Hello all!

It has been just over a year since I’ve posted a blog. Much has changed, including the election of a new president, Barack Obama, just days ago.

In August of 2007 I closed the office in Boulder and moved back to my condo in downtown Dallas. My girlfriend was finishing her final clinical rotation for her doctorate in physical therapy in the Dallas area. While she was finishing up I spent five months in Pennsylvania reorganizing Brian Robertson’s software company while he took a much needed sabbatical. We did good work at Ternary Software and met Brian’s goals of getting him out of the driver’s seat and replacing himself as CEO. He is now focusing on Holacracy.

I then took some time off for reading, reflection and travel. We spent the summer touring Europe which was delightful, but all the while I continued to ask the question what is a good business? What does it mean to “do good?” I believe I have some answers and in the coming months expect to see this website updated towards discussing that topic. I’ll return to posting regular Monday blog in January of 2009.

Today I am driving to Austin to participate in the first Catalyzing Conscious Capitalism conference hosted by John Mackey at Whole Foods. You may remember that I was gushing admiration for Mr. Mackey in my blog of May of 2007 . The event has the potential to be a major step forward in redefining how business is conducted in the United States and beyond. I am enthusiastic but will also be bringing a dose of skepticism.

During the last two years I’ve search for individuals that lead their businesses from a place of consciousness and love of their fellow man. I’ve looked in big businesses and small business. I’ve met some wonderful people that walk the talk in positions all the way up and down the corporate ladder. I’ve also met individuals that profess the spirit of conscious capitalism but do so either consciously or unconsciously to mask their deep greed. Just like ‘green washing’ there are those that use the language but lack the spirit. Let’s work together to find those leaders that lead with integrity and learn from them the techniques to run ‘good’ businesses. I’ll do my part by posting what I find here.

A change is coming. The Spirit of mankind is awakening to a new day of interdependence in business and society.

I seek happiness for myself and attempt to assist others in finding their own. I’ve read about it voraciously and own just about every book with the word ‘happiness’ in the title. This turns out to be a lot of books because happiness is in vogue these days. It’s moved beyond just psychologists and self-help gurus writing books on the subject; now even economists are investigating how we pursue happiness and the choices we make in the process. In his book, Happiness: Lessons from a New Science, Richard Layard whom is one of Britain’s best-known economists, teaches that most of us make choices based on social comparison and habituation. Meaning, but we not only try to keep up with the Jones, we want to be a little bit ahead of them and avoid boredom in the process.

A few months back I did an experiment with my staff (with them, not on them, as they knew it was an experiment). At that time each staff member was making less than $50,000 a year. I asked if raising their salaries to $120,000 for the same work they were doing sounded good. They all wholeheartedly agreed that would be a good idea and that they would be satisfied at that salary level for many years. I then told them that I was simultaneously going to raise my own salary to $1.2 million a year, at which point they began to question the whole deal.

This little experiment highlights how social comparison affects our choices. The staff was all offered the same amount of salary, so they had no immediate cause to reject my offer based on comparing each other’s salary. I believe that if I would have offered half the room $120K and the other half $130K there would have been tension. Additionally, their acceptance of the offer was based on the underlying, and erroneous, belief that more money would make them happier. Study after study has shown that once an individual’s income is high enough to cover basic needs, that more money does not bring more happiness. Finally, the whole deal soured when they learned that I would eventually be making millions! Like most of us they evaluated their value, and probably mine, relative to the dollars being paid.

Some of my client companies have a transparent salary structure. The intention is to promote a team environment through open communication. I support the general concept but find myself skeptical of the efficacy of such systems for the two reasons; both of which Layard points out in his book: social comparison and habituation. Employees that might otherwise be satisfied with their salaries may be more or less satisfied given their relative income to other employees. Additionally, when an employee sees that another staff member’s salary has increased they tend to be less satisfied with their own salary, not just through comparison, but through habituation. Simply put, they are bored with their current salary. (and yes, I know that salary comparisons have been going on at water coolers since…before there were water coolers)

A few years back I worked at a technology company, Atrana Solutions, that I founded with some friends. There we recognized employee contributions by having a founding executive deliver a hand-written note inclusive of a $100 bill to the employee, as thanks for service. We found that the inclusion of the $100 was better received than a card without the $100 bill (this was by no means a scientific study). Now while the money would represent a .17% one-time income bump for a $60,000 employee, it seems to have a major impact on the team member’s moral. Over time we found that these little bonuses had more impact on employee satisfaction than larger bonuses or even raises in many cases.

