The Human Solution - Sneak Preview, Chapter One
Chapter One | Once Upon A Train
Business transformation has been talked about for some time now, but never effected on a large scale. It was too difficult to see what could be done differently, and we have not had the understanding that it was our perspectives that needed to change. To make things worse, if someone did now and again see what could be done - and dare to mention an idea that smashed the system open in order to create the success of a vision - they were quashed and punished for the effrontery to challenge The Way Things Are. Some pioneers have been working for decades to transform business through living systems.
Too few people know of these pioneers...yet. But we’re about to. And we have to become pioneers now, all of us.
The time to make a complete 180 has come down upon us like the proverbial freight train, and we can no longer hide behind “It’s too hard!” or “It can’t be done!” Bullshit. Of course it’s hard, and isn’t that why we need to put our human ingenuity in gear, and our creative thinking, and let go of the me-me-me and mine-mine-mine, and understand that it is all about “our”. And as to “it can’t be done” - that’s ridiculous and I would invite you to look at what we communicate with: computers, applications like Zoom and Skype. Let me assure you that just 50 or 60 years ago - just 50 or 60; the 1950’s and 1960’s! - people would have said, “Oh, there’s no way we could ever talk to one another and see each other’s faces! No way! There’s no way we could ever be like the Star Trek people with ‘communicators’ in our hands.”
It took the Coronavirus - it took a freaking planetary pandemic! - to reveal just how broken our business-as-usual system always was.
Now a new era of life is upon us. We hear the phrase “our new normal”. But what is that? Here we are, 150 years of post-Industrial Revolution under our belt with our adherence to top-down, power-over rules which have been punishing and demeaning to those below the power line, frustrating but financially rewarding to middle management, and cash-cow power-slinging opportunities to those at the top.
And that “normal” gave all of us drinking problems, resentments, heart attacks, negatively life-altering differences in pay. That “normal” made the same damn problems arise day after day for decade after decade: attrition, engagement, “personnel problems”, and the stress of having to come up with something new to try...unsuccessfully.
We have been missing something in our business-as-usual. And that something is big. Scratch that; it’s enormous. But the good news is that when we see it and craft our work, our systems, our attitudes to that “invisible” core aspect, every single thing is impacted for the better.
I mean everything. And everyone: Business, the people in business, customers, clients, communities, and our planet.That’s kinda big.
So, what is this big something and where is it hiding that we’ve been able to ignore it for 150 years?
It is something hidden behind false narratives about the miniscule place of the human being in life and specifically in business: that we are in service, and enslavement, to something bigger and more important than ourselves. That the human doing the work is the dismissable servant to the gods of money and progress. Replaceable. Responsible. But never authentic. Never generative. Never ever as important as the bottom line. And never ever as important as the person on the ladder rung above.
With the hierarchical mindset born of this idea, management and non-management alike can easily assume the so-called “rank and file” in any business structure to be less capable, less unique, and more easily replaced. Like a machine part.
As a result, answers are applied hierarchically; top-down. The usual business problems - attrition, lack of engagement, ineffective procedures, financial constraints - are approached only with known solutions: trainings, pulse surveys, assessments, redesigned departmental structures, financial cuts, new health insurance, free lunches, holiday parties. Shall we be honest? None of those solutions really leads to big wins. After the money, the time, the planning, we find that we still have the high attrition, the lack of employee engagement, and the high cost of having to effect trainings repeatedly in order to meet the new employees coming through the revolving door. We still have financial struggles and the daily disappointment and stress of never. quite. getting. there.
We never quite get to a satisfying sense of having accomplished something that moved the needle, solved the real problem, freed us to move on to something else…something new.
What is the problem?
The problem is a blindness to the importance of humanness - of life and its quality. Business has been steadfastly blind to where to find and how to use the greatest resource on planet earth: the human being.
This greatest of resources is us. The answer to all of our questions about business systems and business “problems” is right in front of us and hidden in plain sight: it is the minds, the creativity, the humanness, the experience, the contributions and the insight of our non-management colleagues. It is the human factors taken as our focus and core reason for being; even and especially in business.
In this time of paradigmatic shifts, we have to get excited about the positive shifts we want to make, and we have to be willing to court some seriously good results. Sounds like a good thing, right?
And yet we have resisted. We have met the well-known definition of insanity: “doing the same thing over and over again and expecting different results” by insanely trying the same solutions over and over and over again. There are human answers to these problems which we cannot see because we are blinded by data.
Attrition - “Let’s hire ‘better people’. Let’s try ‘better trainings’. But let’s not create an environment that actually keeps people around. That would be too expensive.”
Lack of engagement - “Let’s offer prizes! Let’s give them a day to put on a Christmas show for us! Let’s give them free soup at lunch! That’ll solve the lack of enthusiasm around here!”
Lack of trust - “They don’t trust us? Let’s be friends, then! Let’s have coffee get-togethers, ice-cream socials and Appreciation Days! ...What? You want vulnerability? You want us to consider your ideas? Okay, well we heard your ideas and your feedback, and it’s clear that you just don’t know what you’re talking about. Would you like some more coffee with your ice cream?”
The problem and solution are right in front of us
None of the solutions we worked with for so long are successful in moving the needles, creating vibrancy in our organizations nor building regenerative solutions without our willingness to see and address what is, as it is. The critical technical error we are making is akin to trying to build a house starting with the roof. The critical human error we are making is akin to trying to make a computer out of a human being.
The people at the so-called bottom receive the run-off of frustration which cascades down from the top. They are, as a group, steadfastly ignored, disrespected, and denied permission for self-empowerment or growth. There is blame, emotional abuse, power-slinging, gaslighting, unfair firings without recourse, infantilizing attitudes, deafness to input, punishment for daring to show strength or smarts or promise.
And after all of that, there is an unrealistic expectation from manager and corporate leaders alike that there “should be” enthusiasm, engagement, dedication, and above all cheerful obedience.
This simple, oxymoronic and illogical mindset culled from the top-down, better-than-you business structure has killed not just individual careers and spirits, but has also hidden billions if not trillions of dollars from the eyes and hands of those who have adhered to this setup for so very long.
The business part of this lack-of-humanity problem starts - and ends - with a structure and culture that lauds a fracturing, conquering philosophy. That problem arose in 1832, and it all began with a train wreck.
The Train Wreck That Gave Birth to an Org Chart
Our top-down organizational structure came into focus as the result of a train wreck in 1841 between two Western Railroad passenger trains. The accident killed a conductor and one passenger, and injured 17 others. What the wreck did was highlight the fact that the business owners, whose post-Industrial Revolution business had grown to three geographically disparate branches, felt they had too little control over the day-to-day workings of their railroad. They became aware that they could not account for nor predict problems, so an understandable desire arose on their part to: (1) not do everything possible to avoid such a situation in the future, (2) to hold someone accountable for the problems, and (3) to find someone responsible who could avoid such events.
