Industries create scarcity, purpose creates abundance

Autor: Francisco Palao (Purpose Alliance founder & Purpose Launchpad Master Trainer)

We are living an inflection point in humanity. Increasingly, people and organizations are more purpose-driven, which is transforming the world we live in. In this post I describe the evolution of organizations and how purpose-driven ecosystems connect communities with abundance to create massive impact.

The power of purpose

We all are here to create something that did not exist before we were born.

Both individuals and organizations need to give meaning to their existence. We need to do things that make us feel alive, that make us believe in what we do, that make us feel that what we do makes sense.

As Simon Sinek recently said in an interview, “The purpose of a car is not to buy gas. The Purpose of a company is not to make money. The purpose of a car is to go to somewhere. And the purpose of a company is to accomplish something, to advance a greater cause to contribute to society“.

Elon Musk also referred to the importance of purpose in his famous quote: “Life can’t just be about solving one miserable problem after another. There has to be a reason that when you wake up in the morning you look forward to being alive“.

My personal purpose is "to evolve humanity" and, since purpose is such a relevant topic for all of us, that's the reason why I decided to write the book Massive Transformative Purpose with Ángel María Herrera, where we open the MTP Canvas tool to the community in order to make it easier for people and organizations to find their purpose and give meaning to their existence.

We are living an inflection point in humanity. Increasingly, people and organizations are more purpose-driven, which is transforming the world we live in.

Purpose-oriented ecosystems

Traditional companies operate under a scarcity-based business model, offering a scarce service or product, in a market that sooner or later becomes a red ocean where competition generates a war of margins that ends up consuming the industry.

A few years ago, a different type of organization began to emerge: organizations connected to abundance, whose business models take advantage of this new environment. For example, energy companies and, more specifically, companies that produce solar panels, since they connect with the source of abundance of primary energy (the sun) and offer products based on this source of abundance.

Some organizations have a desire to have a global reach, and this is where the Exponential Organization arises, connecting with abundance and managing it in a way that scales exponentially. For example, AirBnB that connects with an abundance of accommodations and today is already the largest lodging chain in the world (without even owning a single hotel).

But there are organizations that have gone beyond exponential growth in a given industry. There are organizations that have understood that the concept of industry creates scarcity and that it is already obsolete. What industry does Google belong to? What industry does Apple belong to? None, and many at the same time. These organizations have become purpose-oriented ecosystems.

In the past, Apple was a company focused on the computer industry. And that's what they did, they sold computers to their customers. Now, Apple has transformed into an ecosystem focused on a purpose: "Empower creative exploration and self-expression." And around their purpose they have created a series of products, services and companies that offer value to their users. Apple continues to offer computers, but also phones, watches, applications, music, online content, and much more. Apple has become a purpose-centric ecosystem, and not a particular industry.

Purpose-driven ecosystems attract communities of people aligned with their purpose, who are no longer customers of an industry-focused company, to become users of the various services that the ecosystem offers.

The most important elements of this type of business model based on an ecosystem are:

  • The purpose, which is the reason for the ecosystem and everything that happens within it. Purpose is at the center of the ecosystem, and it shapes everything else with the goal of massive impact.

  • The community, which are those people and organizations aligned with the purpose and help in one way or another to make it come true. The community is the membrane of the ecosystem, and the larger it is, the greater its impact.

  • The value, which is generated by a set of organizations, products and services that the ecosystem offers to users, to facilitate the world in general and the members of the community in particular to make the real purpose.

When we understand this new paradigm, we can understand many of the things that are happening in the world today. This is the main reason why Tesla has a market capitalization greater than the sum of all of its ‘competitors’ in the auto industry. Because Tesla is not a company focused on the automotive market, Tesla is an ecosystem with a very clear purpose: "to accelerate the world's transition to sustainable energy."

Comparing Tesla cars with other car brands (BMW, Audi, etc.) is like comparing BlackBerry to iPhone. While BlackBerry was focused on trying to improve its product, Apple created an ecosystem that included much more than just a phone. And this is what Tesla is doing now: launching a series of products, services and organizations around its purpose, for a growing community of users linked to this purpose. Tesla is not a car company, it's a purpose-driven ecosystem.

