The power of People with Meaning and Purpose
Strategists and business leaders tend to forget that growth does not necessarily need to happen though new market entry, or new products. It can also happen through a focus on people and planet.
The sad truth is that the vast majority of employees globally aren’t fully engaged. 84 percent “just come to work”, and don’t bring their full human potential. At least as to an article presented in Harvard Business Review in 2019 (see figure below). The Covid-pandemic hasn’t helped, and many companies – especially in the US – now seem puzzled by ‘the great resignation’, as employees have left corporations in hordes, and it has become harder than ever to fill open positions.
The fact that only 16 percent of employees state that they are fully engaged in their jobs is difficult for most business leaders to grasp, and often believed to be best mitigated through perks, bonuses and salary increases. All this shallowness however ultimately does not engage peoples hearts, and leave us with a lack of purpose and a sense of meaninglessness. People without meaning and purpose however do not flourish and thrive on their jobs. And, they don’t use their full human potential.
A consulting firm with a focus on employee retention, productivity and engagement puts it like this on their blog: “On average, a person will waste over 30 years of their lives in workplaces where they don’t have a sense of purpose and don’t reach their full potential. When we feel unfulfilled by the work we do, we don’t feel accountable. We don’t do our best or go above and beyond. We feel lonely. This affects our physical and psychological well-being to the point that the risk of cancer, heart disease, diabetes and addictions significantly increase. Essentially, we are literally working ourselves to death.”
As a business leader it is also important to know that, according to Gallup, disengaged employees mean 15 percent lower profitability, with 37 percent higher absenteeism, and 18 percent lower productivity. Translated into dollars, this is equivalent to 34 percent of a disengaged employee’s annual salary, or $3,400 for every $10,000 they make.
In this context, it may interest you that even traditional corporate responsibility measures have been well documented to increase engagement over the past decades. Most probably because it brings a sense of meaning larger than the quarterly sales and profits, which are the regular focus in ‘business as usual’.
Already in 2015, a meta-analysis of more than 300 studies in the field of Corporate Responsibility showed a positive relationship with financial performance: it can add strategic business value through protecting the company’s licence to operate and reducing risk, as well as through protecting, nurturing and growing brand and reputational values. It can boost how shareholders view the performance of the firm and enhance the share price and total market value. It can also help increase the commitment, affinity and engagement of employees. This in turn can enhance job performance, increase productivity, reduce turnover, lower absenteeism, and reduce the incidence of employee corruption.
In addition, employee engagement links to corporate responsibility in some sort of virtuous cycle. Together they supposedly reinforce one another and then enhance the financial performance, sales revenue, brand and reputation value, and innovative capability of the firm. In a world where the majority of employees are “just coming to work” and only 16 percent are fully engaged, this is for sure be a true win-win-win – for people, profit and planet.
Corporate social responsibility programmes have, however, over the past decades shown to be more of an “add on”, rather than being truly integrated in the core business. An integrated purpose has, however, explicitly been found to help companies overcome the challenges of slow growth and declining profits, as it supports the people side of the business: “Many high-growth companies use purpose to generate sustained profitable growth, stay relevant in a rapidly changing world, and deepen ties with their stakeholders”.
Sustainability purpose-led companies, such as Patagonia and Unilever, have taken this even further, as they have put sustainability at the very of the core of the business while building a more meaningful business for all. The potential value of engaged employees with a sense of meaning, purpose and higher contribution is simply an extraordinarily important opportunity. For the benefit of everyone.
So why did you as a business leader set your latest visionary aim to reaching 1 billion USD – and rallied people to reach your targets for increased revenue and profits through the traditional pepp-talk about market potential, satisfied customers and promise of hefty bonuses – but lacking the connection to meaning and a higher purpose? Why did you not step back, reflect on how to truly bring people on board, and work on connecting to a meaningful higher purpose with benefits for all stakeholders? Maybe you can find a better way to utilize the full potential of human flourishing, rather than the old-fashioned stick and carrot. Next time, at least you will know better.
Read more in the book: Better Business Better Future: Decode the Good Practices of Sustainability Trailblazers and Transform your Corporate Business, by Elisabet Lagerstedt (2022).