One of the things I have always loved about Austin is the entrepreneurial spirit of the city. We are known for our city-wide slogan “Keep Austin Weird.” In fact, it is one of the few cities I know that not only supports but strongly embraces the concept of locally owned businesses.
One of the local businesses that I have admired since its inception is Whole Foods. Because of my on-going commitment to health and fitness I have been shopping at Whole Foods for years. They started as a small local business committed to their core values of “selling the highest-quality natural and organic products available.”
I admired John Mackey from afar throughout the years and wondered how he mobilized his organization to be innovative, profitable and continue to grow while staying true to their core values and company philosophy. It has been a while since his book Conscious Capitalism came out but I think it is one of the best books for using core values to build a business.
The book provides an in-depth look into how to run a successful business and provides a history, and a new narrative, that I believe is critically important for all business people to learn and adopt. Mackey explains the evolution of capitalism – how capitalism came to be viewed negatively by society and how as business people we must adopt a new philosophy – Conscious Capitalism.
According to Mackey, free-enterprise capitalism is the greatest system for innovation and social cooperation that has ever existed. “In a mere 200 years, business and capitalism have transformed the face of the planet.” If this is the case, then why has capitalism come to be perceived negatively?
From Mackey’s point of view there are several reasons:
1. Business people have allowed the media and economists to focus on an inaccurate and narrow narrative.
2. Businesses have operated at a low level of consciousness with little thought about the higher purpose or the impact on the world.
3. Media and academics have focused on the myth that all capitalists care about is money.
4. The size of the government has drastically expanded and has become ripe for “crony capitalism.”
Adam Smith the founder of modern capitalism believed there were two principles of capitalism. One of the principles was to maximize profit. The second principle was the desire and need to care for others and for ideals|causes that transcend one’s self-interest. What is missing in the current narrative is what I consider the heart of the matter – it is missing the principle that businesses are created to need and care for others. Further, classical economists have claimed that maximizing profits was the only goal for the business.
However, what I find when I ask business owners and entrepreneurs why they started their business, very few if any of them ever say that it is because of the money. Yes, they want to make money, but that is not the primary driver. Most entrepreneurs I talk to start their businesses because they are inspired to do something that helps others.
As I read the book, I wondered what to do to change the warped sense the masses have about capitalism. First, we must embrace a more complex definition of capitalism. It starts with creating value – for our customers, our agents, our staff and anyone that is part of our team including vendors and strategic partners. To create this kind of value means that we have to have a larger vision for why and how we do business.
This requires reinvention which starts with a new narrative and definition. In this case, I believe we should adopt what Mackey calls Conscious Capitalism as our own narrative for life and business.
Let’s examine what this philosophy means. “Conscious Capitalism” is a way of thinking about business that is more conscious of its higher purpose, its impact on the world, and the relationships it has with its various stakeholders. It reflects a deeper consciousness about why businesses exist and how they can create more value.”
The book describes 4 foundational tenets:
1. Higher Purpose
2. Stakeholder integration
3. Conscious Leadership
4. Conscious Culture and Management
Let’s explore what each of these means and how we can use them in the real estate business.
First, higher purpose means the reason “why” a company exists and the difference you want to make on the world. To find your higher purpose you can start by answering the following:
- Why does your company exist?
- What is the broader positive impact that you want to have on the world?
- How do you want to engage customers, staff, and vendors?
- How do you foster creativity, innovation, and organizational commitment?
- What core values do you embrace and live by? What do you stand for?
The second tenet stakeholder integration means recognizing how what you do affects all the Stakeholders. Stakeholders are anyone that is impacted by your business. Integration starts by first identifying the stakeholders and why they are important. Once they are identified then you can optimize their value by connecting them to your higher purpose and core values. Conscious businesses use their core values to manage conflict, make decisions and create solutions that provide harmony among all of those who have a stake in your business.
Once you have defined your higher purpose and integrated all stakeholders then you need to foster Conscious Leadership – the third tenet. Conscious Leadership means leaders are motivated by the higher purpose and are attached to creating value for all. This is a learned skill and requires high levels of analytical, emotional and spiritual intelligence. The Conscious Leader understands the interdependent nature of all of the stakeholders and thinks in ways that transcend the limitations of the analytical mind.
Historically, leadership was modeled on the military which is why many companies adopted a command and control style. This military style leadership model turned business into what can be viewed as warfare – companies led by CEO’s being paid exorbitant salaries and large stock options which incentivized them to become personally wealthy by increasing the stock price of the company.
This is the exact opposite of a Conscious Leader. Conscious leaders are emotionally and spiritually mature, they possess exceptional moral courage and are able to withstand scrutiny and criticism from those who view business from a more traditional and narrow vision.
How do you know if you are a Conscious Leader?
Following are some of the questions to ask to determine if you are a Conscious Leader:
1. Do you consider yourself a servant leader?
2. Do you have a great capacity to care and love?
3. Are you authentic? Do you know your life’s purpose?
4. Are you described as empathetic? Do people say you understand them?
5. Do you do the right thing even when it is hard?
6. Do you have an uncanny sense when things are beginning to go off track?
7. Do you anticipate immediate and long term consequences of your actions?
8. Do you feel the interconnectedness of systems?
9. Do you have a passion for making the world a better place?
10. Are you willing to shoulder the responsibility of not maintaining the stays quo?
If you answered these questions and feel like you need more work, Mackey recommends the following:
1. Discover your own higher life purpose.
2. Quiet your mind so you can listen to your heart.
3. Learn to deal with fear
4. Find a good coach or mentor
6. Cultivate your higher virtues
7. Develop your emotional intelligence
8. Develop your systems intelligence
9. Continue to learn and grow –
10. Take care of your physical health
As you become more conscious, you will become a catalyst for creating and refining the fourth tenet – Conscious Culture and Management.
Culture is derived from the company’s higher purpose, core values, integrated stakeholders and conscious leadership.
Shaping culture is one of the leader’s most important jobs. Some of the cultural traits of conscious businesses are TACTILE: Trust, Accountability, Caring, Transparency, Integrity, Loyalty, Egalitarianism
With this vision, I quickly realized that I had to surround myself with people who had the same philosophy and would help me build a great organization. Our higher purpose and core values have evolved as the vision evolves but having a written vision and values guides our most important decisions.
If I had to give anyone advice, I would say that step one is to work on your philosophy and consciousness. Assess yourself first and determine the areas in which you wish to evolve. As you evolve, so will your company and those around you.
Next, identify your higher purpose. Then create your core values.
The final step is to act as a Conscious Leader and be the catalyst for building a powerful culture that will last. This starts with asking the questions outlined earlier and then seeking to grow and learn every day. Remember it is a journey – each day starts with choosing conscious awareness for you and your business.
I believe that the adoption of the Conscious Capitalism philosophy coupled with the daily practice of Conscious Leadership means you are on your path to building a great business while living a great life.
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