The lesson? Compensation planning is complicated and is directly related directly to how individuals make choices and what makes them happy. The matter gets further complicated when we realize that people with different values or levels of development assess their relative situation and habituation differently. My advice is to heed what I learned from someone else a while back, “don’t throw money at people.” Money is a motivator, but it is actually a weak tool. Recognition, work conditions, camaraderie, leisure, and personal development can all be offered to employees to assist them in finding happiness (you can also call it satisfaction or fulfillment) at work.

This is a long blog, but I urge you to read the whole thing. – Steve

My vision of MANAGEMENT BY HAPPINESS continues to develop. While theoretically the concept of valuing a business by the well-being it brings into the world feels right, there are still some execution obstacles including the realities of financial statements. Accounting practices are well defined and generally accepted, but little exists in terms of standardized measurements and reporting structures for sustainability and well-being. As a consultant, my activities seem to always come back to a dollar discussion. I’ve had an instinct of late that our culture is unnaturally focused on money. My friend Dick Wagner says, “money is the most powerful and pervasive secular force on the planet.” Lynne Twist asks us to notice that while we once identified ourselves as citizens of this great nation, we now call each other “consumers.” What’s going on with this? How did money come to have such a powerful influence on our culture and selves? Recently I stumbled upon a possible answer from Bernard Lietaer that led to one of the biggest ‘ah ha’ moments in my life.

I’ve heard Bernard lecture a few times at Naropa and I am reading a pre-publication copy of his new book: Of Human Wealth. (Bernard Lietaer & Stephen Belgin. 2006. Of Human Wealth: New Money for a New World. Pre-publication Edition Version 4.1. Citerra Press. Boulder, CO, USA.) In this new book, his previous book(The Future of Money), and in interviews, Professor Lietaer outlines how he believes that our money system shapes our behaviors. He states in an interview:

“While economic textbooks claim that people and corporations are competing for markets and resources, I claim that in reality they are competing for money – using markets and resources to do so.”

Or as he states elsewhere in this article:

“The monetary system is programmed — albeit not deliberately — to cause certain behavior. It promotes competition and short-term thinking; it forces economic growth; and it undervalues care, education and tasks crucial to maintaining a society. Economics theory teaches us that people compete for markets and raw materials; I think, in reality, people compete for money.”

We must then ask ourselves why people and businesses compete for money. The root cause seems to be the interest component of our money system. The dollar is designed in such a way that there just isn’t enough to go around. In another article Lietaer says:

“Interest on money constitutes one of the most systematic causes of our destruction of the global environment. Consider as metaphor, for example, the life of a tree (or any other living resource): Because of interest, the net present value of any income far away in the future is negligible. So, it literally pays to cut down a tree and put the proceeds in a savings account instead of letting it grow for another decade or century.”

While my undergraduate degree is in Economics and Finance, I didn’t really understand until just recently how interest causes scarcity. Consider this simplistic example: when the Fed puts $1000 into the money system. Those dollars can be put on deposit at Bank A. Bank A is then allowed to loan out $900 (assuming a 10% reserve rate) that end up on deposit at Bank B, which can then loan out $810, and so on and so on. Most of us have been taught that the expansion of the money supply comes from the fact that banks can make loans. In this example the original $1000 the Fed put into the system results in approximately $10,000 in the money supply, all of which is based on loans that are charged interest. The total to be paid back across the system is in excess of $10,000, so in total there literally isn’t enough to pay back all the loans and thus money becomes a scare resource. We are all competing for money because of the way it is designed. This competition causes people and corporations to constantly be inventing new ways to lure money away from others and to hoard it.

Could it be that our collective unconscious is keenly aware that we have created an economic system that pits us against each other every day? What maladies might be attributed to this constant pressure to compete? Over-consumption, over-eating, the unequal distribution of wealth, and maybe even mental illness? The good news is that it doesn’t have to be this way, which I’ll be posting on in the near future.

For now let’s close with another quote from Bernard Lietaer:

“My conclusion is that greed and the competitive drive are not inherent human qualities. They are continuously stimulated by the kind of money we use. There is more than enough food and work for everyone. There is merely a scarcity of money.”

Let’s do a thought experiment. Imagine a white board that is divided into two columns. The heading of the left column is titled cataclysm and lists potential world-wide catastrophes like global warming, species eradication, health care crisis, meteor impact, peak oil, Ebola etc. Usually when I do this exercise with a group they quickly list twelve or more natural and human caused disasters. Now, in the right hand column of this imaginary white board we are going to create the opposite list. What would you title this column? Don’t feel bad if you can’t immediately think of a word, most people can’t. As a culture we seem to have a constant underlying angst about disaster, but we are weak on holding energy towards massive optimism. Let me help.

