Introduction

If your actions inspire others to dream more, learn more, do more and become more, you are a leader. —John Quincy Adams, the sixth president of the United States

Traditional Utilitarian Economic Philosophy and Practice Has Had Its Day

Over the past thirty years, we have been witness to a string of economic crises occurring at ever-shorter intervals. Violent global shocks coursing through the economy are increasingly also shaking the foundations of the civil societies affected by the process, creating a growing divide between business and society. The continuously widening income and wealth inequality that we see in so many national economies is making this divide even larger.

At the same time, the number of employees who feel less and less connected with their work and their employers is steadily increasing—the gulf between companies and their employees is widening, and rigorous cost savings and the associated reduction of benefits are likewise opening a chasm between businesses and their customers.

The emergence of these crises and distortions is not primarily the result of inopportune economic constellations; the causes lie deeper, in traditional economic thinking and acting itself: the dogma of the standard and mainstream theory of economics, that maximizing one's own (short-term) benefit or profit leads to the greatest common good. This theory has proved to be untenable. To put it in its own terminology, it is inefficient.

Outlines of a New Enterprise Philosophy and Culture

This book does not merely criticize these issues but attempts to open the door to a new approach to economic thinking and acting on a theoretical and practical level. The central points of departure are corporate philosophy and culture: they constitute the link between employees and companies on the one hand and between companies, customers, and both society and the natural environment on the other.

As empirical research demonstrates ever more clearly, corporate culture is a highly relevant independent factor in the performance and robustness of a company, yet many education curricula still do not afford it nearly its rightful role. This is because there is a myriad of methods to identify corporate culture and correlate it directly with a company's success. However, many of these approaches are merely descriptive and are not very helpful. Statistical correlations between certain types of corporate cultures and the company's success do not say anything specific about the real reasons for this connection, and it is therefore difficult to develop and sustain a high-performance corporate culture based on these approaches. Best practice comparisons and external benchmarking in the field of corporate culture are of no real help, either.

Back to Fundamentals—Looking for a New Motivation Theory

That is why this book starts with the most fundamental approach: it establishes and develops the concept of a meaning- and performance-centered philosophy and culture, firstly out of the company's purpose to provide services and secondly out of humanity's basic needs—in other words, our existential needs. These will be examined in the context of philosophical anthropology, meaning-oriented psychology, and neuro-and evolutionary biology. The first existential need that we will consider is man's desire for meaning—that fundamental desire that we humans have for insight into the meaning of our actions and our functions. The second is our need for recognition as human beings; this is the source of our individual identity and the sense that we have a place in life, that our existence has meaning—meaning as opposed to futility.

These needs are this fundamental because they are the basic attributes that raise humans to the status of human beings—they constitute our humanity. Our will and our power to mobilize our resources are strongest when these needs are fed. If you require people to perform, you have to offer them opportunities to experience meaning and recognition in return.

From Motivation Theory to Enterprise Philosophy and Culture

The next question that needs to be answered is, how should a corporate philosophy and culture be designed in order to fulfill these existential needs, thus in turn providing the company with a strong potential for performance? The core idea is this: research shows that, according to key indicators, companies that consistently serve their clients and society above all else are, in the long run, six to nine times more profitable than companies that subordinate everything else to short-term self-interest or profit maximization. This has nothing to do with romantic notions of business—there are good reasons why this is so.

From Philosophy and Culture to High-Enterprise Performance and Lasting Success

The first and most important reason is that companies that primarily focus on serving customers and society—thereby fulfilling a purpose instead of merely pursuing an end in itself—become rich sources of meaning and appreciation for their employees. Their employees feel that they are doing some good to somebody or something through the work they perform for their company—in other words, that they are making a meaningful contribution. At the same time, they anticipate the appreciation that goes hand in hand with this. Their potential and willingness to perform are correspondingly high, and this spills over into the company's performance potential—"my goals, your goals, the company's goals are finally one and the same!"(Gertrud Höhler).

The second important reason is that these meaning- and performance-oriented businesses have the awareness of and the motivation and understanding for how they can synergistically combine their services for their customers with a benefit to society. This can result in direct economic benefits along their entire value chain, such as a reduction in transportation and production costs, access to high-quality raw materials, healthier employees, and so on—to name but a few references to sources that give them comparative competitive advantages over companies that place short-term profit maximization above everything else. This idea of a synergistic relationship between business and society relates to the approach of creating shared value developed by Porter/Kramer.

The third main reason why businesses that place themselves first and foremost at the service of their customers and society prosper is that these companies...