“ ‘…. That disaster marked the beginning of a new management era.’] These words open Peter Scholtes’ classic book on leadership. He goes on to explain how the term "management" was unknown in the days of cottage industries. As business grew and became geographically disperse in the 1800's, a way to run these businesses had to be found. But there were no models outside the church and the military, so investigators into the train-wreck disaster looked to the Prussian army for a model. And there they found the classic organization chart - the one we know so well today. Scholtes calls it the "train-wreck" chart. It was revolutionary at the time.
The purpose of what became today's organization chart was clear: The assignment of responsibility would enable "prompt detection of derelictions of duty... and point out the delinquent." Scholtes says: "A fundamental premise of the 'train-wreck' approach to management is that the primary cause of problems is 'dereliction of duty'. The purpose of the organizational chart is to sufficiently specify those duties so that management can quickly assign blame, should another accident occur."
…Note the thinking here: Problems are caused by people who don't do their job well, so finding someone to blame is the first step to correcting problems. [bolding by the author]
The army solution is extremely impersonal. Positions and duties are defined, one person per position is then measured by how well they fill that position and carry out the duties assigned by the “superior” above. Moreover, every level reporting to the level above is judged without remedy.
Hence the advent of Human Resources. This department was going to fix the inhumanity problem and put someone in the corner of the employee who was not simultaneously taking a stand against the company. A very narrow line to straddle, admittedly.
Blaming someone else for a problem is hardly a new human tendency. However, with the org chart and the army solution now routinized in business, this tactic of find-the-problem-fix-the-problem became the practical focus – one that has not really changed since the 1800’s.
Unsurprisingly, an unchanged 1800’s solution is no longer as successfully applicable in the 2000’s. The top-down, hold-someone-responsible attitude has backed up on business in ways that the business community either does not see, or does see but does not believe that there is a solution to the problem. That blindness costs us everything from the vibrancy and excitement of a day-to-day transformational attitude, to the persistent glass ceiling that women - even entrepreneurial women - push against with limited success even now, and limiting and even reversing the bottom line.
An army-like approach operates under an assumption of unquestioning obedience from below, and unquestioned direction from above. In the world of business operating in a time of increasingly dehumanizing and computerized perspectives, the challenge and the need to break this mold and redefine the meaning and goals of business has never been greater.
The Army Structure: From the Top, Down, Do As You’re Told
A General and a Private walk into a bar…
No. They don’t. They are separated by rank and perceived importance and they do not drink in the same bar. The General carries the weight of the world on his shoulders and the Private carries the weight of his duties on his shoulders from following as well as he can the orders of the people above him.
Implied in the status of each of these individuals is that one is more important, wiser, and more valuable than the other.
But I beg to differ. While I clearly see the difference in the nature and responsibility of their positions, I also see what is being missed. I mean, have you seen the movie Forrest Gump? Forrest connects with everyone personally, and in the same way: honestly, directly, unflinchingly.
All of us - even the so-called “least” of us - have gifts, ideas, perspectives which when given the opportunity to meld with others’, hold the magic that transforms, rescues, and impacts the personal and business worlds of those around us. Suddenly, “work life” and “regular life” have a meaningful link.
Instead, we continue to hamstring ourselves with wrong thinking about leadership. Holding the assumption in place that the “General” must be intrinsically more important/wiser/more valuable than those below him, the General of Industry thinks that he must come up with all of the answers or appear weak, and he operates on the assumption that the people below him have little or nothing to offer him by way of wisdom or perspective because they have chosen a “small part” in the play. Meanwhile, the Private sees things that he wishes he could change but can’t tell the General about or he will be punished for “speaking up”. So he obeys, and he obeys very very well. And the “small parts”, unaddressed, leak hundreds of thousands of dollars.
At times, the non-management employee will speak up when encouraged to do so, because the punishing and hidden rules and regulations of corporate culture - don’t challenge your boss, don’t have “too strong” an opinion, don’t point out the problems - are largely hidden until one is slapped down. One must step carefully in showing vision or strength beyond one’s limited number of defined tasks or court suddenly finding oneself in the trenches with implied power, control, and fear.
Very few people feel worthy of the good and the high positions that may come their way. It takes an emotionally mature, brave and “servant” leader to release his/her hold on defensive superiority and instead remain open to solutions that come from the unexpected.
“Conquer or die”
Another Army “must” that leaks into the corporate culture as an assumed motivator, but which stops cooperation and co-creation, is the idea that we must “win” against our competitors first and foremost. We must “win” these sales goals. We must “win” against our competitors. This goal of fighting to win is one that people at the top might well find more inspiring and personally stainable because (1) upper management is closer to the blame for a company’s failure, so for them the bottom line has become a more well-defined servant, and (2) they can afford that kind of stress, having the money and the flexibility of more paid time off to destress when necessary - at least, far, far more often than the people “on the bottom”.
New and far more interesting answers exist to the financial bottom-line’s “win at all costs” problem, but only if management is motivated to do something other than “conquer”. Conquering works for the people at the top, but for the people at the bottom, motivation has an entirely different flavor.
For the people at the bottom, motivation is based in more personal elements such as recognition, involvement, respect and professional growth. Building these motivations into the structure of a company gives that company some of the rocket fuel it needs to take off and remain in the air.
Instead, telling non-management personnel that the company must “win” means absolutely nothing to them because they have no direct and immediate stake in that outcome; they will not be held responsible for the company’s failure or success, in the court of public opinion. Additionally, if their dedication has never or rarely been recognized, and their rewards have never or rarely been forthcoming for the exceptional work they do every day, they will not do their jobs as well as they could do them if they were sufficiently motivated. So “winning” - undefined for them other than as “work harder, be dedicated” - is something they can not begin to contribute to.
But contributing in a meaningful way is what they want. It is what everyone in a workplace wants.
Corporate America v. The Army
If the army - particularly the Prussian Army - works so well, and the corporation is built on its formula, why does it not work as well for the corporation as it does for the army?
It is a matter of one of Corporate America’s favorite corporate-speak words: “alignment”.
Simply put, in the army everyone is working for a common goal. The Army’s mission statement is as follows:
The Army Mission, our purpose remains constant: To deploy, fight, and win our Nation's wars by providing ready, prompt, and sustained land dominance by Army forces across the full spectrum of conflict as part of the Joint Force.
