(Moral) Corporate Purpose

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What is a Moral Organizational Purpose? Description

In an article regarding moral purpose from Nikos Mourkogiannis, he describes four main ideals of leadership. These can be used for inspiring and leading an organization toward a long-term competitive advantage. According to Mourkogiannis in Strategy+Business, Issue 41, Winter 2005, a moral purpose is a value that, when it is articulated, appeals to the innate sense which is held by some individuals of what is right and what is worthwhile. Great leaders have learned how they can use moral purpose to allow them to inspire and lead their organization toward achieving long-term competitive advantage.

Mourkogiannis distinguishes four categories of moral purpose which are most successful and influential in today's business, with four corresponding ideals of leadership:

  1. Discovery. Here the type of morality is "the new". The moral basis for actions is "I have freely chosen it". The philosophical background for this value was provided by the Danish Philosopher Søren Kierkegaard (1813-1855). Typical examples include innovative, technological companies such as IBM, Sony, Intel and Virgin.
  2. Excellence. Here the type of morality is "the good". The moral basis for actions is it constitutes fulfillment. The philosophical background for this value was provided by the Ancient Greek Philosopher Aristotle (384 B.C. - 322 B.C.). Typical examples include professional and creative companies such as Berkshire Hathaway, The Economist, Apple and BMW. Compare: Clarkson Principles, Seven Signs Of Ethical Collapse
  3. Altruism. Here the type of morality is "the helpful". The moral basis for actions is it increases happiness. The philosophical background for this value was provided by the Scottish Philosopher David Hume (1711-1776). Typical example organizations include many political movements, charities and also Wal-Mart, Marriott, and the Body Shop.
  4. Heroism. Here the type of morality is "the effective". The moral basis for actions is it demonstrates achievement. The philosophical background for this value was provided by the German Philosopher Friedrich Nietzsche (1844-1900). Typical examples include ambitious and daring companies such as S.G. Warburg, Microsoft, Ford, and Exxon Mobil. Compare: Strategic Intent

Each moral purpose, in its own way, compels the people who work in that organization to rewrite the rules of their industry's game and generate unprecedented results. It should resonate with the sensibility of customers, employees, and other constituents.

Origin of the Moral Purpose tool. History

The four moral purposes are based on the philosophy traditions as mentioned above.

Usage of the Moral Purpose framework. Applications

  • It contributes to employee morale by establishing a feeling of community and common meaning which is grounded in mutual respect.
  • It fosters innovation by sensitizing people to market conditions and opportunities.
  • It counters risk-aversion in large companies. People are stimulated to search for solutions within the framework of the chosen moral purpose.
  • It provides a unifying theme that allows people to understand and facilitate the complex fit between the organization and its actions, assets and strategy.
  • Company leaders must manage and align the moral purpose with the strategy. The nature of the moral purpose should help the company to advance in its environment.

Strengths of Moral Purpose thinking. Benefits

  1. As stated above, a moral purpose contributes to employee morale, fosters innovation, counters risk-aversion and it provides a unifying strategic theme.
  2. Also: moral purpose is where the big money is made. Outstanding long-term results can be achieved.
  3. It reveals the underlying human dynamics of a firm, which are very important to employee motivation and behavior.
  4. Strong and lasting communication message, especially for CEOs.
  5. Strong basis for achieving strategic breakthroughs.

Limitations of the Moral Purpose categories. Disadvantages

  • There are a number of other moral ideas besides the main four which are described by Mourkogiannis. These include the belief in equality and universal justice, religious morality, obedience to authority and precedent, and patriotism.
  • However these other ideas do not in themselves inspire employees in ways that would make these concepts useful as moral purposes for most competitive firms.
  • Other moral purposes may become a dominant model over time or when circumstances change. Compare: Spiral Dynamics, Contingency Theory
  • The framework of Mourkogiannis is clearly a realistic and a Instrumental Approach to corporate purpose.

Assumptions of the Moral Purpose theory. Conditions

  • Effective corporate strategy starts by identifying what moral purpose is closest to the company's strategic intent.
  • The true business leader's significant role is to be in touch with, and to act on, the moral currents that influence his or her colleagues.
  • If a company's corporate purpose is X, its strategy can not be Y. It will not work and it might even be harmful.

Book: Nikos Mourkogiannis - Purpose: The Starting Point of Great Companies

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Information Sources

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Compare with Moral Purpose: Ashridge Mission Model  |  Seven Signs Of Ethical Collapse  |  Strategic Intent  |  Clarkson Principles  |  Intrinsic Stakeholder Commitment  |  Strategic Stakeholder Management  |  Seven Surprises  |  Stakeholder Value Perspective  |  Shareholder Value Perspective  |  Spiral Dynamics  |  Contingency Theory

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