to experience that. As more employees experience purpose, so will customers, suppliers, communities, shareholders, and stakeholders.

And if Purpose can galvanize and inspire more leaders like Joel Hyatt and create more companies like Globality, then I think this idea will be with us for a long, long time.