Take the foundation of focus on Purpose and People and thrive through the pandemic. Profits will follow as an outcome, rather than the primary driver.
As the model above (and the linked article) shows, I believe in the power of Purpose as the primary driver for a corporation. I truly believe that this model is critical to the corporations and the leadership (see # OpenLeadership article) we need for the future. However, this is a new thought, given that the Profit driver is uppermost and has been for fifty years and more. As a result, when I raise this concept, I often hear back: “well, CEOs only care about Profit”. I am therefore always on the lookout for live examples of companies that DO follow the model.
Covid profits plunge is a ‘badge of honour’ says Morrisons CEO
Headline from The Grocer, 11th March, 2021
Quite a headline! Morrisons is one of the large national supermarket chains in the UK and they stepped up in the highly uncertain times of the early months of the pandemic.
From the article, and read for yourself the focus on Purpose and People:
Despite the supermarket reporting an 8.6% year-on-year increase in sales in its full-year results today, profits before tax were down 62.1%, with Morrisons hit by £290m of Covid-related costs and almost £40m to restructure its online business to five times its pre-lockdown capacity.
However, Potts said his bigger concern was that Morrisons staff had stood up to be counted as the retailer went into a “war footing” to feed the nation during the pandemic.
“I wear the halving of profits as a badge of honour,” Potts said.
“The British people have had access to food because supermarket workers – and not just those at Morrisons – were required to become key workers.
“We were asking everyday ordinary people to go to work every day against a virus nobody understood. Frankly we could have made no profit and it would have been a result.”
Morrisons said profit before tax and exceptionals would have been up 5.6% to £431m before the repayment of £230m of waived government business rates relief.
I also included that last line intentionally as another indicator of the type of leadership we need. The UK Government provided massive support to business in the pandemic. Morrisons returned £230m of that relief. To me that is simple, they were doing the right thing. Morrisons, a £17bn revenue company, also paid a 6% “Thank You” bonus to all staff last year, on average triple of last year.
I project that Morrisons will take this foundation of focus on Purpose and People and thrive through, from and beyond the pandemic. As with the model above, profits will follow as an outcome of this, rather than the primary driver.
Kudos to Morrisons, and thank you for setting an example of #OpenLeadership
PS to Morrisons. Please shine a light on yourselves beyond the trade press (The Grocer). I find a lot of Purpose-led businesses shy of broadcasting that to the world, yet I feel it is time to not only lead by example but also to share and show that it works.