Earlier this week Rens and I gave a keynote presentation on rational optimism atDare Festival. Dare Festival is a playground that explores how human behaviour and technology can shape and reinvent organisations. It was aired on TV-show De Afspraak on Canvas, the fun starts at 22’00” (video in Dutch)! We were happy to join and shared some evidence based insights on happiness and performance, on nature and nurture, on cause and effect. You can check the facts and the slides here, for an in-depth scrutiny you can download the book Building Positive Organisations.
After the coffeebreak we zoomed out. From individual happiness over organisation performance to the world. How is the world doing? Is there any reason to be optimistic about living today? Are we doing any better the last couple of decades? And do we have a clear understanding of better? The answer is a clearyes. Up to date statistics show recent global progress is ‘maybe the greatest in our time, possibly the greatest story in all of human history’. Savour the stats and let famous statiscian Hans Rosling make the story stick in this BBC-documentary on how to eradicate extreme poverty by 2030.
Rosling states we suffer from a devastating ignorance when it comes to a fact-based worldview. There is a lot of stuff we don’t know. And many of these things are trivial to know, so why bother? But some facts are more important than others. Some ignorance can be devastating, it can lead to wrong decision making. Rosling blames both media with their agenda-setting power and our education system that’s using outdated facts and information about the state of the world. Besides these institutional flaws we also see a tendency on an individual level that makes us prone to a pessimistic perception of the world. Psychologists know these effects as cognitive biases, distorted views or perceptions of reality. It seems like we have very strong psychological happiness blockers, we sabotage our own happiness because of our quick but dirty heuristics that very often lead to wrong conclusions about reality. There is a long list of biases, we touched some of them in the workshop: loss aversion bias (we prefer to avoid losses to acquiring gains), negativity bias (negative things have a greater effect on our mental state than neutral or positive things), confirmation bias (we search for information that confirms our beliefs) and its derived ‘Texas sharpshooter fallacy’ (hilarious ànd instructive video).
So if cognitive biases shape our experiences and perceptions of reality more to the negative, what can we do about it? Can we make use of these insights? Can we design and practise exercises to reframe and become happier? Can we bend our experiences here and now and even our experiences from the past? Sheldon and Lyubomirsky’s advice is simple: change your actions, not your circumstances. And that’s what we did in the workshop, we reframed memories by reliving peak experiences, we reframed how we give feedback to people, we reframed how we express gratitude to our loved ones, … But yes, circumstances do help a bit, we had a beautiful sunny day with a scenic view!
All these exercises or intervention techniques focussed on abundance, not scarcity. To achieve sustainable happiness and because willpower is a limited resource, ritualisation or habit formation helps to make it stick.
Organisations for positive impact
Let’s zoom out again from sustainable happiness on an individual level to sustainable well-being on our planet. How can we have a positive impact on the world? One of the main catalysts for positive impact, change and global progress are organisations. Organisations are designed and developed to deliver value or achieve a goal in the most efficient way. But what is value? And what are valuable goals? Many research and publications focus heavily on financial parameters to assess performance and success. A typical research set-up is to look at financial performance and work backward and seek for causes why these companies outperform their competition on financial measures. One of the world best-selling books in this field has been ‘From good to great’ from Jim Collins. I won’t dive into the (contested) methodology being used in this book, but I do like to compare its interpretation of value with the interpretation of value by the researchers from ‘Firms of Endearment’. In the Good to Great logic you are doing great if you maximize return for shareholders over a given period. As a Firm of Endearment you are doing great if you make the world a better place because you exist. This is not about corporate social responsibility. This is about maximizing the value to society as a whole, not just to shareholders. This is about creating emotional, experiential, social and financial value from the start. This is about purpose. These companies are doing well, while doing good. What’s interesting is the performance of these Firms of Endearment versus Good to Great companies: the Firms of Endearment have out performed the S&P 500 by 14 times and Good to Great Companies by 6 times over a period of 15 years.
“The Firms of Endearment have out performed the S&P 500 by 14 times and Good to Great Companies by 6 times over a period of 15 years."
It seems like we have a winner, don’t we? Or should I rephrase it and say we can be all winners in this game? There is many research like this and I’ve also experienced it myself that business owners, CEO’s and their boards are not only more open to broaden their perspective but also have the moral intention to put purpose back in the heart of their value chain. But still, based on the sheer number of copies sold, Good to Great wins hands down and the current dominant paradigm on business still favours a myopic and one-dimensional financial view. So maybe we have touched upon another devastating ignorance?
I believe we need firms of endearment who not only move from good to great but from great to flourishing.