I have two daughters.  This weekend, I found myself fielding the following questions (among others): “Dad, why don’t people share their homes with homeless people?” “Why did the first world war start?” “Why do I need to do maths when I have a calculator on my phone?” “Dad, why do I need to lay the table, why can’t Evie?” And the classic question “Dad, why are you so embarrassing?”
 

Neither of my daughters stops asking why.  So why do we often avoid asking it in business?  This seems especially relevant in today’s climate, as people question the role of capitalism in the face of the societal and economic challenges of today.
 

The simplest definition of business I know is to sell a product or service to customers for more than it costs to make and deliver.  This answers the question “what?” 

Often companies leave it at that.  Some may thrive and survive because the founder is charismatic enough to persuade people to follow them.  Perhaps there is a gap in the market that can simply be filled.  But this risks the company dying when the founder leaves or competitors also work out how to fill the gap.  Think Woolworths, the first mass-market discount retail phenomenon of the twentieth century that is now no more.  
 

It doesn’t matter if the core purpose is captured in a mission statement, a vision, a set of values or across all three.  Sustainable company outperformance will only happen if employees know not just what they need to do, but also why they are doing it.  And a company purpose helps with this if it informs decision-making at all levels of the organisation.
 

Ask yourself this – if your company has a purpose, what would be different if it did not exist?  Nothing?  Then perhaps it is time to think again.
 

Take some examples.  One organisation I know has no purpose written down, but everyone knows why they join and stay, “despite everything” - the National Health Service.  John Lewis has recently been in the news because of its management restructure.  Whereas so many focus on the first half of their purpose, the reasons for this restructure are nevertheless captured in the second half - “the happiness of all its members through their worthwhile and satisfying employment in a successful business”.  Amazon may be much more than an online bookseller these days, but the diversification has a direct connection back to the heartbeat of “aspiring to be the earth’s most customer-centric company”.  Virgin has had a long-held purpose of “changing business for good”, which again acts as an umbrella for how it sets up its diverse range of businesses.    
 

I don’t know how these examples have translated to everyday decisions.  Certainly, I am sure there are examples of these companies failing to live up to their purpose at certain points or through certain teams.  But it strikes me they are still going strong because, at the very least, they do see great opportunity through the prism of their purpose.

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At Howdens, our purpose - to be worthwhile for all concerned - does inform decision-making.  It means we invest heavily in stock in all our depots, so our customers (we’re trade-only) know they can turn a job around quickly; we also give them credit terms so they aren’t out of pocket while they wait for their own invoices to be settled.  It means everyone in each of our depots shares in the profits of their depot and is directly compensated for the work they put in.  And it means we liberate our depot managers to respond to local needs, and provide the best possible price and service for customers and in turn, our customers’ customers.

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So don’t just ask the question why.  Answer it and make it real every day for all employees.

And when you’ve done that, let me know if you have any answers to my daughters’ questions.  I’m still scratching my head.