What is your business for? Welcome to the Economy of Meaning

Curly: You know what the secret of life is?
Mitch: No, what?
Curly: This.
Mitch: Your finger?
Curly: One thing. Just one thing. You stick to that and everything else don’t mean shit.
Mitch: That’s great, but what’s the one thing?
Curly: That’s what you’ve got to figure out.

Now, I’m not normally one for finding deep philosophical meaning in movies or song lyrics but, reflecting on a lot of what’s been said on this and other blogs over recent weeks and months, these lines from an old comedy favourite – City Slickers – seem rather apt.

Whether it’s Mike Klein’s recent CommScrum post on The Age of Intent, Umair Haque’s rallying call for business to do “the meaningful stuff that matters most”, or responses from Mary Boone and Grant Young to my post on creating value through sustainability, one unifying thought comes through loud and clear…

Meaning matters like never before.

Umair’s take on this – the quest to create what he calls “thick value” – is illuminating. However, eminent philosopher and management guru, Charles Handy, probably says it best when he poses the fundamental question: whom and what is your business for?

(If you want to read his fabulous 2002 HBR article in full – and I strongly recommend that you do – you can find it here.)

In short, he makes the profound observation that most shareholders these days – though the theoretical owners of a company – are actually nothing more than investors (even gamblers), and that to turn their needs into a purpose (e.g. the “maximising shareholder returns” line, so often the core of companies’ mission statements) is to be guilty of confusing a necessary condition for a sufficient one.

“The purpose of a business,” he concludes, “is not to make a profit, full stop. It is to make a profit so that the business can do something more or better. That ‘something’ becomes the real justification for the business’ existence.”

He continues:

Deep down, the suspicions about capitalism are rooted in a feeling that its instruments, the corporations, are immoral in that they have no purpose other than themselves. To make this assumption may be to do many companies a great injustice, but they have let themselves down through their own rhetoric and behavior. It is salutary to ask about any organization, ‘If it did not exist, would we invent it?’ ‘Only if it could do something better or more useful than anyone else,’ would have to be the answer, and profit would be the means to that larger end.

Couldn’t agree more.

Of course, all this has been said many times before. But in the aftermath of the global financial crisis and other catastrophes, like the BP oil spill in the Mexican Gulf, this has a new resonance. The consequences of “thin value” – of profit decoupled from the people and resources impacted by its generation – have been exposed like never before in our lifetime.

It’s time for businesses to put the organisational “why?” – Curly’s one thing – ahead of the who, the what and the how. Why do you exist? What do you stand for? What higher purpose do you serve? Why should your people drag their arses out of bed in the morning to come and work for you? If your business ceased to exist tomorrow, why should anyone miss you?

If you can’t answer these questions – authentically, materially – then you could well find yourself regretting it. To quote from another much-loved movie: maybe not today, maybe not tomorrow, but soon…