We could label the right column “godsend” or “miracle”, but both these terms suggest that there is a supernatural being that is granting, or withholding, these glorious outcomes. We could use the heading “boon” or “fortune”, but these words seem to relate more toward financial riches than the awe of a global windfall. I’m sure there is a perfect word out there, maybe in Sanskrit, but for now I suggest: “wonderment”.

Naming the right side column is the easy part, the hard part seems to be listing ten or more positive world changing events? Take a moment and see how well you can do. For most people creating this second tally is difficult, if not impossible. If we truly co-create our reality through our thoughts, then we might try thinking more positive thoughts on a big scale. I was inspired to produce this thought experiment after regularly meeting with some of the most brilliant and conscious minds on the planet. In those meetings I was surprised to find that most of these thought leaders seemed to have an underlying apocalyptic mindset. Could it be that as a culture we believe that imagining the worst can somehow steel us for misfortune and that dreaming too big will just cause us to have our hearts broken. How’s that working for us so far? Here’s a list of some miracles I thought up:

Top 10 World Changing Wonderments

1. Cheap, clean, unlimited and massive energy source discovered
2. Cure for some or all illnesses including AIDS, cancer and mental illness
3. Instantaneous travel through space and/or time
4. Undeniable proof of higher order compassionate beings
5. Outbreak of global non-violence
6. Verification that thought directly impacts the physical world
7. Unrestricted and limitless food and water access for all
8. Biodiversity as an unintentional consequence of human existence
9. Intelligent communication with other species
10. Free, ubiquitous and immediate access for all to the Internet

How does that list sit with you? Does it seem like science fiction, religious nonsense and New Age drivel? Do you find yourself more inclined to embrace the possibility of global horrors than astonishing good fortunes? My point is that many of the businesses I interact with are trying to make the world a better place and I applaud that, but many also come from a deeper mindset of global despair. Yes, we can do a much better job of taking care of each other and the planet, but let’s do so from a place of optimism. The power of positive psychology, goal setting, and visioning has recently been deeply explored in the areas of personal transformation. We’ve yet to see these tools used for business or culture at large; maybe it’s time! Change the world and change your business by first changing your mind. Blessings!

Donald Trump and Robert Kiyosaki want you to be rich. Let’s all get rich! Isn’t that why we are in business? Let’s all make a big pile of money so we can, so we can, so we can….what? Then what? Of the four P’s: people, profit, purpose and planet, I think profit should follow the other three, though I personally still find myself sometimes joining the lemmings march toward riches and the dream of “someday”.

Are you in business to get rich? If so, you may be reading the wrong blog. I’m interested in helping you become wealthy which is vastly different from getting rich. Getting rich is not a goal; it’s as meaningless as gassing up a car with nowhere to go. Wealth on the other hand, is comprised of both interior and exterior attributes like happiness, health, well-being, meaningful relationships, and experience in addition to financial integrity. We all know that money can’t buy happiness. Once most basic needs are met additional money does little to increase happiness. There’s a lot of buzz about about discovering what exactly does lead to longterm personal satisfaction, and that trend doesn’t seem like it’s going anywhere soon. Yet, almost nowhere do we see these ideas being applied to business. The market and most companies still focus solely on financial profit as the metric to determine the success of a company.

Could this emphasis on profit over the other three P’s be the root cause for much of the ecological and cultural destruction seen in recent years? If so, is it possible to re-frame what success means in the business world so that an organization is ranked on more that just its profits? I think so, and as a great leader once said, I believe that one of the most powerful ways to facilitate this transformation is to embody it in one’s self first.

Consequently I’m doing a personal sustainability audit. It is fair to say that my life, like my physical body, is a little soft around the middle. It is time to deal with both those issues. I plan on trading in my Lexus GX 470 for a hybrid, but until then I’m buying carbon credits for driving and flying. I’m looking at the food I eat, the stuff I buy, and of my habits and how that all relates to my happiness. More importantly, I am investigating the price that these life choices have on me, others and the planet. It is becoming obvious that I’ve been sloppy in recent years, and for that I’d like to apologize to my fellow beings. I think I’ll find that I can achieve the same level of wealth, and perhaps even more, through a smaller footprint on the planet. The same return, or greater, with a smaller investment. That’s just good math!

Now don’t get me wrong, I’m not moving into a cave and giving up good Scotch. Far from it, but I am looking into the science of both happiness and savoring, and asking questions about where there is waste in my personal and business lives. After doing some of the work for myself, I hope to assist others in doing the same so that they too might have an easier time pursuing sustainable happiness. One of my client’s slogans is “giving, it’s the new getting.” I hope those words become valued in the worlds of both individuals and businesses soon.

