We hear a lot about “purposeful” and “purpose-driven” leaders and organizations. But what does that really mean, and does it make a difference?

According to Mark Hannum, senior vice president of research and development at Linkage, purposeful leadership is “identifying a personal ‘why’ and then successfully translating that into an organizational ‘what for’ – a broader vision and messaging that teams can rally around, that affects real change.” Tom Rose, head of global innovation and client solutions at AchieveForum, defines purposeful leaders as those who can identify their purpose and link their work to that purpose – and help others do the same.

Last month, Linkage, Inc. announced a new purposeful leadership model based on a study using the firm’s 30 years of consulting work. Matt Norquist, president and CEO of Linkage, is quoted in the press release as saying that the model is a “practical roadmap to developing and advancing diverse leaders who accelerate change and innovation, and drive growth and employee engagement.”

This research found correlations between a leader’s effectiveness and how well they inspire others to work toward a common vision, engage every employee in “meaningful activities,” contribute to innovative products or processes, “achieve significant results by organizing people,” and become self-aware in how well they coach and influence others.

Commitments, Not Competencies

Rather than creating a leadership model made up of competencies, Linkage researchers believed that a purposeful leadership model should be made up of commitments, supported by daily practices and behaviors. They identified five commitments purposeful leaders make:

  1. To inspire hope among team members in the leader’s vision
  2. To engage team members “to bring their full and best selves” to work
  3. To innovate
  4. To achieve – to put a plan in place and follow through on it
  5. To become self-aware and willing to continually grow, realizing that this process is never complete

Norquist says quantitatively, purposeful leaders are defined as those who demonstrate these commitments in the top quartile of all leaders – better than 75 percent. Both Hannum and Rose also point to the importance of courage in identifying and declaring a purpose.

Developing and Measuring Purposeful Leadership

Hannum says that most organizations don’t know if they have purposeful leaders, so it’s important to have methods in place to figure that out. Use 360-degree or other employee surveys and assessments as well as working together with organizational leaders to determine, according to Norquist, “the degree to which the organization demonstrates certain behaviors, characteristics and commitments and to what degree of maturity.” Rose adds that the topic can also be explored in employee focus groups.

“Most people struggle to define their sense of purpose, and most organizations do, as well,” says Rose. That’s why it’s critical for organizations to set aside time and support to help leaders identify their individual purpose and understand the organizational purpose.

Norquist recommends using a combination of classroom instruction, coaching and experiential learning to develop purposeful leaders. In the classroom, Rose says it’s helpful to provide examples of organizations and people who are driven by purpose both to show them how to do it and to demonstrate “that this really works.” Experientially, Hannum adds, “it’s about putting the right combination of factors together” so leaders put in roles where they must create a vision, inspire others to contribute to the vision, innovate and “create a presence.”

Impacting Business Results

Purposeful leadership isn’t just a feel-good nice-to-have. “When people have a big-picture view of the benefits you’re trying to create for them or the difference you’re trying to make in their lives,” Rose says, then they “have the north star of what it is you as a company are trying to achieve.” It increases their job satisfaction as well as their commitment and in turn drives customer retention and loyalty, performance, and business results.

Linkage’s research found connections between purposeful leaders and business results: The companies they led had 2.5 times higher sales growth, four times higher profit growth, five times higher “competitive differentiation and innovation” scores, and nine times higher employee engagement scores.

“In the day-to-day pressure of getting work done,” says Rose, “we often lose sight of” that northern star – the purpose that should guide the organization and its employees. By developing a strategy and setting aside time to develop purposeful leaders, organizations can reap great benefits.