Changing the Molecules of the (Board)room

Every Monday night in a cozy Brown Stone on 39th street a group of New Yorkers congregate. I was once one of these New Yorkers. At exactly 6:15 PM I would climb on the small stage, strike my gavel and start the Toastmasters meeting: 

Good evening and welcome. The mission of our New York Toastmasters is to provide a mutually supportive and positive learning environment in which we all have the opportunity to develop communication and leadership skills, which in turn foster self-confidence and personal growth.

People, even Wall St-ers, showed up every Monday. Despite being kicked out of our original home at JP Morgan headquarters, our club doubled in size. At the height of the recession there was a market for self-actualization.

Facing the Fear of Public Tyranny–and Having A Party In the Process

Our club did not just offer best practices to better public speaking–we offered transformation. The mix of practice, constructive feedback and a supportive community-environment, helped our members grow to their full potential. By the time each meeting had concluded at 8:15 PM the molecules in the room had changed.

By the time a Toastmaster finished their journey they could transform from being a script-reading speaker into an Obama-esque story-teller.

Throughout the course of the year our club doubled in size–we were thrilled.

A few members of NY Toastmasters, May 9, 2010 at Columbia University at the Annual Toastmasters Conference

I tell you this story because some companies are doing exactly what Toastmasters does. They help people self-actualize-and generate profits in doing so. This culture is precisely the culture that get’s social media. It is all related.

Your Internals Are Showing

Last week I wrote a post “the Corporate Social Strategist Can’t Move Fast Enough.” Reader responses validated the notion that we need to talk about internal management practices before we talk about technology.

The book Peak: How Great Companies Get Their Mojo From Maslow by CEO of Joie De Vivre Chip Conley reminds us that the base of the pyramid has been mastered. Post industrial revolution we have become so adept at fulfilling our material needs that many of us can’t even see the top of the pyramid. It is not built into our business plans. We see no incentive to climb up to the top of the pyramid to see the view. But a handful have and are reaping the spiritual and financial profits.

Thomas Jefferson, as noted by Peak author Chip Conley, wrote the “unalienable rights of man” to be “life, liberty and the pursuit of happiness.” But today we have forgotten about the last part of the sentence. We are only interested in talking about accountability–literally meaning “ability to count.”

There is a problem with “accountability.” While this might make businesses feel better about being able to create fancy diagrams, statistics and ROI campaigns, some things cannot be counted–and they have been left on the table. Only a a few companies have decided to find out what is possible at the top of Maslow’s pyramid. Here are a few examples of companies who have benefited from this mind-set.

Let My People Go Surfing

Founder and Owner of Retailer Patagonia Yvon Chouinard, author of Let My People Go Surfing, doesn’t believe in strict schedules. Conley highlights this case study in his book and reports that near the Patagonia headquarters when a “surf swell is on its way, you may see a mad dash out the door of both line-level employees and senior executives.”

This is only one example of the many ways Chouinard creates a culture of trust and openness within his organization. As a result of his management principles the company has almost no turnover and very high customer satisfaction.

City of God

Another company highlighted in Peak is Semco, Brazilian manufacturer of centrifuges–equipment that aids in process of making vegetable oil. Ricardo Semlar is the CEO of Semco-a private company that grosses a quarter billion dollars in annual sales. The company questions everything about status quo management. Employees are encouraged to choose their own salaries, set their own hours and have no job titles. Semco has almost zero turnover.

Costco and The Vanguard Group

The focus on short-term profits appears to be the biggest inhibitor to creating a more open corporate culture–one that embraces social. But Costco’s James Sinegal, co-founder and CEO, knows what it’s like to focus on long term gains. He is laughing all the way to the bank with Costco, a $59 billion-per-year company. Sinegal is quoted as saying “Wall Street is in the business of making money between now and next Tuesday.“

Peak highlights the fact that Sinegal only makes $350,000 dollars per year.

Tipping My Hat to Zappos

Zappos’ CEO Tony Hsieh operates in a similar model, and pays himself less than $40,000 dollars per year. While we might know this is not the full picture–it sends a message to employees. You might argue that this hippy dippy idea of “self-actualization” is something limited to the privalege of being a knowledge worker–however if you want this video you will see that Zappos employees who work in the factory are just as happy as those sitting in cubicles.

*More from me regarding   Tony Hsieh of Zappos in a piece released next week on CMS Wire.

The Vanguard Group

Another example of a great company highlighted in Peak is the Vanguard Group, the second largest mutual fund company in the world. John Bogle, CEO and author of The Battle for the Soul of Capitalism said that “stock market investors have increasingly taken a short-term, profit-taking perspective toward their investments.”

Conley agrees and writes:

There is an ongoing conflict in companies between the theory espoused by legendary economist Milton Friedman who advocated “fundamental capitalism,” and what I believe are more enlightened leaders who embrace the philosophy of the long view.

Companies like Whole Foods, Zappos, and even The Vanguard Group who’ve managed to take–what others might see at risks–and are seeing the profits. And it has to do with changing thinking about profits.

Maybe one day companies will disprove Conley’s claim that “the classrooms of graduate business schools and the corridors of Wall Street still focus on market fundamentals more than human fundamentals because business has a natural tendency toward the tangible and rewards short-term performance.”

We are too nervous to not do this now. It’s hurting the economy.

Closing Thoughts About the Pursuit of Happiness at Work

I recently reviewed the Gallup Happiness Poll. The poll’s findings included the fact that the happiest days of 2009 “were on or close to holidays, consistent with previous mood index scores showing that days with more-than-normal time dedicated to socializing with family and friends enhance people’s happiness and enjoyment.”

Maybe one day companies will create cultures that change this statistic. Where self-actualization, at the top of Maslow’s pyramid, is something that happens inside companies. So on this Thanksgiving contemplate the idea of happiness–and how we can bring this feast of pleasures to our workplace.

A wise-man recently told me, there are no rules. “We are just making up reality as we go along.”

Related articles

• The Corporate Social Strategist Can’t Move Fast Enough (cloudave.com)
• At Zappos, Getting Fired For Not Contributing to Company Culture (blogs.forbes.com)
• What Did Maslow Know About Customer Centricity? It Ain’t Happening! (enterpriseirregulars.com)
• Zappos: Life after acquisition (tech.fortune.cnn.com)