Business Metrics Evolve to Reflect the Need For Meaning
February 9, 2011 Leave a comment
Traditional Metrics Focus on Financial Gains
Traditional metrics have often focused on financial gains to measure success or return on investment. Focusing on financial gains as the desired end result of a business venture creates the impression that profits are more important than the overall impact of the business project. But are profits more important than ethics? A profitability focus makes it more likely that leaders and employees will justify unethical actions as the “right” actions because they lead to higher profits for the business.
Measurement is Evolving to Reflect the Need for Meaning
Today’s global marketplace and complex work life require employers to fully engage employees at all levels in order to compete. Employees are seeking meaningful work and want to work for responsible businesses. At the same time that the search for meaningful work and the push for ethical business leadership are heating up, there is a related movement toward meaning-focused metrics. Newer broader metrics that measure individual and collective meaning and growth are gaining popularity as an alternative to narrow profitability and income measures.
Movement From Profit-Focused Metrics to Meaning Focused Metrics
Profit-Focused Measure → Meaning-Focused Measure
Return on Investment Return on Life, Return on Culture
Gross National Product Happy Planet Index
The ways that we think, act and lead when we focus on creating profits and generating income is very different from how we think, act and lead when our focus is on creating meaning for those we serve.
Wanted: Chief Meaning Officer by Tim Leberecht, Designmind.frogdesign.com
The Meaning Organization by Umair Haque Designmind.frogdesign.com
Free Book: The 6 New Management Imperatives by Bruce Temkin, Temkin Group
The Happy Planet Index HappyPlanetIndex.org
Questions for Business Leaders
1. How can we adapt and broaden our measurements to include more of what matters?
2. How can we engage employees in that process?
3. How will the process of adapting what we measure help us improve how we engage and serve our customers?
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