Share

The power of purpose

Conscious Capitalism, by John Mackey and Raj Sisodia

THE basis of Conscious Capitalism is the moral and economic superiority of Conscious Capitalism over all other economic theories.

It has proven to grow companies and countries faster than all competing ideas, while at the same time raising the happiness quotient of its beneficiaries.

The focus of last week’s column was the theoretical base: this column looks at the practicalities of making Conscious Capitalism a reality in your business.

There are four principles that underpin the practice of Conscious Capitalism: higher purpose and core values; stakeholder integration; conscious culture and management; and conscious leadership. I am going to focus on the first two.

Author Richard Leider asks every audience he addresses the following question: what are the two most important days in your life?

Most people, he reports, identify the day they were born and an event such as their wedding day. The answer Leider wants them to get to is obviously the day they were born, but less obviously the day they realise why they were born.

(Pause here and think about this.)

Consider how different your working life would be when it dawns on you that you were born to ensure fairness in business, which is why you are a commercial litigator.

You were born to make people’s movement about their cities and country safer and smoother. That is why you are so committed to your work in the Integrated Traffic Systems department of the local roads authority.

When the employees of your company, department or unit, see their work as infused with meaning, you will see a commitment rarely seen elsewhere.

Executives of Medtronics, the world’s largest medical technology company, regularly tell staff: “Your job here is not just to make money for the company; your job is to restore people to full life and health.”

To drive this point home, six patients are brought to every year-end party to describe how a Medtronic defibrillator, or a stent, or a spinal surgery with a stimulator has changed their lives.

The Container Store, a hugely successful multinational chain of stores selling containers, practices Conscious Capitalism. Their purpose is to “help people get organized so that they can lead happier lives”.

The co-founder and CEO encourages his sales staff to do everything they can to sell customers products that they might not be aware they need.

He repeats his" lost man in the desert story” at every opportunity. Imagine a man lost for days in the desert, dehydrated, terrified and almost delusional with thirst. He sees you and desperately asks for water.

Most people would feel good that they have helped the man by giving him a flask of fresh water. That is all the thirsty man asks for and wants at that moment.

However, there is so much more one can do for him. “He probably has heat exhaustion or sunstroke; he obviously needs a hat and sunscreen; he needs to be re-hydrated. You could call his wife and family and let them know he’s okay, since he’s been missing for days.”

A salesperson whose only focus is to meet target behaves very differently from a salesman with a higher purpose. Up-, on- and cross-selling containers is not a way to extract more sales, but a way to get the customer more organised so he can lead a happier life.

Purpose-driven salespeople outperform the target driven type across all product groups.

I have emphasised this principle of higher purpose because in my experience with a wide variety of companies in 14 countries, it is the one that seems to get lost over time.

Often, the founders of the firm were driven by a higher purpose, but without constant reminders in a wide variety of ways (bringing patients to the party or telling stories) their initial purpose fades or is ambushed by slumps or the race to meet payroll.

It is well worth revisiting the issue of your business’ higher purpose, if for no other reason than its economic value.

“Stakeholder integration”, another Conscious Capitalism principle, is a philosophical issue with profound practical consequences.

The stakeholders in any business are the shareholders, the staff, suppliers, the customers or clients, and the community in which the business operates. The common view of stakeholder groups is as a zero-sum game.

There is only so much to go around and if staff get increases or suppliers are paid on time, and if contributions are made to the community, someone must get less.

The “Conscious” part of the book’s title Conscious Capitalism refers to a wider and deeper understanding of how the world really works. People who are not highly conscious think narrowly and in short timeframes. They do not see the whole picture and they do not see consequences.

When stakeholders are seen as an integrated whole, and this collective is not viewed in terms of a zero-sum game, we know we have to think win-win, and be highly creative.

If staff feel underpaid they will be disgruntled, so they may work with less enthusiasm. This leads to lower profits of shareholders, and less satisfied customers. Businesses run on Conscious Capitalism principles outperform businesses based on other economic models.

The business is not mechanical; it is organic. Every part affects every other part, because each part is connected and interdependent.

There is much food for thought in this wise book. It deserves a slow read.

Readability:   Light ---+- Serious
Insights:        High +---- Low
Practical:       High --+-- Low

 - Fin24

* Ian Mann of Gateways consults internationally on leadership and strategy. Views expressed are his own.
 
 

We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.88
+0.3%
Rand - Pound
23.86
+0.2%
Rand - Euro
20.39
+0.2%
Rand - Aus dollar
12.33
+0.1%
Rand - Yen
0.12
+0.2%
Platinum
908.05
0.0%
Palladium
1,014.94
0.0%
Gold
2,232.75
-0.0%
Silver
24.95
-0.1%
Brent-ruolie
87.00
+1.8%
Top 40
68,346
0.0%
All Share
74,536
0.0%
Resource 10
57,251
0.0%
Industrial 25
103,936
0.0%
Financial 15
16,502
0.0%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders