The Power of Purpose: How Patagonia Walks the Talk
We find ourselves at 6.30 am on a Californian beach. In the ocean in front of us we spot dolphins playing in the ocean while the sun slowly rises in the background. We are here to discover more about outdoor clothing & gear company Patagonia and are waiting for our first meeting of the day.
Soon after, our host of the day, Chipper Bro, arrives in his van loaded with surfing gear. The first meeting of the day turns out to be a surfing session with Chipper, who happens to be 12 time world freestyle frisbee champion. This is by far the most unique introduction to a company we experienced so far. At the same time it is very much aligned with the philosophy of Yvon Chouinard, Patagonia's iconic founder. The title of his autobiography says it all: 'Let my people go surfing'.
After catching some waves (let's rephrase that: after smashing head-first into the ground numerous times) we head over to Patagonia’s headquarters in downtown Ventura. There are around 600 people working here, of which most of them are outdoor fanatics ranging from surfers and snowboarders to mountain climbers and fly fishers. As you can imagine, the atmosphere is extremely friendly and chill (or rad, as Chipper taught us). We take a seat in the Californian sun and over the next hours we get the chance to meet plenty of employees. They sit down with us and share their personal stories.
Soon we notice that at Patagonia everything seems to evolve around their purpose and mission statement. They defined it in 2012 as follows: Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis. As one of the employees mentions: “We want to set the best practices other people want to follow. We want to show other businesses how to do good. But in the end, we just want to do the right thing.” All the people we spoke to seem to be committed to make a significant dent in the universe. But which conditions did Patagonia shape to facilitate their employees to make a mark on the world? And how are they actually walking the talk?
It's all about authenticity
During our worldwide search we get to know lots of different organizations. From the pioneers on our Bucket List to companies that are in (desperate) need of improvement. One of the buzzwords seems to be purpose. Everyone talks about it, but only few are actually walking the talk. Often, purpose becomes a meaningless phrase that nobody in the company can recite. And when important business decisions need to be made, the purpose mostly is of minor influence to the outcomes.
At Patagonia, we experienced the opposite. All everyone are doing is in service of their purpose. Whether it is the guy working on social media, the product experts, the women from the laboratory, or the human resource employees, everyone is consciously contributing to Patagonia's mission. This is something we hadn't experienced on such a level before. There's no shortcuts to doing this, it's all about authenticity here.
In fact, it seems that at Patagonia they are already walking the talk for decades, and mostly due to radical initiatives and leadership involvement. While we are sitting outside interviewing people, there are constantly kids playing in the playground behind us. That's because Patagonia started 33 years ago with building the best on-site child care possible. Nowadays they have an on-site child care center run by bilingual teachers who are all trained in child development. The kids are encouraged to spend as much time as possible outside discovering new things. While we interview employees, we regularly see parents walk in to connect with their kids.
The on-site child care was not born as a perk to attract new employees but rather as a solution to a problem in Patagonia's early days. Yvon Chouinard and his wife Malinda started Patagonia with friends and family and they wanted to support them in starting their own families. They responded by establishing the things their employees needed most, which was a place to nurse newborns at that time. Later this turned into a safe and stimulating on-site child care. The on-site child care is not only convenient for Patagonia's employees but it also benefits the company immensely. An employee explains; "At Patagonia 100% of woman return to work after having children, compared to a 79% average nationwide. It leaves us with the ability and capacity to establish gender equality. About half of our managers and senior leaders are woman, which is great for diversity."
Dumping the most profitable product line
At Patagonia they strongly value transparency and equality in order to make balanced decisions that are not only favorable for themselves but also for the planet. It led them to start looking critically into their own supply chain in order to reduce the environmental harm their products were causing. This all was kick-started in 1994 when organic agricultural activist Will Allen took some people of Patagonia on a tour around cotton farms in California. He showed the people of Patagonia first-hand that the growing of conventional cotton involves heavy use of chemicals that poison the soil, air and groundwater. Ultimately this led Patagonia to replace all of its conventional cotton by 100% organic cotton.
Problem was that, at the time, clothing made from conventional cotton was responsible for 20% of the Patagonia's total business. The alternative, organically grown cotton, was only a very small part of the cotton that was grown around the world. Patagonia needed to develop their materials from scratch. Sales of about $20 million were at stake, but still they continued with their decision. They got everyone in the company on board by explaining their decision in a very transparent manner as one employee explains: "The company arranged bus tours to cotton fields so we saw for ourselves the harm conventional cotton and its pesticides were causing to the environment. This was part of our organic cotton program where we also saw the benefits of organic farming. Hundreds of us went on the tour and many of us have since shifted to buying organic food and clothing."
Put your money where your mouth is
It's not only the historic actions that count at Patagonia. A more recent campaign caught worldwide attention during our visit. The campaign, Vote Our Planet, was urging Americans to vote "to protect our air, water and soil". It was designed to provide voters with the resources that will empower them to take action in their support for a healthy planet. The company committed an estimated $1 million to the campaign in order to stimulate voters to back candidates in their regions who advocate for clean water, clean air and renewable energy. Additionally, during election day Patagonia closed its headquarters, retail stores, and distribution centers hoping to encourage both their 2000 employees and their large customer base to vote.
This month Patagonia made global headlines again by announcing to donate its entire Black Friday sales directly to environmental organisations around the globe. It turned out to be a big success. CEO Rose Marcario reported a record breaking $10 million in sales, about five times higher than expected. It enables Patagonia to walk the talk and support "hundreds of grassroots nonprofits fighting to protect our air, water and soil for future generations".
Sense of belonging
The visit to Patagonia's headquarters and the plenitude of talks surprised us. We witnessed the power of purpose before, but this level of authenticity, passion and personal connection with an organizational purpose was unlike we experienced before. The interesting thing is that at Patagonia no progressive organizational structure seems to be needed to create a highly engaged workforce. The importance and belief in working to realize their purpose is so important to them, that all other aspects seem secondary.
It was a great experience to feel the cohesion and sense of belonging at Patagonia. There's a true belief in achieving something bigger than yourself while at the same time, and let's not kid each other here, being a successful for-profit organization. It's something the vast majority of organizations can learn tremendous amounts from. But be careful, it only works with true authenticity. It's all about feeling it and consistently walking the talk.
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In a previous post on Haier's RenDanHeYi forum in Shanghai we shared which speakers we were looking forward to, hoping they would provide “Management Fireworks”. Last year we were hosting the forum, but this year we could sit back and listen. Now it’s time to share with you. So, strap in and enjoy!