“Deploy, fight and win” - these goals are immediate, pressing, and very pointed. Given that goal, your goal as a Private is to serve the greater goal by obeying the presumably informed decisions of your superiors.
Corporate missions instead center around words like “serve, value, customers, help, quality, products, dedication”. These words are fuzzier, less focused and less descriptive than the army missions’ words. This leaves corporations without a shared mission. The upper echelon traditionally focuses on the corporate mission which up until very recently has been to serve the shareholders by way of financial largesse. Where does that mission leave the lower echelon? Customarily, they have no day-to-day investment in pleasing the shareholder; that aspect of business does not touch them and they glean no motivation from that goal. On the other hand, the higher levels will commonly receive multi-millions of dollars for even their less successful efforts. Many CEO’s receive multi-millions in severance after driving a business into extinction.
The lower echelon, verbally motivated by management through threat of punishment or retribution, has to come up with a different set of motivations. Keeping one’s job, or pleasing one’s superiors are hardly food for the soul.
In any case, without going into it at this point in the book, we can agree that without an alignment between higher and lower, there is no pipeline.
Pretending there is one doesn’t actually make it so.
The Biggest Opportunity for Business Transformation in Human History
How’s that for a title? Sounds over-ambitious, to put it mildly.
It isn’t, though.
Big business has the opportunity to literally change our world, if for no other reason than big business has the biggest direct impact on the largest number of people. The opportunity is for business to double and triple its bottom line by doing business in ways that just happen to be more human, more community-driven, more moral.
But first the mind must be opened to see that this is not an oxymoron, but a breathtaking opportunity.
The impact that major businesses has on our lives right now is vast - for both the negative and the positive - as it has the largest immediate impact on every aspect of our world. Looking ahead, the opportunities to gain in every way are abundant, if we are willing to grasp the vision, and the types of realities that emerge from that vision. Planetary, Innovative, Mental/Emotionally Healing, Economics, Culture Change and International Relationship Transformation.
Big Business, the Ball Is In Your Court
PLANETARY IMPACT
International businesses positively impact the planet’s health when they responsibly approach their manufacturing, operations and personnel involvement from a sustainable perspective. COVID has definitely proven this.
Even a small change in a big business’s operations can save unimaginable numbers – and amounts - of resources. We will take a look at the story of a legendary business owner who turned his billion-dollar company into a multi-billion-dollar company by expectedly going sustainable after 20 years of successful business building. A man who couldn’t have cared less about the environment woke up one day to a realization of the ways in which his success was tearing the planet, its ecosystems and its livability apart. Determinedly convincing his initially confused company that this new direction would allow them to “do well by doing good”, he not only made a major planetary and business win out of that awakening, but doubled his billions. Years after his death, that work continues at the successful business he built.
We will explore his story in Chapter 10.
INNOVATIVE IMPACT
Dare to believe in transformation, the unknown, the yet undiscovered, and that you can be the one to find some of it.
“Last year, the NGO gave renewed hope to a small port town in Kenya last year when they installed a solar-powered plant that transforms salty ocean water into fresh drinking water.”
Transforming ocean saltwater into fresh drinking water gives the lie to the idea that there is only so much of one thing to go around. There is transformation. If you are of a spiritual nature, you know - and in some cases have even seen (I know of a number of cases in India) - that transforming the element of one kind of liquid into another kind is real.
“Israel Antonio Briseño Carmona, a civil engineering student at the Autonomous University of Coahuila in Torreón, Mexico, created the new self-regenerating pavement as a means to address the problem of damaged pavement and potholes in cities where rain occurs regularly, as is the case across Mexico.
The new invention could save billions of dollars on infrastructure costs for governments and construction companies around the world.”
We have everything we need to create everything we need. It takes a willingness to see differently, a curiosity about what-could-be, and an absolute refusal to take everything at face value.
When we refuse to see only what seems to be right in front of our eyes, and no more, is life-giving. That refusal is what leads us to the spaces in which we create innovation and better the world for countless others.
“According to Greenpeace, over 12 million tonnes of plastic end up in our oceans each year. The effect on the ocean’s inhabitants is startling, with all variations of plastic causing major problems for Plankton, Blue Whale and everything in between. A massive amount of that plastic comes from plastic water bottles – Coca Cola alone produces an estimated 100 billion plastic bottles every year!”
UK start-up Skipping Rocks Lab has developed a potentially world-changing product that offers an alternative to plastic bottles.
Oooho is made from seaweed and plants, so its totally biodegradable; its edible and can be flavored and colored; plus it’s cheaper than plastic! This product could potentially hold almost anything a plastic container could – including cosmetics and alcohol – so there’s no good reason we shouldn’t start seeing these all over the place pretty soon!”
Solutions from new ideas are everywhere. If you are a business person who appreciates having a new field to play in, this should be extremely exciting to consider.
MENTAL/EMOTIONAL HEALTH
“Let’s keep emotion out of the workplace.” So goes the traditional business instruction.
There are few other sentences that can make me see purple as quickly as that one.
We can’t actually do that even if we would want to. The only way to keep emotion out of the workplace is to hire machines to do the work. And people are not machines. When businesses champion this false instruction, everything is reduced: the promise of your people, your profits, the health of your industry, your creativity quotient and therefore your ability to grow and transform. The price is indescribably hefty.
Machines run down. They don’t talk about it, complain about it. They just...run down. We replace their parts and they keep going...until they don’t. They don’t run slower if their feelings or hurt or if some part of them “dies” and has to be replaced. They don’t take days off and talk smack about their employers on social media and suddenly decide to leave the business and take another job!
Employees, on the contrary, undergo depression, heart-impacting stress, anxiety, and as a result their work product suffers; not from a lack of care about the quality of their work - as is most often assumed by those who manage them - but because they are physically and emotionally hampered.
Serve the needs of the people “on the floor”, and the roof of your house will blow up in the most pleasing of ways. Happier people make for the emotional ease to come up with those innovations we are all seeking.
“If you are a business owner and/or CEO, you may be wondering if your employees’ mental health is impacting your company.
Financially, mental illness can have a huge impact on a company’s bottom line. According to the American Psychiatric Association, depression alone costs employers an estimated $44 billion each year in lost productivity.
Incredibly, this figure does not include the indirect cost of someone who is present at work but is not fully productive because they are battling their illness or thinking about a loved one who is suffering.”
** ECONOMICS
Because non-management employees are generally seen as worthy of – and needing only – small compensations as rewards for work well done, the non-management employee struggles in ways that become hidden from management. As a result, the true problems are never identified – nor sought – and the true answers are never found.
