Many entrepreneurs and leaders focus on creating a business model that can deliver value to customers and generate profits. But they often overlook a crucial question: Why does their business matter? What is the larger purpose behind their products or services? How do they make a positive difference in the world?
Panera Bread's Investor Activism PushBack
Ron Shaich, the co-founder and retiring CEO of Panera Bread, talks about his successful journey of transforming the company six times and delivering a 9400% return over 20 years. He also criticizes the short-termism and activism that plague the public markets and hinder innovation and long-term growth. He advocates for a more sustainable and responsible way of doing business:
How to Build a Mission-Driven Business?
A meaningful mission is not just a nice-to-have or a marketing gimmick. It is a vital component of a successful business model. A mission-driven business can:
- Attract and retain loyal customers who share your values and vision. Customers are more likely to choose your brand over competitors if they feel a connection with your mission and see how you are making an impact.
- Motivate and inspire your employees to perform at their best. Employees are more engaged and productive when they believe in their organization’s mission and see how their work contributes to it.
- Appeal to investors who are looking for long-term growth and sustainability. Investors are increasingly interested in the social and environmental impact and financial returns of their investments. A mission-driven business can demonstrate its potential to create value for all stakeholders, not just shareholders.
But how do you find your mission and embed it in your business model? The answer is simple: Listen to your customers. Understand their needs, desires, and aspirations. Find out what matters to them and how you can help them achieve their goals. Use empathy and imagination to create solutions that can improve their lives and the world.
Transforming a Low-Margin French Bakery
That’s what Ron Shaich, the founder and former CEO of Panera Bread, did. He transformed a low-margin French bakery into a profitable French bakery café by listening to customers and pinpointing the meaning behind the business model. He realized that customers wanted more than just bread. They wanted a place where they could enjoy fresh, wholesome, and affordable food in a comfortable and inviting atmosphere. They wanted a place where they could connect with others and feel a sense of community. They wanted a place where they could trust the quality and integrity of the ingredients and the people who prepared them. They wanted a place where they could make a difference by supporting social causes and initiatives.
Shaich built his business model around these customer insights and created a mission to serve “food as it should be”. He aligned his operations, culture, and strategy with this mission and created a loyal fan base, a motivated workforce, and a profitable enterprise. He also launched innovative programs such as Panera Cares, which offered meals on a pay-what-you-can basis to help fight hunger, and Panera 2.0, which leveraged technology to enhance customer experience and convenience.
Shaich created a successful and meaningful business model by finding and following his mission. He showed that a business can be both profitable and purposeful and that a business model can be both a source of competitive advantage and a force for good.
Looking to create a meaningful mission? Here’s a great way to start!