03/08/2009 05:12 am ET Updated Dec 06, 2017

Companies, Like Countries, Need to Know What They Stand For

According to the New York Times, bankers are sulking because their reputations are in tatters and they aren't making the money they're used to. Ken Miller, a former vice chairman at Credit Suisse First Boston, said "this is a terrible way to make a living -- except for the money." Actually Mr Miller, the money isn't enough. Not for most sane people and not for strong, credible businesses. Most human beings don't work only for money but to make their lives meaningful. A working life is 100,000 hours -- time that, once spent, can never be regained. And particularly in America, there's a serious and growing demand that work deliver a sense of contributing to something larger than oneself. Why? The economists and psychologists studying human happiness know: happy people aren't among the best paid, thinnest or best looking. They're people who want their irreplaceable time and labor to go into building something that matters more, and lasts longer, than themselves.

Perhaps bankers were too busy with what Mr Miller calls "the hours, the sucking up" to read books. But now they have some time on their hands, they'd do well to read Roy Spence's book, It"s Not What You Sell, It's What You Stand For. 2009-02-04-spence2l10.jpg Spence has spent a lifetime working with real companies (SouthWest Airlines, John Deere, BMW) and real organizations (AARP, ACE) to define and strengthen their sense of purpose. This isn't about bromidic mission statements. Purpose, as Spence defines it, is about the difference a company makes to the world in which it operates. What I love about his thinking is that from the outset he takes it for granted that, because businesses operate in the world, they necessarily have a relationship with it that must be taken seriously. In other words, they don't live in a self-certifying bubble of quant theory, but out there with the rest of us. Great leaders define what their relationship with the world is going to be. That can (and, Spence argues, does) make them more profitable. But they believe first and profitability follows.

Like most things, if you're deliberate and thoughtful about something, you do it better. So the companies that keep working hard at their sense of purpose, thinking about what their business means to employees, customers and citizens, attract a different quality of person with the level of commitment that companies need today to get them through tough times. Fundamentally what Spence is doing is thinking of businesses as communities that are responsible for everything and everyone they touch. He takes us right away from the business-as-a-machine paradigm, run by quants according the algorithms that work until they don't. And he demolishes the spurious division between social enterprises and anti-social enterprises. As we are learning at such high cost, no business is an island. Companies without a purpose that improves peoples' lives and contributes to the greater good, says Spence, will struggle. (He's way too nice to say they're toast.)

Company leaders dismiss this thinking at their peril. Not just because Spence is one of the people who always seems to have his finger on the pulse. And not just because the companies he's worked with have achieved such staggering results -- in varying economic climates. But now, more than ever, leaders need coherent thinking to guide value-driven decisions that aren't driven by panic. It will be way too tempting, in the tough months ahead, to ditch purpose and meaning, with the excuse that survival is all that counts. But as Faulkner so eloquently put it, you can do more than survive. You can endure. That's what purpose-driven companies do. The businesses that endure the current crisis will do so not because they have money in the bank but because they have purpose in their hearts and coherence in their actions. They won't see recession as an excuse but as an opportunity to prove their worth.