Purpose matters, but it’s not tied to better business performance.

By Jacquelyn Kung

A lot of us (me included) opine that people stay working and engaged in our industry because of the mission and purpose of what we do.  

Moreover, many of us (me included) opine that engaged employees mean better business performance.

So you would think that the organizations in our sector who really underscore their mission and purpose are the ones that perform better, right?

Well actually, that is . . .

Exactly Wrong

A group of Harvard, Wharton, and Columbia business school professors published a notable piece in the Harvard Business Review that we can learn from. Here are the highlights:

Purpose matters, but it’s not tied to better business performance. It’s only when there is purpose AND management clarity that businesses outperform. What’s more, for “management clarity,” it’s the middle management layer that matters in determining success for each community (as measured in occupancy, revenue growth, NOI).

By the way, here is a side box for the nerds. Purpose is measured by employee statements such as:

  • “My work has special meaning: this is not just a job.”

  • “I feel good about the ways we contribute to the community.”

  • “When I look at what we accomplish, I feel a sense of pride.”

  • “I’m proud to tell others I work here.”

It turns out this is simply NOT enough. It’s only when these two additional statements, also score high:

  • “Management makes its expectations clear.”

  • “Management has a clear view of where the organization is going and how to get there.”

And lastly, here is a critical excerpt from the HBR article:

“We also found that middle managers . . . seem to be the key players in driving this relationship, not hourly workers and not top executives. This last finding underscores the absolute importance of fostering an effective middle manager layer within firms: managers who buy into the vision of the company and can make daily decisions that guide . . . in the right direction.”

As many executives in our industry have underscored, it’s the middle manager layer – those managers, supervisors, and team leaders, in our communities – that are the make or break for a community’s performance.

So ask yourself, how are your managers, supervisors, and team leads imbuing your organization’s expectations and goals to others on your staff? Would staff say their communication is “clear” and with a “clear view” of “how to get there”?

There are tens of thousands of surveys in the industry that support this, and we’ll have more data and research to share, but we wanted to get this article to you ASAP – hot off the press!

This means more good stuff is coming.