CULTURE
“Stephen Sadove, chairman and chief executive of Saks, agrees that culture drives numbers: “Culture drives innovation and whatever else you are trying to accomplish within a company — innovation, execution, whatever it’s going to be. And that then drives results,” he said in a New York Times interview. “When I talk to Wall Street, people really want to know your results, what are your strategies, what are the issues, what it is that you’re doing to drive your business. Never do you get people asking about the culture, about leadership, about the people in the organization. Yet it’s the reverse, because it’s the people, the leadership, and the ideas that are ultimately driving the numbers and the results.”
Because we can see the outward manifestations of work performance like products shipped, revenues booked, and earnings-per-share, we can discuss them in analysts calls and at management meetings. We can barely see and surely can’t measure the cultural aspect of what makes great products, revenues or earnings per share. But that doesn’t mean it can’t be decoded.
After working on strategy for 20 years, I can say this: culture will trump strategy, every time. The best strategic idea means nothing in isolation. If the strategy conflicts with how a group of people already believe, behave or make decisions it will fail. Conversely, a culturally robust team can turn a so-so strategy into a winner. The “how” matters in how we get performance. Yes, it does.
Nilofer Merchant is a corporate advisor and speaker on innovation methods. Her book, The New How, discussing collaborative ways to have your whole company strategize, was published in 2010. Follow her on Twitter @nilofer. https://hbr.org/2011/03/culture-trumps-strategy-every
INTERNATIONAL PARADIGMATIC SHIFTS
Let me put this simply: If you can’t speak to your own people successfully and acknowledge them as being as important as you are to the beating heart of your organization, how on earth are you going to speak to people in different cultures? How are you going to change the paradigm of belief under which we labor? How will you contribute to saving the planet for your children and their children?
We have labored under beliefs that underpin our worst behaviors. And now, when the world seems to be reflecting the truth of those beliefs, is when we have to step up and dare to believe in their opposites.
We believe that there is a limited amount of supply. As a result we live in greed borne of fear that if we don’t get our share, we will suffer.
We believe that there are worthy people and unworthy people. As a result, we neglect the worth and beauty of those around us, and we limit ourselves, our businesses, our families, our communities, and our planet.
We believe that our circumstances alone show that we are worthy and superior. As a result, we live in a constant fight stance to maintain our “place”, rather than align ourselves with what brings us the kind of joy in life that transforms our attitudes, our families, and our ripple-effect possibilities.
Now, imagine that we held different beliefs based on realities that support them, so we are not “betting the farm” on wishful thinking.
What if we believed, and knew, instead, that:
There is infinite supply if we dare to do things together as a business, rather than as splintered areas forever viewed with distrust.
If money is your game, you might want to look at the Netherlands’ motto, “Twice as much food using half as many resources.” Imagine using 50% less than your current expenses to gain twice as much product.
“The Netherlands is the number two exporter of food as measured by value in the entire world, coming in second to the United States. The U.S. has 270 times the landmass. How have they been done it? For one, 80 percent of their cultivated land is contained in greenhouses, which makes every "field" into its own little eco-system where every aspect is controlled, contained, and used to the best of its ability. Farmers are now agricultural scientists, monitoring soil health, air, and yields with drones and monitors as though farming on a futuristic spaceship.”
The farmer responsible for thinking outside the barn is named Ernst van den Ende. Marrying both sustainability and financial gain, van den Ende explains “that one metric ton of soy protein can be produced on a piece of land in a year that could produce 150 tons of insect protein in the same time”; this explains why he has chosen to feed his cows...grasshoppers. A brilliantly creative solution which is also time-saving and sustainable.
While we are in this part of the world, I will add that Dutch seed firms are now world leaders in this industry. They have responded - also creatively - to the European Union’s rules regarding how one may genetically modify GMO’s, by working with molecular breeding. Molecular breeding not only avoids the addition of foreign and questionable elements into the seeds, but the seeds are often “ready for sale and use in half the time”. And this is not “new” thinking - this is a reclaiming of the older, more human/humane approach to business. Working with seeds in this way is as old as agricultural time.
So if “time is money” is your bread and butter, this information about the Netherlands should be of interest to you.
Europe is already getting off of the train and building new corporate and non-corporate structures.
The Human Sustainability movement has been in place for four decades, but with a small voice. Until recently. Now, it is growing louder, and revealing its lack of human solutions, and its desire to find them. Now.
On August 19, 2019, the Business Roundtable, that body which since 1978 has issued periodic Principles of Corporate Governance, importantly dropped its adherence to the shareholder as business’s raison d’être. To say this came as a surprise is to understate the impact.
“Americans deserve an economy that allows each person to succeed through hard work and creativity and to lead a life of meaning and dignity. We believe the free-market system is the best means of generating good jobs, a strong and sustainable economy, innovation, a healthy environment and economic opportunity for all.”
The words “economic opportunity for all” leave me to question whether that opportunity will be at all equal - or at the very least not separated by the current norms of 400% or more. However, real transformation comes from a change in perception, and it seems that perceptions are indeed changing.
“The American dream is alive, but fraying,” said Jamie Dimon, Chairman and CEO of JPMorgan Chase & Co. and Chairman of Business Roundtable. “Major employers are investing in their workers and communities because they know it is the only way to be successful over the long term. These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.”
“This new statement better reflects the way corporations can and should operate today,” added Alex Gorsky, Chairman of the Board and Chief Executive Officer of Johnson & Johnson and Chair of the Business Roundtable Corporate Governance Committee. “It affirms the essential role corporations can play in improving our society when CEOs are truly committed to meeting the needs of all stakeholders.”
Industry leaders also lent their support for the updated Business Roundtable Statement, citing the positive impact this commitment will have on long-term value creation:
“I welcome this thoughtful statement by Business Roundtable CEOs on the Purpose of a Corporation. By taking a broader, more complete view of corporate purpose, boards can focus on creating long-term value, better serving everyone – investors, employees, communities, suppliers and customers,” said Bill McNabb, former CEO of Vanguard.
“CEOs work to generate profits and return value to shareholders, but the best-run companies do more. They put the customer first and invest in their employees and communities. In the end, it’s the most promising way to build long-term value,” said Tricia Griffith, President and CEO of Progressive Corporation.
“This is tremendous news because it is more critical than ever that businesses in the 21st century are focused on generating long-term value for all stakeholders and addressing the challenges we face, which will result in shared prosperity and sustainability for both business and society,” said Darren Walker, President of the Ford Foundation.
The worker may not yet have an equal seat at the table, but it is both a relief and an insult that after all of this time, they are at the very least acknowledged.
