What is an organization’s Purpose?

The Purpose of an organization is the fundamental reason why the organization exists.

purpose of the organizationThe Purpose of an organization is not the answer to the question “What do you do?” which typically focuses on products, services and customers, but rather the answer to the question “Why is the work you do important?” Employees should find the Purpose inspirational and motivational. It is the cause that defines their contribution to society through work. Businesses exist to make a profit, but they also exist to make a difference. Through work, individuals can make a difference and be part of a meaningful legacy.

In the words of Andrew Mason, the former CEO of Groupon,

“When our customers started telling us, ‘I love Groupon because it’s getting me out of the house, making me live my life,’ is when we realized the full impact of what we were doing.” He continues, “We’re not in it for making money. We’re in it for the passion we have for big ideas, making an impact and making the world better.”

Work should be purposeful and meaningful. It should contribute to making the world a better place.

Work should be more than a job. It should be a cause that’s making a difference in people’s lives.

A Purpose statement should be brief in length yet broad in scope. Make it brief so employees can remember it and use it to guide their daily actions. The Purpose should also be broad in scope to allow the organization to adapt over time to a changing world while its central focus remains constant. Products and services may change, but the organization must endure. Organizations are living entities; they are vehicles for improving life and the world we live in.

The Six Criteria for a Purpose Statement

  • Is it a contribution to society – not a product or service?
  • Does it answer the question – Why is this work important?
  • Is it inspirational and motivational?
  • Does it use powerful words?
  • Is it brief in length so employees will remember it?
  • Is it broad in scope to allow for future opportunities and change?

Download this worksheet to use when evaluating Purpose Statement options: Purpose Statement Options To Be Evaluated

Key Points about Purpose


  • Is central and enduring to the culture of the organization.
  • Is the cause that defines one’s contribution to society.
  • Unites efforts and inspires action.
  • Is the answer to the question: Why is this work important?
  • Is a statement that is brief in length and broad in scope.

purpose of an organization

Examples of Purpose Statements

Bank We  help people achieve their dreams
Beverage Company We benefit and refresh
Bread Company We nourish life
Communications Company We enhance image
Entertainment Company We make people happy
Food Company We nurture health and well-being
Internet Company We connect people to power and possibilities
Medical Group We preserve and improve human life
Non-profit We reduce poverty

Purpose examplesIn addition to the examples above, here are a few more examples of Purpose Statements:

  • Chemical company: to improve living environments
  • Library: to connect people and information
  • Financial company: to build value
  • Technology company: to help realize one’s full potential
  • Insurance company: to provide peace of mind
  • Consumer products company: to make life fun and easy

To discover how to view Purpose more broadly, go to this post.

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