You believe that we have made a switch from the Information Economy to the Purpose Economy. Please explain.
Ironically, what the Information Economy has enabled, through technology, is a return to our more human roots, and that is what is driving the Purpose Economy. This economy is defined by the quest for people to have more purpose in their lives. It is an economy where value lies in establishing purpose for employees and customers—through serving needs greater than their own, enabling personal growth and building community.
I believe this represents the next fundamental shift in our economic history. The most exciting opportunities in the coming decade will be around finding ways to take massive and dysfunctional industries like education, health care and finance, and make them human again. Already, technology has made it possible to have a personal relationship with your doctor or to borrow money from a neighbour instead of a bank.
How are businesses reacting to this shift?
Smart companies are creating new products, services and experiences that are aligned with the values of their consumers. You can see this happening all over the place, from Seventh Generation cleaning products to Tesla's electric cars. In addition, huge businesses like Unilever and Walmart are harnessing the influence they have over their supply chain to be more ethical and to support partners that better align with their values.
Large, traditional companies like Deloitte and Pepsi have started to put their toes in the water. Their leaders recognize that while they can’t change overnight, they can develop long-term visions to make purpose a priority. Pepsi’s CEO Indra Nooyi has framed their north star as ‘performance with purpose’ and has begun to make ‘healthy eats’ and the environment core to its success. Deloitte, a consultancy with 200,000 employees around the globe, has made it a priority to embrace a culture of purpose, realizing that successful companies must be “keenly aware of the purpose they fulfill for clients, employees, community, and other groups,” and they have integrated those goals into their business’s core activities.
Even Morgan Stanley recently got into the game with its announcement of a multi-billion-dollar Institute for Sustainable Investing. More broadly, finance is slowly changing to thrive in this new economy. Several U.S. states are experimenting with social impact bonds, and others are experimenting with new governance structures to address the financing needs of organizations that don’t neatly fit into commercial or non-profit categories.
In today’s world, running an organization without an intentional emphasis on a specific purpose for your employees and customers is like running an organization in the early 1990s and failing to implement technology.
Many people fear that technology is keeping us isolated from one another; yet in the Purpose Economy, it seems technology is being used to enhance relationships.
People love their technology, but they also still want authentic relationships. They want to connect with teachers and doctors and the other important people in their lives, and not just have technology serve as a surrogate for relationships.
People of all ages are sharing much more than they ever did—and not just through updates and photos: they’re sharing spaces, from communal commercial offices to makeshift offices at their local Starbucks; and they’re sharing transportation, both public and through zipcar, or municipal bike-lending programs. Markets are packed with local farmers and artisans as well as buyers who want to connect with the people who make or supply their food and crafts. Even libraries are becoming social hubs for cultural events and public collaborations.
Describe the difference between purpose and ‘having a cause’.
Based on my experience, purpose is far more about the journey than the destination. Day-to-day living, relationships with others, doing something greater than one’s own self, and personal growth are all examples of what makes up purpose for people. A cause is something quite separate from that: it’s an interest or a passion, but you can have a cause without having purpose. Conversely, you can have purpose in your work, but have no interest in any particular cause. Purpose is found in the everyday: in conversations, in helping others, and in being present.
To proactively infuse purpose into your work and life, you first need to clearly understand what drives you. You need a mission, or better yet, a purpose statement—a short and powerful way to remember what matters that you can keep front and center in your daily life. The ‘purpose patterns’ that we’ve identified (see sidebar) provide an outline and a starting place for us to each create our own personal purpose statement. It gives you the who, the how, and the why that you can then put into your own words and hang on your literal or figurative office wall.
You believe the realm of Finance holds significant opportunities for value creation in the Purpose Economy. How so?
If you think about it, Finance today looks nothing like it did a hundred years ago. J.P. Morgan built his empire by lending money to people based on their character and community standing. Banking was a community business; this is the way finance worked for hundreds of years until the mid-20th century.
Entrepreneurs like Jeff Stewart saw an opportunity to return to the roots of finance and live up to the ideals of pioneers like J.P. Morgan. Online social networks, he figured, could enable people to borrow money based on their character and standing in the community. In founding Lenddo, he saw an opportunity to serve the two billion people around the world who are currently ‘under-banked’.
