Some phrases became recurring throughout the more than one hundred mentoring sessions I conducted with leaders of Portuguese SMEs, within the scope of the VOICE Leadership program at Nova SBE Executive Education: “I feel confused”, “I can’t handle it”, “I don’t know where to start”. For the most part, these leaders are founders or members of the founding families. Behind these phrases, I find companies that have grown, conquered the market, and accumulated experience.
Along the way, they seem to have drifted away from what gave rise to them.
These leaders face a Portugal increasingly exposed to competition. They seek new ways to grow, but to move forward, they need to define priorities: deciding where to concentrate their resources and which opportunities they should, or should not, pursue. There is anxiety and fatigue in the air. They are bogged down in routine, too involved in operations, and often convinced that no one knows how to do what they are doing.
All decisions go through them, leaving them no time to think, much less to make the fundamental choices.
It's a risk: as the business grows and operations become more complex, the leader can become detached from precisely what they should be fiercely protecting. They cease to fulfill one of their fundamental roles: being the guardian of the company's purpose. Between the pressure for survival and the multiplying demands, it's easy to lose direction amidst so many "must-haves": digital transformation, talent retention, sustainability, among others.
Purpose seems to be swallowed up by daily life.
Sometimes, the memory of that initial impulse reappears. It shines for a moment, but fades again because the leader considers it impractical, too subjective, or even naive. After all, "one must adapt to the market."
Some of these SMEs have a defined mission, vision, and values ​​published on their website. The problem is that, often, these are just words. They don't guide choices or produce a concrete impact on management. And it is precisely a strong and applicable purpose that can help leaders make clearer decisions. In my work with SMEs, I have noticed that activating purpose can function as a guiding criterion and as the basis for differentiation capable of translating into a true competitive advantage. This intuition is echoed in recent research, notably in the study " Turning the Tables: Leveraging Purpose as a Strategic Advantage for SMEs ," by Klaus Heine, Glyn Atwal, and Sonja Sperber (2026).
From my more than twenty years in the luxury industry, I've developed an almost obsessive focus on the essence of brands. In the major fashion houses with which I've had closer contact, this identity is deeply linked to the purpose of their founders: their unique vision, their principles, and the value they intended to create. And a large part of the role of a luxury brand manager consists of protecting and cultivating this legacy. It is this essence that fuels desirability and guides all decisions, from innovation to the exceptional consumer experience. At the LVMH group, I learned that desirability isn't built simply by charging more or giving less. It's built with discipline and consistency, protecting what makes each brand distinctive.
A strong brand knows who you are, where you want to go, and, most importantly, where you don't want to go.
An SME may not aspire to become a luxury brand. However, it can leverage the discipline of building value from its uniqueness. During a mentoring session, a leader asked me if branding would be relevant for a small company selling white label products. Even in that case, it matters: it conveys a story, a particular way of doing things, and a value proposition. This identity influences the choice of partners and helps the SME define what it can compromise on and what it cannot: its non-negotiables.
SMEs have an extraordinary advantage: their essence is still alive within the company.
The founder's spirit is present, the history is known, and the values ​​that gave rise to the business can be more easily recovered. There's no need to invent a narrative. It's necessary to reclaim it.
When it's clear, the purpose serves as a reference point at crossroads: Does this investment make sense for us? Does this new line reinforce or dilute our positioning? Does this channel bring us closer to the customer we want? Does this partnership increase or decrease our perceived value?
The true usefulness of purpose lies not in what it allows the company to say, but in what it helps it decide. It doesn't eliminate uncertainty or limit possibilities: it offers a criterion for choosing between them.
When resources are limited, making the right choices is even more crucial. Perhaps a well-articulated purpose is, therefore, one of the most accessible management tools for SMEs: a compass to decide, assert their difference, and grow without diluting what justified their existence. It's not a conceptual luxury.
May SMEs afford to know where they're going!
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