Acknowledgment is good, but actually knowing the nature of their day-to-day reality under the current business system is mandatory if we are to understand that a quick fix is not going to do it.
Too few people know of these pioneers...yet. But we’re about to. And we have to become pioneers now, all of us.
The time to make a complete 180 has come down upon us like the proverbial freight train, and we can no longer hide behind “It’s too hard!” or “It can’t be done!” Bullshit. Of course it’s hard, and isn’t that why we need to put our human ingenuity in gear, and our creative thinking, and let go of the me-me-me and mine-mine-mine, and understand that it is all about “our”. And as to “it can’t be done” - that’s ridiculous and I would invite you to look at what we communicate with: computers, applications like Zoom and Skype. Let me assure you that just 50 or 60 years ago - just 50 or 60; the 1950’s and 1960’s! - people would have said, “Oh, there’s no way we could ever talk to one another and see each other’s faces! No way! There’s no way we could ever be like the Star Trek people with ‘communicators’ in our hands.”
It took the Coronavirus - it took a freaking planetary pandemic! - to reveal just how broken our business-as-usual system always was.
Now a new era of life is upon us. We hear the phrase “our new normal”. But what is that? Here we are, 150 years of post-Industrial Revolution under our belt with our adherence to top-down, power-over rules which have been punishing and demeaning to those below the power line, frustrating but financially rewarding to middle management, and cash-cow power-slinging opportunities to those at the top.
And that “normal” gave all of us drinking problems, resentments, heart attacks, negatively life-altering differences in pay. That “normal” made the same damn problems arise day after day for decade after decade: attrition, engagement, “personnel problems”, and the stress of having to come up with something new to try...unsuccessfully.
We have been missing something in our business-as-usual. And that something is big. Scratch that; it’s enormous. But the good news is that when we see it and craft our work, our systems, our attitudes to that “invisible” core aspect, every single thing is impacted for the better.
I mean everything. And everyone: Business, the people in business, customers, clients, communities, and our planet.That’s kinda big.
So, what is this big something and where is it hiding that we’ve been able to ignore it for 150 years?
It is something hidden behind false narratives about the miniscule place of the human being in life and specifically in business: that we are in service, and enslavement, to something bigger and more important than ourselves. That the human doing the work is the dismissable servant to the gods of money and progress. Replaceable. Responsible. But never authentic. Never generative. Never ever as important as the bottom line. And never ever as important as the person on the ladder rung above.
With the hierarchical mindset born of this idea, management and non-management alike can easily assume the so-called “rank and file” in any business structure to be less capable, less unique, and more easily replaced. Like a machine part.
As a result, answers are applied hierarchically; top-down. The usual business problems - attrition, lack of engagement, ineffective procedures, financial constraints - are approached only with known solutions: trainings, pulse surveys, assessments, redesigned departmental structures, financial cuts, new health insurance, free lunches, holiday parties. Shall we be honest? None of those solutions really leads to big wins. After the money, the time, the planning, we find that we still have the high attrition, the lack of employee engagement, and the high cost of having to effect trainings repeatedly in order to meet the new employees coming through the revolving door. We still have financial struggles and the daily disappointment and stress of never. quite. getting. there.
We never quite get to a satisfying sense of having accomplished something that moved the needle, solved the real problem, freed us to move on to something else…something new.
What is the problem?
The problem is a blindness to the importance of humanness - of life and its quality. Business has been steadfastly blind to where to find and how to use the greatest resource on planet earth: the human being.
This greatest of resources is us. The answer to all of our questions about business systems and business “problems” is right in front of us and hidden in plain sight: it is the minds, the creativity, the humanness, the experience, the contributions and the insight of our non-management colleagues. It is the human factors taken as our focus and core reason for being; even and especially in business.
In this time of paradigmatic shifts, we have to get excited about the positive shifts we want to make, and we have to be willing to court some seriously good results. Sounds like a good thing, right?
And yet we have resisted. We have met the well-known definition of insanity: “doing the same thing over and over again and expecting different results” by insanely trying the same solutions over and over and over again. There are human answers to these problems which we cannot see because we are blinded by data.
Attrition - “Let’s hire ‘better people’. Let’s try ‘better trainings’. But let’s not create an environment that actually keeps people around. That would be too expensive.”
Lack of engagement - “Let’s offer prizes! Let’s give them a day to put on a Christmas show for us! Let’s give them free soup at lunch! That’ll solve the lack of enthusiasm around here!”
Lack of trust - “They don’t trust us? Let’s be friends, then! Let’s have coffee get-togethers, ice-cream socials and Appreciation Days! ...What? You want vulnerability? You want us to consider your ideas? Okay, well we heard your ideas and your feedback, and it’s clear that you just don’t know what you’re talking about. Would you like some more coffee with your ice cream?”
The problem and solution are right in front of us
None of the solutions we worked with for so long are successful in moving the needles, creating vibrancy in our organizations nor building regenerative solutions without our willingness to see and address what is, as it is. The critical technical error we are making is akin to trying to build a house starting with the roof. The critical human error we are making is akin to trying to make a computer out of a human being.
The people at the so-called bottom receive the run-off of frustration which cascades down from the top. They are, as a group, steadfastly ignored, disrespected, and denied permission for self-empowerment or growth. There is blame, emotional abuse, power-slinging, gaslighting, unfair firings without recourse, infantilizing attitudes, deafness to input, punishment for daring to show strength or smarts or promise.
And after all of that, there is an unrealistic expectation from manager and corporate leaders alike that there “should be” enthusiasm, engagement, dedication, and above all cheerful obedience.
This simple, oxymoronic and illogical mindset culled from the top-down, better-than-you business structure has killed not just individual careers and spirits, but has also hidden billions if not trillions of dollars from the eyes and hands of those who have adhered to this setup for so very long.
The business part of this lack-of-humanity problem starts - and ends - with a structure and culture that lauds a fracturing, conquering philosophy. That problem arose in 1832, and it all began with a train wreck.
The Train Wreck That Gave Birth to an Org Chart
Our top-down organizational structure came into focus as the result of a train wreck in 1841 between two Western Railroad passenger trains. The accident killed a conductor and one passenger, and injured 17 others. What the wreck did was highlight the fact that the business owners, whose post-Industrial Revolution business had grown to three geographically disparate branches, felt they had too little control over the day-to-day workings of their railroad. They became aware that they could not account for nor predict problems, so an understandable desire arose on their part to: (1) not do everything possible to avoid such a situation in the future, (2) to hold someone accountable for the problems, and (3) to find someone responsible who could avoid such events.