Creating an impact, all together!

One of the most relevant effects that purpose-oriented ecosystems bring is that community members have much more power than before. In fact, when we find two ecosystems with similar purposes, direct competition disappears thanks to the interaction that is generated at the community level.

The competition generated by scarcity-based markets is a thing of the past. Community members who live their purpose in a real way collaborate and belong to different communities at the same time. Purpose-oriented ecosystem community members use different products and services from different ecosystems, putting what really matters at the center: purpose.

Let's look at another example, now with the ecosystem that Google has generated, whose purpose is "to organize the world's information and make it universally accessible and useful".

Google has created a series of products, services and organizations around this purpose that has attracted a global community of millions of people. And it is these people, it is the community, that has the power and they use these products and services in combination with those of other similar ecosystems oriented to a purpose aligned with Google.

Google Search users search Wikipedia (whose purpose is “to benefit readers by acting as a free widely accessible encyclopedia”) or TED (whose purpose is “ideas worth spreading”), and Google offers this information at its search results. Google Docs users also use Microsoft Word, Excel, etc. products. (and others like it) when organizing information in different types of documents. Google Calendar users organize the information in their calendars by combining the functionality of other similar applications such as Windows Calendar, Apple Calendar, etc.

In short, the purpose of Google is being fulfilled thanks to the ecosystem that has been created around its purpose, and that includes elements and external organizations that are oriented to a similar purpose and complement the value for the community. And most importantly, community members belong to multiple ecosystems at the same time, making use of the value that each these ecosystems offer for them to create an impact aligned with the essence of the combination of all these ecosystem's purposes, which remains in the center of everything, as can be seen in the above image.

Communities are made up of people, and people are in these communities because of the power of purpose and the positive impact (including a sense of responsibility) that it can bring to the world.

The power of people and their purpose is making different ecosystems with similar purposes to collaborate without even needing a formal collaboration agreement among their leaders. The power of purpose is driving new concepts, new ways of doing things, new models and bottom-up approaches that are creating a better world.

Something similar is happening at Purpose Alliance thanks to our purpose-oriented ecosystem approach (“empowering extraordinary people to create the future”), which is generating interaction with members of different communities using the different elements of our ecosystem (Purpose Launchpad, Purpose Evolver, Purpose Services, etc.) to make their purposes (that are aligned with ours) come true.

Some of these people come from communities such as Singularity University, (which purpose is "educate, empower, and inspire leaders to leverage exponential technologies to solve humanity's grand challenges"), where I belong as alumni and also had the opportunity to create the first startup acceleration process. Another good example is OpenExO (“transforming the world for a better future”), a community to where I also belong and where I also made a contribution designing the ExO Sprint and writing the book ‘Exponential Transformation’.

We shouldn't forget other relevant purpose-driven communities such as Abundance 360 ​​(“understanding and leveraging exponential technologies to transform their businesses”), Ashoka (“to shape a global, entrepreneurial, competitive citizen sector: one that allows social entrepreneurs to thrive and enables the world's citizens to think and act as changemakers") or Women4Ipmact ("unlocking women’s full potential for a better world").

All these communities are very aligned in purpose with Purpose Alliance community and, in fact, there are many people who belong to more than one of these communities at the same time, since what moves them is not a specific industry, but a purpose.

Actually, I encourage all people who feel aligned with any of these purposes to join all these communities and combine them in the best possible way so we will be able to achieve the purpose that we all share. Similar purposes can have different ways of being expressed, but the essence is shared.

The most important objective shouldn't be to become the market leader, but to contribute to achieve the purpose.

If the purpose is fulfilled, all entities that share it will succeed.

If the purpose is fulfilled, all the entities that share it will have more opportunities.

If the purpose is fulfilled, the world will become a better place to live. And who doesn't want this to happen?

Let's create a massive impact, all together!

Francisco Palao

Purpose Alliance Founder

Recent Posts

See All