The Hindu Business Line : There's a better way to do business

The most successful enterprises in the 21st century will be ethically exemplary and socially-sensitive corporate citizens. The engines of growth will be the enduring values and relationships that self-actualised employees will generate with customers, suppliers, and other stakeholders.

SIX years ago Richard Barrett wrote the book Liberating the Corporate Soul. The central theme of this book is how to build a visionary organisation in the 21st century in the context of the continually changing business climate. The book is particularly useful for the busy manager though he may rarely have the time to read a complete volume.

Business has become a very powerful influence in society at present. Any dominant institution in a community has the responsibility to drive it on the road of rectitude and righteousness. However, Adam Smith, the father of modern economics, had enunciated the doctrine of "the invisible hand", which was expected to guide and propel business houses to respond to the market forces and maintain a dynamic balance.

His theory was based on the principle of free enterprise, and the concept of self-regulating capitalism. But to the dismay of the latter day economists, it was discovered that "the invisible hand" was faltering. A search was launched to find, if any, a better way to do business.

Richard Barrett contends that "there is a better way to do business. A way that encourages every employee to become all he can become. A way that allows people to bring their deepest values to work, and have them celebrated."

In a world wherein competition has become global and knowledge and technology transcend national frontiers, companies have come to realise that the only way to gain advantage over others is by developing better relationships with their people — both inside and outside the company.

For long-term success, a company must become an organic entity that reflects the collective values of its total population. The task of the corporate leader is to engineer this entity: to give the company an identity of its own, and a sense of purpose and vision.

A leader is a person who creates and constructs a vision, and courageously pursues that vision so that it resonates with the souls of the people. And people follow a leader because he is articulating in thought, word, and deed what they feel inside. It is the congruence with the principles and philosophy of a leader that persuades people to follow him.

By this definition, Mahatma Gandhi and Adolf Hitler were both leaders. They held on to a vision with courage and conviction, which resonated with the psyche of the people they led. In one case the resonance was based on compassion, and in the other, fear. The human psyche is of two extremes — the ego and at the soul. The personality of an individual lies somewhere between the two. When an individual is motivated by fear, the personality is reflecting the concerns of the ego. When an individual is motivated by compassion, the personality is reflecting the concerns of the soul. "When we speak of liberating the corporate soul, we are talking about creating a corporate culture that resonates with the values that are held in the souls of employees."

A manager who has the capacity to convert a business into a source of economic wealth pari passu must shoulder the burden to make it a force for social justice. Only then will business begin to nurture values essential to the ethical and moral awakening of society; only then will business fulfil its obligation to build an economy worthy of a free society and a civilisation that is both laudable and lofty.

The fundamental challenge facing a business leader today is to create a corporate culture that enables employees to function at their optimum efficiency. When people find meaning in their work, then they will manifest their best, walk an extra mile when called for and render a superlative performance. And that is when the dichotomy between work and play will disappear.

Such a situation will obtain only when all the employees share a common vision, mission, and values; and, accordingly, operationalise their individual aspirations to correspond with the corporate objectives of the organisation. People prefer to work in organisations which care for them, which provide space for their metaphysical satisfaction and which enable them perform as a wholesome person and bring their own sublime values to work; in short, organisations wherein the corporate soul has been liberated.

Companies perish when they concentrate only on the physical aspects and ignore the spiritual needs of their people. Stephen Covey points out that highly effective people keep all aspects of their lives in balance. The physical well-being of an organisation is determined by its financial success. Profit, cash-flow, return on capital, and shareholder value are some of the indicators which evaluate the physical health of a company.

The problem with such indices is that they focus only on the past. They have no clue about the prospective status of the company. It is like driving a car only with the rear-view mirror, and with no other gauges, or gadgets; without any further information such as the speed at which the car is moving, the condition of the battery, the engine temperature, how long the fuel will last, and so on.

Emotional and spiritual motivation, and not mere financial muscle or physical reengineering, are essential for long-term corporate viability and employee creativity. As business moves ahead in the 21st century, a paradigm shift in the trade practices appears to be on the cards. The old theories of business have become archaic and inadequate.

The new theories of business are value-based and culture-oriented. It is no longer sufficient to deliver a product or service, nor will a sale be closed by the mere exchange of money and invoice. The values which companies stand by will influence and determine the market-share which they enjoy. The most successful enterprises in the 21st century will be ethically exemplary and socially-sensitive corporate citizens.

The ability to empower and empathise with an employee so that he puts his heart and soul into his job requires a kind of managerial skill which is not taught in business schools.

In the companies of tomorrow, the engines of growth will be the enduring values and relationships that self-actualised employees will generate with customers, suppliers, and other stakeholders. Companies will need to focus on fostering a conducive culture and an enabling environment, which will bring satisfaction and a sense of belonging to their employees — what the French call as the esprit de corps.

If capitalism must survive through this century, it must develop a human face. Organisations need strong alliances to survive the dog-eat-dog competition characteristic of the contemporary era.

In the current situation, eliminating barriers in the process of sharing and facilitating free flow of ideas, information and knowledge will be the constituencies of progress.