“ ‘…. That disaster marked the beginning of a new management era.’] These words open Peter Scholtes’ classic book on leadership. He goes on to explain how the term "management" was unknown in the days of cottage industries. As business grew and became geographically disperse in the 1800's, a way to run these businesses had to be found. But there were no models outside the church and the military, so investigators into the train-wreck disaster looked to the Prussian army for a model. And there they found the classic organization chart - the one we know so well today. Scholtes calls it the "train-wreck" chart. It was revolutionary at the time.
The purpose of what became today's organization chart was clear: The assignment of responsibility would enable "prompt detection of derelictions of duty... and point out the delinquent." Scholtes says: "A fundamental premise of the 'train-wreck' approach to management is that the primary cause of problems is 'dereliction of duty'. The purpose of the organizational chart is to sufficiently specify those duties so that management can quickly assign blame, should another accident occur."
…Note the thinking here: Problems are caused by people who don't do their job well, so finding someone to blame is the first step to correcting problems. [bolding by the author]
The army solution is extremely impersonal. Positions and duties are defined, one person per position is then measured by how well they fill that position and carry out the duties assigned by the “superior” above. Moreover, every level reporting to the level above is judged without remedy.
Hence the advent of Human Resources. This department was going to fix the inhumanity problem and put someone in the corner of the employee who was not simultaneously taking a stand against the company. A very narrow line to straddle, admittedly.
Blaming someone else for a problem is hardly a new human tendency. However, with the org chart and the army solution now routinized in business, this tactic of find-the-problem-fix-the-problem became the practical focus – one that has not really changed since the 1800’s.
Unsurprisingly, an unchanged 1800’s solution is no longer as successfully applicable in the 2000’s. The top-down, hold-someone-responsible attitude has backed up on business in ways that the business community either does not see, or does see but does not believe that there is a solution to the problem. That blindness costs us everything from the vibrancy and excitement of a day-to-day transformational attitude, to the persistent glass ceiling that women - even entrepreneurial women - push against with limited success even now, and limiting and even reversing the bottom line.
An army-like approach operates under an assumption of unquestioning obedience from below, and unquestioned direction from above. In the world of business operating in a time of increasingly dehumanizing and computerized perspectives, the challenge and the need to break this mold and redefine the meaning and goals of business has never been greater.
The Army Structure: From the Top, Down, Do As You’re Told
A General and a Private walk into a bar…
No. They don’t. They are separated by rank and perceived importance and they do not drink in the same bar. The General carries the weight of the world on his shoulders and the Private carries the weight of his duties on his shoulders from following as well as he can the orders of the people above him.
Implied in the status of each of these individuals is that one is more important, wiser, and more valuable than the other.
But I beg to differ. While I clearly see the difference in the nature and responsibility of their positions, I also see what is being missed. I mean, have you seen the movie Forrest Gump? Forrest connects with everyone personally, and in the same way: honestly, directly, unflinchingly.
All of us - even the so-called “least” of us - have gifts, ideas, perspectives which when given the opportunity to meld with others’, hold the magic that transforms, rescues, and impacts the personal and business worlds of those around us. Suddenly, “work life” and “regular life” have a meaningful link.
Instead, we continue to hamstring ourselves with wrong thinking about leadership. Holding the assumption in place that the “General” must be intrinsically more important/wiser/more valuable than those below him, the General of Industry thinks that he must come up with all of the answers or appear weak, and he operates on the assumption that the people below him have little or nothing to offer him by way of wisdom or perspective because they have chosen a “small part” in the play. Meanwhile, the Private sees things that he wishes he could change but can’t tell the General about or he will be punished for “speaking up”. So he obeys, and he obeys very very well. And the “small parts”, unaddressed, leak hundreds of thousands of dollars.
At times, the non-management employee will speak up when encouraged to do so, because the punishing and hidden rules and regulations of corporate culture - don’t challenge your boss, don’t have “too strong” an opinion, don’t point out the problems - are largely hidden until one is slapped down. One must step carefully in showing vision or strength beyond one’s limited number of defined tasks or court suddenly finding oneself in the trenches with implied power, control, and fear.
Very few people feel worthy of the good and the high positions that may come their way. It takes an emotionally mature, brave and “servant” leader to release his/her hold on defensive superiority and instead remain open to solutions that come from the unexpected.
“Conquer or die”
Another Army “must” that leaks into the corporate culture as an assumed motivator, but which stops cooperation and co-creation, is the idea that we must “win” against our competitors first and foremost. We must “win” these sales goals. We must “win” against our competitors. This goal of fighting to win is one that people at the top might well find more inspiring and personally stainable because (1) upper management is closer to the blame for a company’s failure, so for them the bottom line has become a more well-defined servant, and (2) they can afford that kind of stress, having the money and the flexibility of more paid time off to destress when necessary - at least, far, far more often than the people “on the bottom”.
New and far more interesting answers exist to the financial bottom-line’s “win at all costs” problem, but only if management is motivated to do something other than “conquer”. Conquering works for the people at the top, but for the people at the bottom, motivation has an entirely different flavor.
For the people at the bottom, motivation is based in more personal elements such as recognition, involvement, respect and professional growth. Building these motivations into the structure of a company gives that company some of the rocket fuel it needs to take off and remain in the air.
Instead, telling non-management personnel that the company must “win” means absolutely nothing to them because they have no direct and immediate stake in that outcome; they will not be held responsible for the company’s failure or success, in the court of public opinion. Additionally, if their dedication has never or rarely been recognized, and their rewards have never or rarely been forthcoming for the exceptional work they do every day, they will not do their jobs as well as they could do them if they were sufficiently motivated. So “winning” - undefined for them other than as “work harder, be dedicated” - is something they can not begin to contribute to.
But contributing in a meaningful way is what they want. It is what everyone in a workplace wants.
Corporate America v. The Army
If the army - particularly the Prussian Army - works so well, and the corporation is built on its formula, why does it not work as well for the corporation as it does for the army?
It is a matter of one of Corporate America’s favorite corporate-speak words: “alignment”.
Simply put, in the army everyone is working for a common goal. The Army’s mission statement is as follows:
The Army Mission, our purpose remains constant: To deploy, fight, and win our Nation's wars by providing ready, prompt, and sustained land dominance by Army forces across the full spectrum of conflict as part of the Joint Force.
“Deploy, fight and win” - these goals are immediate, pressing, and very pointed. Given that goal, your goal as a Private is to serve the greater goal by obeying the presumably informed decisions of your superiors.
