By Jim Funk
What is most important in your organization? People, productivity or profits? Many people look at the 3 Ps as independent or competing priorities; but what is often misunderstood is the dynamic connection between the three.
Let’s say you believe that profits are most important. It’s true that an organization can’t exist for very long without a black bottom line and a good return for shareholders (or financial stewardship in not-for-profits and government sectors). Or, if you say that productivity is most important because without it profits will suffer, that is true as well. Productivity is certainly a key to success. But productivity doesn’t guarantee profitability or financial stewardship, because there are too many other variables involved. And high profits may only demonstrate short-term success that could change in the future.
On the other hand, giving people first place in the equation may be altruistic, but it’s also logical. People have the power to do what is required to be productive, generate a profit and manage resources effectively. That’s why people are the foundation of the three Ps. The innate human ability to think, judge and act is the only way to drive business outcomes and reach organizational goals. The variables within people are capability, capacity and motivation. Leaders must attend to all three of those variables, not only in selection, development and recognition, but in the engagement of people in the vision and what it will take to bring that vision to reality.
First and foremost, leaders must make the mission and vision clear and communicate it on a regular basis. Where are we headed and why? When leaders understand people and provide what is needed in order for them to do their best, creativity, engagement and excitement are unleashed both individually and collectively. That energy is what drives increased productivity and innovation. This spreads beyond employees and engages suppliers, partners, affiliates and others, because people want to give their best to an organization and its leaders that give their best to people. This is not simply a “quid-pro-quo;” it is a true energy that cannot be defined by a social or legal contract – and it’s powerful.
Further, customers want to do business with the organization that puts its employees first because they sense and experience what it means to be treated as a person. This in turn increases market share and company profitability. In the not-for-profit and government sectors it increases effectiveness, efficiency and good stewardship of available resources. This is not to say that a sound business plan, strong fiscal management and the market forces of supply and demand don’t play an important part in productivity and profitability – that’s a given. But keeping the person in the center of the business or organization is just as conscious a choice, and is what makes the real difference to both productivity and profits.
Please share any comments, reactions or questions you have about these ideas. If you believe you are working or have worked in an organization with leaders like those I am describing, I invite you to write about it in a reply to this blog or contact me directly. I would like to talk with you. In my next blog post we will look more closely at what people need to be at their best.
Jim Funk is a consultant who helps leaders, teams and organizations discover and develop their full potential. He is passionate in believing that strong leadership competence combined with the leader’s personal characteristics, values and virtues are key to achieving goals and driving business results. In addition to his work at J L Funk & Associates, Jim has served on various boards and commissions, and is currently a member of the Economy of Communion in North America Commission. Learn more about Jim’s work at www.jlfunk.com and www.linkedin.com/in/jlfunk or e-mail him at firstname.lastname@example.org.
This is the first of a series of blogs I am writing about what makes people, teams and organizations successful, based on my experiences with clients and my years of working in leadership, organizational development and human resources. I am eager to share what I have learned about successful leaders, and how they got to be the way they are.
My first premise is that people are the heart and soul of any organization. When the person is kept at the center, every single decision that is made considers how people are impacted and whether people, teams and the organization will flourish as a result. There are many mission statements and lists of core values that include a focus on people, customers and service. Isn’t that the same thing as having the person at the center? Well, mission statements and core values are only words. They might represent an intention, or how an organization wants to be viewed by others. But whether the person is truly at the center of the business depends primarily on one thing: the leader’s understanding of people, and what people need in order to be at their best. And when leaders invest in people and their development, ahead of productivity and profits, it actually leads to increased productivity, higher profits, and personal and organizational success.
People have an innate desire and need to develop their human potential, to flourish, and to become who they were made to be. Person-centered organizations not only focus on the customer, but they encourage leaders, employees, associates, partners and suppliers to reach their potential and find meaning in their work. When leaders recognize the gifts and potential in others, and encourage them to fully develop and unleash those gifts, people thrive. People engage.
In addition, the products and services of person-centered organizations serve the common good – because it is good for people. Profit is seen as a means to this end rather than an end in itself. When profit is at the center, people are disposed of when they do not contribute significantly enough to profits, or when they do not meet expectations that may actually be unrealistic. This is not to say that employees, suppliers and partners should not be held accountable for meeting or exceeding expectations. But what is key in the person-centered organization is that people know the expectations and can meet them because they are clearly articulated, well-communicated and achievable. People can connect what they do to the organization’s mission, vision and goals. They have the clarity, support, development opportunities, trust and the desire to pull their weight and contribute. It’s a win-win for people, teams and organizations.
Please share any comments, reactions or questions you have about these ideas. If you believe you are working or have worked in a person-centered organization, I invite you to write about it in a reply to this blog or contact me directly. I would like to talk with you. In my next blog post we will look more closely at the connection between the Three P’s: People – Productivity – Profits.
Jim Funk is a leadership and organizational consultant who works to help leaders, teams and organizations discover and develop their full potential. He believes that strong leadership competence combined with the leader’s personal characteristics, values and virtues are key to achieving goals and reaching desired outcomes. In addition to his portfolio of consulting assignments Jim has served on various boards and commissions, and is currently a member of the Economy of Communion in North America Commission. He provides workshops for leaders and is a guest speaker for groups and organizations. Learn more about Jim’s work at www.jlfunk.com and www.linkedin.com/in/jlfunk or e-mail him at email@example.com.