Money is fuel for business in the same way that gas is fuel for a car. In the end, aren’t both really about where we want to go and how we want to get there, and not about the fuel? We can use this vehicle of business to serve ourselves and our world and assist all of us in the pursuit of happiness. As Americans this is our legacy. Our founding fathers wanted us to have the freedom to pursue happiness, or what I might call The Chief Good. That is the true wealth of a nation. Somebody tell Donald to call me.

This past Memorial Day weekend my only child, my daughter, got married. In the days leading up to the wedding I tried to imagine what it might be like to escort her down the aisle. I envisioned us both dressed up as we’ve never been before with teary-eyes and racing hearts. I next tried to imagine what thoughts and feelings I would have, what exactly would be going through my head? While I found it to be incredibly powerful to do these visioning exercises, nothing could have prepared me for the actual experience; I just had to live it.

Buddhism makes heavy use of “pointing-out instructions”, descriptive processes by which a master may lead a disciple to uncover the true nature of mind. The term more casually implies that instruction can lead to experience, but is incapable of describing the experience itself. One of the primary things that changes one’s world-view is the process of having experiences, as opposed to just thinking about them. This is true of all of areas of life, including business.

The management adage of “ready, fire, aim” alludes to the value of practical experience in the world over prediction. Brian Robertson incorporates this idea into Holacracy with his emphasis on Dynamic Steering; I’ve always leveraged Nike’s brilliantly simple slogan of Just Do It. Regardless of what one calls it, the wisdom is the same and that is that nothing trumps experience. The art of good business is practicing the skills to keep moving forward and adjusting for actual experience all while staying within specific tolerances and limits that could otherwise lead you to kill or cripple your organization. Jumping off a building will certainly give you good hard data (pun intended) about the concrete below, but you won’t have much resource (life) left to put that new information to use.

When I model a business I move quickly estimating variables and using best guesses. I firmly believe the model doesn’t have to be perfect; it just has to be close. Why? Because the initial model isn’t meant to be a detailed simulation of the business, that will naturally come over time as more and more accurate data is integrated. The first implementation of the model should primarily be used to reveal the variables that have the greatest impact on the business.

All this can be summarized by the following advice: a ready, fire, aim style is great for moving quickly and avoiding analysis paralysis, but it requires that you also deeply understand the system of your business enough to avoid catastrophe and accidentally stepping off a cliff!

This past week I had the pleasure of dining with some great friends of mine: Brian Robertson, CEO of Ternary Software and father of Holacracy, Tom Thomison, CEO of Holacracy One, and my coach Jim Vollett. It was a transformative evening for me as we discussed not only the recent staffing challenges here at The Chief Good but also my daughter’s upcoming wedding next Sunday.

I’ve often said that building a business is a lot like becoming a parent, and in talking to Brian I found myself even more intrigued by this idea. Specifically, might a business be thought of as a single group consciousness that becomes its own unique entity by combining the traits of its founders? Let’s play with that idea.

Consider that a business is born of its parents, the founders. It is given the values of its parents and will inherently contain many of their mannerisms. For example, a new entity spawned from a bureaucratic culture will likely display its genetic heritage by having stringent rules and thick operations manuals that are heavy on process. Conversely, something formed by young movers and shakers might exhibit much looser and fast paced achievement based traits. Traits might also combine in unexpected ways, producing organizations that are proactive and innovative in some areas, while slower and more reactive in others.

Of course there is also the fact that organizations, like children, aren’t exclusively a product of their genetics (nature) but also of their environment and upbringing (nurture). It is the parent’s primary responsibility to keep the little ones alive and to prepare them for life in this world. What has been birthed will develop in stages and the child (conception/research) will become a teenager (development) before it moves into the phases of adulthood (stability/growth/wealth). Nurturing at each stage takes different skills. The techniques that worked in the beginning often stop working, become inappropriate, and can even cause damage that will take years to fully heal. Unhealthy relationships between the parent and the child can form (founder’s syndrome) or even worse, death (bankruptcy) may result from parents trying to raise the child without the proper resources or skills.

This all goes to suggest that before starting a venture really consider who you are getting in bed with. Will they make good parents? What traits will they pass along to the next generation? Will they stick around through thick and thin? Perhaps it might be worth dating around a bit more to find someone that truly embodies the qualities you want to see reflected in your new creation. Do your co-creators have the balance of feminine nurturing qualities and masculine direction to help grow a healthy business? Can they make it through the sleepless nights and weighty responsibility? Personally, I love being a parent and nothing in my life has brought me such bliss. Maybe that’s one of the reasons I’m so interested in birthing new businesses! Good luck with your children!