Corporate missions instead center around words like “serve, value, customers, help, quality, products, dedication”. These words are fuzzier, less focused and less descriptive than the army missions’ words. This leaves corporations without a shared mission. The upper echelon traditionally focuses on the corporate mission which up until very recently has been to serve the shareholders by way of financial largesse. Where does that mission leave the lower echelon? Customarily, they have no day-to-day investment in pleasing the shareholder; that aspect of business does not touch them and they glean no motivation from that goal. On the other hand, the higher levels will commonly receive multi-millions of dollars for even their less successful efforts. Many CEO’s receive multi-millions in severance after driving a business into extinction.
The lower echelon, verbally motivated by management through threat of punishment or retribution, has to come up with a different set of motivations. Keeping one’s job, or pleasing one’s superiors are hardly food for the soul.
In any case, without going into it at this point in the book, we can agree that without an alignment between higher and lower, there is no pipeline.
Pretending there is one doesn’t actually make it so.
The Biggest Opportunity for Business Transformation in Human History
How’s that for a title? Sounds over-ambitious, to put it mildly.
It isn’t, though.
Big business has the opportunity to literally change our world, if for no other reason than big business has the biggest direct impact on the largest number of people. The opportunity is for business to double and triple its bottom line by doing business in ways that just happen to be more human, more community-driven, more moral.
But first the mind must be opened to see that this is not an oxymoron, but a breathtaking opportunity.
The impact that major businesses has on our lives right now is vast - for both the negative and the positive - as it has the largest immediate impact on every aspect of our world. Looking ahead, the opportunities to gain in every way are abundant, if we are willing to grasp the vision, and the types of realities that emerge from that vision. Planetary, Innovative, Mental/Emotionally Healing, Economics, Culture Change and International Relationship Transformation.
Big Business, the Ball Is In Your Court
PLANETARY IMPACT
International businesses positively impact the planet’s health when they responsibly approach their manufacturing, operations and personnel involvement from a sustainable perspective. COVID has definitely proven this.
Even a small change in a big business’s operations can save unimaginable numbers – and amounts - of resources. We will take a look at the story of a legendary business owner who turned his billion-dollar company into a multi-billion-dollar company by expectedly going sustainable after 20 years of successful business building. A man who couldn’t have cared less about the environment woke up one day to a realization of the ways in which his success was tearing the planet, its ecosystems and its livability apart. Determinedly convincing his initially confused company that this new direction would allow them to “do well by doing good”, he not only made a major planetary and business win out of that awakening, but doubled his billions. Years after his death, that work continues at the successful business he built.
We will explore his story in Chapter 10.
INNOVATIVE IMPACT
Dare to believe in transformation, the unknown, the yet undiscovered, and that you can be the one to find some of it.
“Last year, the NGO gave renewed hope to a small port town in Kenya last year when they installed a solar-powered plant that transforms salty ocean water into fresh drinking water.”
Transforming ocean saltwater into fresh drinking water gives the lie to the idea that there is only so much of one thing to go around. There is transformation. If you are of a spiritual nature, you know - and in some cases have even seen (I know of a number of cases in India) - that transforming the element of one kind of liquid into another kind is real.
“Israel Antonio Briseño Carmona, a civil engineering student at the Autonomous University of Coahuila in Torreón, Mexico, created the new self-regenerating pavement as a means to address the problem of damaged pavement and potholes in cities where rain occurs regularly, as is the case across Mexico.
The new invention could save billions of dollars on infrastructure costs for governments and construction companies around the world.”
We have everything we need to create everything we need. It takes a willingness to see differently, a curiosity about what-could-be, and an absolute refusal to take everything at face value.
When we refuse to see only what seems to be right in front of our eyes, and no more, is life-giving. That refusal is what leads us to the spaces in which we create innovation and better the world for countless others.
“According to Greenpeace, over 12 million tonnes of plastic end up in our oceans each year. The effect on the ocean’s inhabitants is startling, with all variations of plastic causing major problems for Plankton, Blue Whale and everything in between. A massive amount of that plastic comes from plastic water bottles – Coca Cola alone produces an estimated 100 billion plastic bottles every year!”
UK start-up Skipping Rocks Lab has developed a potentially world-changing product that offers an alternative to plastic bottles.
Oooho is made from seaweed and plants, so its totally biodegradable; its edible and can be flavored and colored; plus it’s cheaper than plastic! This product could potentially hold almost anything a plastic container could – including cosmetics and alcohol – so there’s no good reason we shouldn’t start seeing these all over the place pretty soon!”
Solutions from new ideas are everywhere. If you are a business person who appreciates having a new field to play in, this should be extremely exciting to consider.
MENTAL/EMOTIONAL HEALTH
“Let’s keep emotion out of the workplace.” So goes the traditional business instruction.
There are few other sentences that can make me see purple as quickly as that one.
We can’t actually do that even if we would want to. The only way to keep emotion out of the workplace is to hire machines to do the work. And people are not machines. When businesses champion this false instruction, everything is reduced: the promise of your people, your profits, the health of your industry, your creativity quotient and therefore your ability to grow and transform. The price is indescribably hefty.
Machines run down. They don’t talk about it, complain about it. They just...run down. We replace their parts and they keep going...until they don’t. They don’t run slower if their feelings or hurt or if some part of them “dies” and has to be replaced. They don’t take days off and talk smack about their employers on social media and suddenly decide to leave the business and take another job!
Employees, on the contrary, undergo depression, heart-impacting stress, anxiety, and as a result their work product suffers; not from a lack of care about the quality of their work - as is most often assumed by those who manage them - but because they are physically and emotionally hampered.
Serve the needs of the people “on the floor”, and the roof of your house will blow up in the most pleasing of ways. Happier people make for the emotional ease to come up with those innovations we are all seeking.
“If you are a business owner and/or CEO, you may be wondering if your employees’ mental health is impacting your company.
Financially, mental illness can have a huge impact on a company’s bottom line. According to the American Psychiatric Association, depression alone costs employers an estimated $44 billion each year in lost productivity.
Incredibly, this figure does not include the indirect cost of someone who is present at work but is not fully productive because they are battling their illness or thinking about a loved one who is suffering.”
** ECONOMICS
Because non-management employees are generally seen as worthy of – and needing only – small compensations as rewards for work well done, the non-management employee struggles in ways that become hidden from management. As a result, the true problems are never identified – nor sought – and the true answers are never found.
CULTURE
“Stephen Sadove, chairman and chief executive of Saks, agrees that culture drives numbers: “Culture drives innovation and whatever else you are trying to accomplish within a company — innovation, execution, whatever it’s going to be. And that then drives results,” he said in a New York Times interview. “When I talk to Wall Street, people really want to know your results, what are your strategies, what are the issues, what it is that you’re doing to drive your business. Never do you get people asking about the culture, about leadership, about the people in the organization. Yet it’s the reverse, because it’s the people, the leadership, and the ideas that are ultimately driving the numbers and the results.”
