Who cares about Purpose in a business?
The Idea in Short:
71 percent of American workers are not engaged or actively disengaged from their job, worldwide 13% of workers are engaged shows a Gallup survey published in 2013. Research proves happiness raises sales by 37 percent, productivity by 31 percent and accuracy on tasks by 19 percent. Yet businesses often ignore all of that. Science proved that behind Happiness there is a state, called Flow. Flow is demarcated by simple things like, clear goals; direct and immediate feedback; balance between ability level and challenge; a sense of personal control over the situation and an intrinsically rewarding activity. I propose to connect the dots and run your business with giving ample attention to the above success factors. I also suggest that to make something intrinsically rewarding you need a Purpose. Companies with a Purpose do extremely well and foster a culture of passion, sense of community and happiness. As a Leader You need to start finding a Purpose in your life and build/find a business that is in alignment with your own Purpose, if you want to live your life to its full potential.
Consider the following: 71 percent of American workers are not engaged or actively disengaged from their job, worldwide 13 % of workers are engaged show a Gallup survey published in 2013. On the other hand we also know that research proves happiness raises sales by 37 percent, productivity by 31 percent and accuracy on tasks by 19 percent based on Shawn Achor’s research widely publicized on CNN, TED, HBR.
I have recently worked with an extremely successful wholesale business. It is a medium size highly profitable company and it has been growing for at least 5-6 consecutive years at a rate of minimum 10-15%. They are the absolute market leader in their sector. Interestingly, the company is not well run in the sense that it fails on almost all of the points above. Their processes are often unclear. They don’t really have a system of performance appraisal in place. Their recruitment is based on very subjective criteria. The management is still very centralized and held strongly by one of the owners. The one thing that struck me about them was that they all seem to share a passion for what they do and I have never seen a bunch of more enthusiastic and motivated people. This seemed as probably the biggest contributor to their sustainable financial success (the other factor was is they started at the right time, anticipating an opening market which they basically built out as they grew).
It seems that there is a clear link between engagement/happiness/business results. We even have hard evidence like a Tower Watson study that found through global workforce studies, that you can correlate high engagement with better financial metrics. For example, in a three-year study of 41 global companies, they found that operating margins improved nearly 4% on average in organizations with high employee engagement levels. Despite all that, the problem in the business word is that terms like happiness, engagement and living to one’s full potential sound all too vague, wishy-washy and intangible for most leaders.
I think we just haven’t connected the dots. Research shows a clear link between engagement and happiness and what we otherwise know as effective management. In another widely recognized and groundbreaking research project Mihaly Csikszentmihalyi a world famous Hungarian psychologist has identified the state of Flow. His research goal was to understand what causes happiness, what characterizes it as a mental state, and how do people get into it. He found that people consider themselves happy when they enter into a state of Flow.
He was able to identify ten core components that demarcate the state of Flow:
- Clear goals – expectations and rules are very clear and align with the performer’s skill set and abilities and at the same time the challenge level and skill level should both be high
- Concentration: high degree of concentration on a limited field
- Loss of the feeling of self-consciousness
- Distorted sense of time
- Direct and immediate feedback
- Balance between ability level and challenge
- Sense of personal control over the situation
- Intrinsically rewarding activity
- Lack of awareness of bodily needs
I believe all business owners; leaders and managers agree that if there is a way to put people into a Flow state, which can increase engagement and happiness and ultimately bring more profit, it is something to be done.
Therefore, making a link between the above Flow criteria and people management I propose no business should be run without:
- Creating very clear standards of „ what good looks like” and what the goals and expectations are
- Hiring people based on a very clear understanding of what the process (that they will have to do) should look like. This will define what skills and competencies will be needed and not vice versa – so as to try to match candidates to some golden plate competency matrix that was created far-away from the business in the hands of „experts”
- Creating a clear best practice and expectation about how often Feedback is given and in what way
- Measuring people on what they have some influence on, or at least show them very clearly how they can contribute to organizational level results and KPIs
- Making and effort to transform all activities to intrinsically rewarding – and guess what, the almost only way for this is to define a motivating vision and purpose for the organization/division/department/individual and to show how the activity will lead to that desired state.
- Identify the Purpose for the business – a clear link to intrinsic motivation
In terms of priorities for the above, they are all highly necessary. The one difference that makes the biggest difference is clearly Purpose. If we come back to the example of the extremely successful wholesale business, this is where they were very strong. All the people they hired shared a passion for what they sold – for example’s sake let’s call it organic tomato juice. They had a very close relationship with the growers and consider themselves as part of a larger community therefore contributing to making something better. It is no wonder that their people are generally very positive and enthusiastic about what they do. If they were willing to advance on the rest of the above demarcation points I believe they would become even more successful.
It is simple. If you have a Purpose in your life, you now, why you get up in the morning. You know, why you go to work and why you want to do your best. It is not easy, but it all makes sense. If you know your Purpose, it will be easier to find the right level of challenge for yourself and chances are that you can get into a state of FLOW on a daily basis. If your Purpose matches the Purpose of the business you work for – you are bound to be more motivated and going the extra mile.
It seems that Meaning or Purpose is even more important then happiness. One can find meaning in life and be unhappy at the same time as Jennifer Aaker of the Stanford happiness research project points out. This type of life gets much less buzz in the media. However, while sometimes unhappy in the moment, these people – connected to a larger sense of purpose and value – make positive contributions to society.
So, have you asked yourself what your Purpose is?
What are you doing everyday to get there?
What is the purpose of your business or the company you work for?
Can you align with that purpose?
I promise you that if you just only spend 5 minutes every morning in quiet contemplation about your Purpose, and then mentally and literarily thank at least one person who is around you and helping you to get there, you are already one big step ahead. You will also find that certain decisions will come easier which will ultimately lead you to more success and satisfaction in a more profound and deep way. As psychologist William James concluded: „Most people live a very restricted circle of their potential being. They make use of very small portion of their possible consciousness and of their souls’ resources in general, much like a man who, out of the his whole organism, should get into a habit of using and moving only his little finger.”
The choice is yours; you can move your whole body for a greater Purpose if you want!