Putrevu Manasa, MBAparticipant at IIM Bangalore, explores the success stories behind successful leaders and purpose and calls for the use of OKRs (Objectives and Key Results) to help provide a structured approach for business leaders to think about creating a purpose-driven business environment.

Leading with Purpose: Aligning Goals and Tracking Impact by Putrevu Manasa.

In the opening line of the foreword of the book Measure What Matters (Doerr et al, 2018) Larry Page, Alphabet CEO and Google Co-founder says “I wish I had this book nineteen years ago, when we founded Google. Or even before that, when I was only managing myself! As much as I hate process, good ideas with great execution are how you make magic.”

Too often, meetings in the organization end with enthusiasm but a few months later nothing tangible has changed. People love the idea of purpose but only a few know how to lead it and even fewer know how to execute it. While purpose is widely spoken about as a “why” or a mission statement, purpose-driven leadership starts when the individual and company’s mission align and is sustained and translated to measurable results.

How do we measure this alignment? Isn’t measurement counter-intuitive to operating with purpose? Does purpose even lead to quantifiable outcomes? A starting point to answer these questions is to turn to organizations that have successfully translated purpose to measurable business impact.

Why does purpose-driven leadership matter?

There are several examples of purpose-led organizations from big companies to startups which have demonstrated more promising long-term performance metrics. Patagonia is one such company which is led with a mission of ‘Save our Home Planet’ by embedding sustainability in its core business.

Their campaign in 2011 ‘Don’t Buy This Jacket’ discouraged overconsumption, which encouraged consumers to repair gear and extend their lifespan. Patagonia’s campaign challenged profit motive but deepened customer trust and showed that they prioritize value over short-term gains. They were able to generate around $1B in sales each year. They donate 1% of their sales to grassroots organizations and employees also volunteer over 4000 hours for environmental causes each year (Designstripe, n.d.). Their initiatives show companies can fuel customer passion and not just sell products.

The strength of Patagonia’s purpose is not only reflected in its customer base and sales but also in how it manages people. They only have around 4% turnover each year and around 9,000 applicants for the few jobs that open. When evaluating potential hires they read resumes from the bottom up assessing their interests and their connection to nature and ‘culture add’ beyond qualifications.  

Other leaders have similarly emphasized how embodying purpose in business strategy can drive culture and commercial success. Indra Nooyi’s initiative of ‘Performance with Purpose’ transformed PepsiCo to focus on healthier and sustainable products and enabled profitability when the top brands were losing market share. In an interview with BCG (Chatterjee & Klein, 2010), she talks about how the initiative helped to sustain and retain talent during difficult times.

It is evident that there is a ripple effect of purpose-driven leadership where it fosters engagement, and loyalty and drives success. According to a PWC study (Gleeson, 2024), employees working in companies with a purpose-driven culture are 1.4 times more engaged and productive.

Other than the internal engagement side of the equation, customers are also raising their expectations. Companies failing to articulate their purpose might do well in the short term but in the long term, customers demand more from them according to a 2019 Deloitte study (Deloitte Insights, 2020).

The survey conducted in the US, UK, China and Brazil about what consumers cared about while deciding on a brand revealed the top 3 criteria as how a company treats its people, and environment and supports the community in which it operates. These values are directly linked to the purpose of the company and therefore emphasize the importance of purpose-driven leadership.

While some firms evolve into purpose-driven models some are born with purpose at their core. TOMS had a one-for-one business model where they donated a pair of shoes for every pair sold. Although this seemed like a philanthropic initiative it took off very well and resonated with customers when launched in 2006 and sold 86 million pairs of shoes by 2018 (Mainwaring, 2018).

They later faced a decline post 2018 which raised questions on the sustainability of such a model. Its trajectory suggests that purpose should be managed and adapted as a metric with the same rigour as profitability. For continuous alignment, the purpose should be part of the goal-setting process.

OKRs as a tool for making purpose-operational

This is where OKRs (Objectives and Key Results) offer a structured approach.  In ‘Measure What Matters’ (Doerr et al, 2018) John Doer talks about how OKRs transform the goal-setting process and push every leader to think about creating a purpose-driven business environment. They cultivate a system where employees are trained to think about purpose like leaders at every level and not just at the top.

For startups, OKRs help pull the team in the same direction; for mid-sized firms, they clarify expectations and keep people aligned; for large organizations they sustain ambition.

Many organizations use KPIs for their goal-setting process which measures output. Objectives and Key results, in contrast, begin with choosing audacious goals aligning with the purpose of the organization and connecting them to specific measurable key results. This shift makes purpose actionable.

Pioneered at Intel and later institutionalized at Google, OKRs are built on 4 key principles focus, align, track and stretch. Focus encourages teams to filter ideas and limit them to 3-5 OKRs per cycle, compelling them to drill down and commit to what matters and resonates with the purpose. Alignment ensures each team’s OKRs are connected across functions and aligned with top-level objectives for the organization to function as a whole and stay coordinated.

Tracking enables course correction and flexibility which might be lacking in static KPIs. By being flexible the emphasis shifts from when the goal is achieved towards how the goal is achieved. A team that meets targets with fluctuating morale may not signify sustainable growth as compared to a team maintaining momentum with progressing morale.

Finally, by imbibing a culture of daring to fail and keeping OKRs and bonuses separate, the teams are bold enough to pursue audacious stretch goals without fearing penalty. However, OKRs are not without challenges and leaders should avoid common pitfalls such as setting vague objectives and failing to adapt and adjust to requirements. 

While OKRs might be associated as tools for pushing teams to aim higher, their true value lies in their inherent mechanism for making alignment of purpose tangible in day-to-day work. By setting clear, visible objectives, they make it easy to spot when purpose and action diverge, cross-functional teams misalign or individual and organizational goals conflict. OKRs surface this tension during tracking and enable course correction. Unlike cases when results are measured in isolation, OKRs have greater visibility of how teams are progressing jointly.

Google offers one of the best case studies in implementing OKRs as the company scales. The OKR system ensures that team and individual efforts are in alignment with the organization’s mission of “organize the world’s information and make it universally accessible and useful” (What Matters, n.d.). The OKRs cascade down from leadership to individual efforts to ensure cohesion for achieving the purpose. 

When individual and organizational ‘why’ intersect

The true potential of any mechanism is realized only when purpose resonates at a personal level. When an organization’s purpose meets the individual’s purpose, the result is deeper engagement. A 2024 Deloitte study (Deloitte, 2024) shows that 86% of GenZs and 89% of millennials say the purpose is critical for job satisfaction.

The takeaway for leaders is that this alignment needs to be designed, not assumed. It involves identifying individuals whose values connect with the organization from the beginning. A compelling example of this design comes from Walt Disney. Walt Disney’s purpose was to inspire joy and imagination through storytelling. This also became his company’s mission; every hiring, creative and business decision was aligned with this mission from films to theme parks.

By making sure every project and team upheld the same storytelling magic he was able to build a purpose-driven empire that attracted employees and customers alike.

What does impactful purpose-driven leadership look like?

Purpose must be embedded in the everyday workings of the organization and not just remain as mission statements. With right execution purpose-driven organizations exhibit better long-term performance metrics. Companies like Google have translated purpose into results by having deliberate systems and processes.

OKRs are one such goal-setting system which makes purpose operational through the core principles of focus, align, track and stretch. What defines purpose-driven leadership is not intent, but the systems that translate it into actions and impact.

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