Because we can see the outward manifestations of work performance like products shipped, revenues booked, and earnings-per-share, we can discuss them in analysts calls and at management meetings. We can barely see and surely can’t measure the cultural aspect of what makes great products, revenues or earnings per share. But that doesn’t mean it can’t be decoded.
After working on strategy for 20 years, I can say this: culture will trump strategy, every time. The best strategic idea means nothing in isolation. If the strategy conflicts with how a group of people already believe, behave or make decisions it will fail. Conversely, a culturally robust team can turn a so-so strategy into a winner. The “how” matters in how we get performance. Yes, it does.
Nilofer Merchant is a corporate advisor and speaker on innovation methods. Her book, The New How, discussing collaborative ways to have your whole company strategize, was published in 2010. Follow her on Twitter @nilofer. https://hbr.org/2011/03/culture-trumps-strategy-every
INTERNATIONAL PARADIGMATIC SHIFTS
Let me put this simply: If you can’t speak to your own people successfully and acknowledge them as being as important as you are to the beating heart of your organization, how on earth are you going to speak to people in different cultures? How are you going to change the paradigm of belief under which we labor? How will you contribute to saving the planet for your children and their children?
We have labored under beliefs that underpin our worst behaviors. And now, when the world seems to be reflecting the truth of those beliefs, is when we have to step up and dare to believe in their opposites.
We believe that there is a limited amount of supply. As a result we live in greed borne of fear that if we don’t get our share, we will suffer.
We believe that there are worthy people and unworthy people. As a result, we neglect the worth and beauty of those around us, and we limit ourselves, our businesses, our families, our communities, and our planet.
We believe that our circumstances alone show that we are worthy and superior. As a result, we live in a constant fight stance to maintain our “place”, rather than align ourselves with what brings us the kind of joy in life that transforms our attitudes, our families, and our ripple-effect possibilities.
Now, imagine that we held different beliefs based on realities that support them, so we are not “betting the farm” on wishful thinking.
What if we believed, and knew, instead, that:
There is infinite supply if we dare to do things together as a business, rather than as splintered areas forever viewed with distrust.
- Everyone has so much to contribute - more, in fact, than we already know – and contributing in a group just multiplies the input
- Our circumstances reflect a very small part of who we actually are, and can become.
- If we let go of a little control, we gain a lot of assistance.
If money is your game, you might want to look at the Netherlands’ motto, “Twice as much food using half as many resources.” Imagine using 50% less than your current expenses to gain twice as much product.
“The Netherlands is the number two exporter of food as measured by value in the entire world, coming in second to the United States. The U.S. has 270 times the landmass. How have they been done it? For one, 80 percent of their cultivated land is contained in greenhouses, which makes every "field" into its own little eco-system where every aspect is controlled, contained, and used to the best of its ability. Farmers are now agricultural scientists, monitoring soil health, air, and yields with drones and monitors as though farming on a futuristic spaceship.”
The farmer responsible for thinking outside the barn is named Ernst van den Ende. Marrying both sustainability and financial gain, van den Ende explains “that one metric ton of soy protein can be produced on a piece of land in a year that could produce 150 tons of insect protein in the same time”; this explains why he has chosen to feed his cows...grasshoppers. A brilliantly creative solution which is also time-saving and sustainable.
While we are in this part of the world, I will add that Dutch seed firms are now world leaders in this industry. They have responded - also creatively - to the European Union’s rules regarding how one may genetically modify GMO’s, by working with molecular breeding. Molecular breeding not only avoids the addition of foreign and questionable elements into the seeds, but the seeds are often “ready for sale and use in half the time”. And this is not “new” thinking - this is a reclaiming of the older, more human/humane approach to business. Working with seeds in this way is as old as agricultural time.
So if “time is money” is your bread and butter, this information about the Netherlands should be of interest to you.
Europe is already getting off of the train and building new corporate and non-corporate structures.
The Human Sustainability movement has been in place for four decades, but with a small voice. Until recently. Now, it is growing louder, and revealing its lack of human solutions, and its desire to find them. Now.
On August 19, 2019, the Business Roundtable, that body which since 1978 has issued periodic Principles of Corporate Governance, importantly dropped its adherence to the shareholder as business’s raison d’être. To say this came as a surprise is to understate the impact.
“Americans deserve an economy that allows each person to succeed through hard work and creativity and to lead a life of meaning and dignity. We believe the free-market system is the best means of generating good jobs, a strong and sustainable economy, innovation, a healthy environment and economic opportunity for all.”
The words “economic opportunity for all” leave me to question whether that opportunity will be at all equal - or at the very least not separated by the current norms of 400% or more. However, real transformation comes from a change in perception, and it seems that perceptions are indeed changing.
“The American dream is alive, but fraying,” said Jamie Dimon, Chairman and CEO of JPMorgan Chase & Co. and Chairman of Business Roundtable. “Major employers are investing in their workers and communities because they know it is the only way to be successful over the long term. These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.”
“This new statement better reflects the way corporations can and should operate today,” added Alex Gorsky, Chairman of the Board and Chief Executive Officer of Johnson & Johnson and Chair of the Business Roundtable Corporate Governance Committee. “It affirms the essential role corporations can play in improving our society when CEOs are truly committed to meeting the needs of all stakeholders.”
Industry leaders also lent their support for the updated Business Roundtable Statement, citing the positive impact this commitment will have on long-term value creation:
“I welcome this thoughtful statement by Business Roundtable CEOs on the Purpose of a Corporation. By taking a broader, more complete view of corporate purpose, boards can focus on creating long-term value, better serving everyone – investors, employees, communities, suppliers and customers,” said Bill McNabb, former CEO of Vanguard.
“CEOs work to generate profits and return value to shareholders, but the best-run companies do more. They put the customer first and invest in their employees and communities. In the end, it’s the most promising way to build long-term value,” said Tricia Griffith, President and CEO of Progressive Corporation.
“This is tremendous news because it is more critical than ever that businesses in the 21st century are focused on generating long-term value for all stakeholders and addressing the challenges we face, which will result in shared prosperity and sustainability for both business and society,” said Darren Walker, President of the Ford Foundation.
The worker may not yet have an equal seat at the table, but it is both a relief and an insult that after all of this time, they are at the very least acknowledged.
Acknowledgment is good, but actually knowing the nature of their day-to-day reality under the current business system is mandatory if we are to understand that a quick fix is not going to do it.
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