If you haven’t been following what John Mackey, CEO of Whole Foods Market, Inc. (WFMI: NASDAQ), is doing and saying about Conscious Capitalism the read this:

Conscious Capitalism: Creating a New Paradigm for Business

Also check out what he and Michael Strong are doing at FLOW.

..and what Jeff Klein is doing at Working for Good

But my admiration of Mr. Mackey isn’t solely based on his leadership in Conscious Capitalism; the fact is that I love Whole Foods.

Here’s the back story. My family is from Austin, Texas and I used to shop at Whole Foods on special occasions with my grandfather. Some days we would visit one of the stores just to browse the wonderful produce, meats, and cheese, as money was very tight back then. I remember setting a life goal to reach a level of financial freedom wherein I could shop at Whole Foods regularly. Goal achieved! Whole Foods is my grocery store of choice…but I think it is also something more. The grocery chain has become a geographic indicator of community. Where are my people? They shop at Whole Foods.

I’ve been thinking about living some place new and one of my “must haves” for a new home is access to a Whole Foods store. Not just so I can buy food, but because I expect that the market research they use to choose store locations is very similar to what I would use to find a new community. The brand is an attracter. I wonder what might happen if Whole Foods became the Welcome Wagon of the Cultural Creatives. It would be very helpful if I could pop into my new local store and get recommendations for yoga studios, housekeepers, dry cleaners, and veterinarians.

There is a longer essay to be written on values marketing and how certain brands like Whole Foods are leading the way, with the key point being that trust is critical. In a world where we are awash in a sea of information, trust relationships are becoming more and more valuable. How are you building trust with your stakeholders, employees, vendors and customers?

Notice that our tag line isn’t “the Science of Conscious Capitalism”, but rather the “the Art of…”.

I like the Wikipedia entry for art that says, “There is no general agreed-upon definition of art, since defining the boundaries of ‘art’ is subjective, but the impetus for art is often called human creativity.”

There is certainly no agreed-upon definition for Conscious Capitalism, let alone a standards and practices model. This stuff is so new we can’t even all agree what to call it! Yesterday the New York Times ran an article on for-benefit corporations…which are also called “fourth sector” companies and “B corporations”…which are related concepts to “sustainable enterprise,” “social entrepreneurship,” “conscious business,” “good business,” etc.

Here at The Chief Good, we are working on inventing some of the standards and practices for this new thing, no matter what you call it. The good news is that if you are reading this blog post and feeling both excited and confused, then you are in good company!

We envision a day soon when the most important list of companies will be the “For Benefit 100″—a list of companies that are engaging in the Art of Conscious Capitalism and helping create the practices and measurements that we can all use. If you know of companies like this drop us an email and let us know. We are starting to build the list.

Last week I met Patricia Aburdene at the launch event for the Marpa Society (a project of Naropa’s Marpa Center for Business and Economics).

Patricia was discussing her new book, Megatrends 2010: The Rise of Conscious Capitalism. In her talk and in her book she examines 7 new trends that she believes will transform how we work, live and invest. Her main point is that conscious capitalism is already profoundly transforming the way the world does business.

I came away from the talk feeling really encouraged.

It’s really easy to feel like the world is going to hell in a hand basket right now. Global warming, the war in Iraq, school shootings—it’s really easy to feel overwhelmed by all the bad stuff out there.

But as the same time, there are growing numbers of people who want the world to be a place of beauty and peace. And increasingly they are using business as their vehicle for changing the world.

In the 1960s, big business was viewed as “The Man” to be resisted and avoided at all cost. Now there is a growing sense around the world that business can be a force for change in the world. I believe that in the not too distant future, business will be considered the most powerful force for positive change on the planet.

Think about it—in 1980, there were less than 1/2 dozen natural foods supermarkets in the country. Today Whole Foods is a multi-billion company—and the big chains like Safeway are rushing to copy them. A few years ago, Zaadz was just a gleam in Brian Johnson’s eye. Today they have more than 50,000 members and are growing exponentially. Spectacular leaps forward such as these are happening every day in this country and around the world.

I think this is an extraordinary time to be alive—just as the wave of conscious business is beginning to gain momentum. And I feel like The Chief Good is at the right place at the right time to help people and businesses make the transition to this new way of thinking and being.

As an added note, I think Mark Wilding is doing a tremendous job with the Marpa Center. Be sure to check out their website for ways to plug in.