And while most of their loans are modest by Western banking standards, a $500 loan can make the difference between an education or having the ability to start a business. Lenddo now has 400,000 members across 38 countries and boasts loan rates that are the same or lower than traditional lenders.
If social lending continues to grow at current rates, consumer and small business lending will in the near future look more like Facebook than Citibank, and will be transacted on phones. And as banking laws change, we are likely to see finance become the core revenue generation strategy of social media companies. The future of personal and small business finance is social.
You have said that the Millennial generation, in particular, has embraced purpose. What are the implications of this?
The Millennial generation—those aged between 15 and 35—is increasingly being referred to as ‘the purpose generation’. Studies indicate that 84 per cent of them are seeking purposeful work, and by 2025, they will represent 75 per cent of the workforce. As a result, attracting and engaging and retaining this talent will increasingly require meeting their need for purpose. Managers and leaders need to see the creation of purpose for members of their team as something that they can help facilitate.
It all begins with helping people build self-awareness. We need to continue to move away from a command-and-control leadership model and towards something more akin to ‘community organizing’—a model well understood in the NGO sector. Community organizing is focused on achieving shared goals, and the main role of leaders is to create a culture of purpose.
What is your advice for those who want to get started on the road to purpose?
The biggest opportunities lay in finding ways to reconnect within your community. There are industries where massive intermediaries have come between us, providing opportunities for people to create new models, or to ’dis-intermediate’. I would advise people to take any industry and examine where and how intermediaries are getting in the way of relationships and real human connections. If you can find ways to solve those issues, you will find success.
We’ve created a website: purposeeconomy.com with a diagnostic tool that has been very successful in helping people become more self-aware. Once you have that self-awareness, then it’s a question of ’job tailoring’. Going forward, instead of grabbing a job ’off the rack’, you need to ’tailor it’ to fit what actually drives you and creates purpose for you. It is the responsibility of each individual to build up these skills, and I’m hoping that business schools, among others, will soon start to teach it.
Can the Purpose Economy solve the world’s wicked problems?
It won’t solve them, but it will help us build up our problem-solving muscles. Make no mistake, in the next 50 years or so, climate change and overpopulation are going to radically rock our world. In that sense, the Purpose Economy is like a warm up: it will help to train us so that we actually have a chance to find solutions to some of these global issues.
Globally-recognized entrepreneur Aaron Hurst is the CEO of Imperative, a technology platform that enables people to discover, connect and act on what gives them purpose in their work. He is the author of The Purpose Economy: How Your Desire for Impact, Personal Growth and Community Is Changing the World (Elevate, 2014). A regular blogger for the Huffington Post, Stanford Social Innovation Review and LinkedIn, Aaron is a member of the Nonprofit Times’ Power & Influence Top 50, and has been recognized as a top social entrepreneur by Fast Company and Ashoka.
10 Drivers of the Purpose Economy
1. Human-scale technology. Technology has evolved over the last ten years from enabling us to move online to now enabling us to find purpose online.
2. The Millennial Effect. While many generations have sought out purpose, Millennials make it a greater priority than ever before, in everything from their consumption to their work to their communities to their relationships.
3. Generation Disrupt. Generation X entered the workforce during the dot-com boom and were trained to think big and use technology. They are now the generation in charge and are putting those talents to practice working on big purpose.
4. Environmental, economic and political turmoil. The growing uncertainty in our society is moving people to find stability within themselves and to see a need to develop empathy for those affected by turmoil.
5. Longevity. As they map out their next 30 years, Boomers are designing their second careers and again prioritizing the purpose they sought in their youth. In the process, they inspire the rest of us.
6. Changing families and evolving roles. Both parents in most families now work, and one of the many consequences of this change is that we are hiring people in record numbers for the jobs highest in purpose—caring for our kids and aging parents.
7. New Social Science. The new field of Positive Psychology has dispelled many of them myths about success and purpose and is changing the way leaders think.
8. Accelerated globalization. The world has become a smaller place, and we are inspired by the potential and challenges it holds.
9. A shifting social context. Organizations and individuals are seeing the gap in what the government can accomplish and trying to step in to fill it.
10. Blending of the sectors. The line between governments, non-profit and companies is blurring, and every sector is seeing purpose at the core of their future.
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[This article has been reprinted, with permission, from Rotman Management, the magazine of the University of Toronto's Rotman School of Management]