Thursday, February 10, 2011

Euphoric Purpose is the Aim of Democratic Business

Euphoric purpose is the motivation, beyond profits, that drives people to excellence. The transparency, decentralization, consensus, and participatory ownership that embody democratic business exists to create passionate and engaged workers. According to Steven R. Covey, passionate, engaged people spend 60-80 percent of their time working on non-urgent, important activities (e.g., skill building, planning, relationship building, and thinking). People driven by fear spend most of their time on everything else (e.g., deadlines, interruptions, and distractions). According to Covey, not only do passionate, engaged people spend more time on non-urgent, important activities, but they are consequently more productive, successful, and happy.

If Covey's research is right, then we should ask ourselves, 'How many business owners are willing to free up 80 percent or even 60 percent of their workers' time to focus on the important, but not urgent, activities of the business?' For most people, the thought of doing so inspires visions of chaos, diminished productivity, and lost profits. And yet, A study done by Kenexa Research Institute found that of 4,000 worldwide companies, the top 25 engaged workplaces outperformed the 25 lowest engaged businesses 7-to-1 (based on shareholder return, on a five-year basis). Furthermore, a Gallup study of three million employees, published in 2005, calculated that disengagement costs U.S. businesses $350 billion in annual profits. Gallup found that 71 percent of American employees are either “not engaged” or “actively disengaged” from their work. If you think this is only indicative of lazy workers, read on. The Corporate Executive Board reported in 2010 that high-potential employees are increasingly disengaged and seeking new career opportunities. Some 25 percent plan to leave their current employers in the next year compared to 10 percent in 2006. About one in five (21 percent) identify themselves as 'highly disengaged'--a three-fold increase since 2007. With numbers like these, it is no wonder that shows like "the Office" are so popular.

As demonstrated, passionate and engaging workplaces retain better talent and increase profits. Transparency, decentralization, consensus, and participatory ownership are proven ways to inspire and engage workers. We can fix our economy by implementing these principles into American business. The first step is to realize that numbers do not drive people, but people and relationships drive numbers.
(Information taken from,,, and

(See also,

How Will You Measure Your Life?

I recently read this article by Clayton Christiansen out of Harvard entitled, “How will you measure your life?” It is what he tells his students on the final day of his class.

One of the items that he mentions sticks out to me. It reads as follows:

“One of the theories, . . . . . how to be sure we find happiness in our careers—is from Frederick Herzberg, who asserts that the powerful motivator in our lives isn’t money; it’s the opportunity to learn, grow in responsibilities, contribute to others, and be recognized for achievements. I tell the students about a vision of sorts I had while I was running the company I founded before becoming an academic. In my mind’s eye I saw one of my managers leave for work one morning with a relatively strong level of self-esteem. Then I pictured her driving home to her family 10 hours later, feeling unappreciated, frustrated, underutilized, and demeaned. I imagined how profoundly her lowered self-esteem affected the way she interacted with her children. The vision in my mind then fast-forwarded to another day, when she drove home with greater self-esteem—feeling that she had learned a lot, been recognized for achieving valuable things, and played a significant role in the success of some important initiatives. I then imagined how positively that affected her as a spouse and a parent. My conclusion: Management is the most noble of professions if it’s practiced well. No other occupation offers as many ways to help others learn and grow, take responsibility and be recognized for achievement, and contribute to the success of a team. More and more [people think] that a career in business means buying, selling, and investing in companies. That’s unfortunate. Doing deals doesn’t yield the deep rewards that come from building up people."

I’m sure you can see why it sticks out.