What Are We Here For? – The Real Purpose of Initiatives

Businesses fundamentally exist to generate profit. Regardless of their vision, mission, or intentions to disrupt industries for the better, the bottom line is what sustains and propels them forward. While this may seem like a glaringly obvious statement, it’s remarkable how easily this fundamental truth can be overshadowed by other factors.

In the early stages of a business, operations are relatively straightforward: offer products and services, attract customers, manage expenses, and strive for profitability. At this point, the organization is usually small, closely intertwined with its customer base, and efficiently structured.

As a business expands, it faces the imperative to broaden its market reach, diversify its product offerings, and maintain profitability in proportion to its growth. This expansion often triggers the introduction of hierarchies and governance structures. Departments are created and scaled, gradually becoming detached from both the customers they serve and each other.

Entire entities are established to oversee and administer portfolios, programs, or projects (collectively referred to here as initiatives). The farther an organization drifts from its core business, the more perplexing its policies, practices, and existence may become.

So, what’s the consequence of this evolution? Individual leaders and departments may start prioritizing their own interests over what’s in the best interest of the business and its overall customer base. It’s not inherently good or bad; it’s simply a reflection of human nature. After all, businesses are still managed by humans, at least for the foreseeable future.

What often becomes obscured in this process is the fact that every initiative’s purpose is to bolster the primary business function—the path to delivering value and generating profit. As organizations expand, this concept becomes increasingly intricate and convoluted, making it easy to lose sight of why initiatives are created in the first place.

In essence, initiatives are put in place to drive the business forward, whether that means achieving growth, entering new markets, expanding product and service offerings, or diversifying revenue streams. Therefore, before committing substantial resources to the implementation of a flashy AI system or state-of-the-art eCommerce platform, it’s prudent to assess how likely the initiative will genuinely benefit the business.

This may seem like a glaringly obvious statement, but it’s crucial to ask whether our systems for initiating, approving, and executing these endeavors are consistently aligned with the core value path of the business.