The Purpose Economy

Highlights from The Purpose Economy by Aaron Hurst

      “It’s not only what you are doing, but how you do it and thereby relate to the world.” 

·        What is the Purpose Economy?

o   Describes the new context and set of ways in which people and organizations are focused on creating value, and it defines the organizing principle for innovation and growth

·        3 Types of Purpose:

o   Personal Purpose – special talent that they feel fulfilled when expressing (i.e. cake baker)

o   Social Purpose – desire to build a community, product doesn’t really matter (i.e. wine maker)

o   Societal Purpose – affect something greater than themselves (i.e. Kate’s club, nonprofit)

·        New economy doesn’t entirely displace its predecessor, it complements and builds from it

·        Information Economy changed employees relationship with employers – no longer does an employee stay with one company that takes him/her under its wing for their entire career.. organization needs have caused these changes …employees have to fend for themselves so the mindset has changed… “ the instability caused by these major structural changes and magnified by the economic recession brought with it a need to find stability and a future path within ourselves, rather than from an employer”.

o   Purpose, rather than career longevity, provides the stability we need

·        10 Key Drivers to the Purpose Economy

§  Human scale technology – we are using technology that once isolated people/minimized social interactions and using it to regenerate that movement…connecting people with local farmers, local bloggers, borrowing from individuals instead of big banks, renting individuals’ homes rather than hotel chain.

§  The Maslow Millennial Effect – desire to make a difference, grow and share their passion with the world. A shift up in Maslow’s hierarchy of needs. People of all ages are feeling the shift but Millennials are the driving force.

§  Generation Disrupt – Generation X (IT Economy) came of age in dot com boom where they saw how powerful technology with the right idea and the right passion. It could change the way things had always been done.

§  Environmental, Economic and Political Turmoil – uncertainty of society is making people look into themselves for stability and to identify the needs and empathize with those affected by the turmoil – 9/11, Hurricane Katrina, the Great Recession especially impacted Millennials who were in their formative years during that time.

§  Longevity – Baby Boomers looking for purpose in their second careers whereas their first career was all about earning. This is creating a talent boom for the social sector.

§  Changing Families and Evolving Roles – shift in intellectual sector as opposed to physical sector allowed for more opportunities for women.

§  New Social Science – use highly researched “positive psychology” tools to measure employees overall well-being because those individuals are most productive at work. Role of work leadership is changing to not just helping employees move up the corporate ladder but to help them find purpose and meaning.

§  Accelerated Globalization – everyone is subject to higher visibility now making a higher level of accountability. More awareness of devastating situations around the world, seeing it first-hand makes others feel a need to make change happen. Technology has also led to faster social change in underdeveloped countries that wouldn’t have been possible without it.

§  A Shifting Social Context – seeing the gap in what the government is able to provide and they are trying to fill it. Trust in the federal government has been on the decline for decades. “Regan Revolution” emphasized putting the power and responsibility of society back into the hands of the people rather than the government.

§  Blending of the Sectors – hybrid business models between nonprofit and for-profit companies, lines blurring more...opportunity for returns but still have a social mission. To move/change the market have to incorporate corporations, nonprofits and government to do so.

o   Purpose is a verb and is something to be chosen…(i.e. not all doctor’s feel a sense of purpose, some just want career success for example)

o   Once American households meet roughly $70,000 in annual income, they are no more or less happy the more money they make

o   “Lean, earn and then return model” is outdated – rather all three aspects should be blended and practiced at every year of your career

o   Myth: don’t have to find one life-calling, one specific cause to help, purpose is about seeking a direction not a destination. PURPOSE IS AN APPROACH TO WORK AND SERVING OTHERS

o   Purpose isn’t a luxury reserved for the well off

o   Create a purpose/mission statement: WHO? HOW? WHY?

o   For two minutes each day, think about what surprised, inspired and moved you – way to PROACTIVE purpose

o   Traditional ideas around an unsatisfactory work environment would suggest changing the job but positive psychology/purpose ideals say change the job you’re in to better fit your needs

o   Why people leave?

§  Bad manager 

§  Organization 

§  If individual’s purpose drivers and company’s are not aligned

o   As companies grow, employees feel farther removed from feeling like they are working toward a clear purpose – why large companies develop volunteer programs…it’s a way to simulate purpose but it doesn’t have the same effect at all (for employees, it’s not fulfilling the same way as having a purpose-oriented job in the company)

o   Need an audacious goal, not a modest one if you really want to be successful… you go to the bank for a modest idea but to aim for the stars, you need rocket fuel

o   Vulnerability – in the new economy, you are not just putting managers in charge or someone’s job but in charge of someone’s entire purpose. This brings a whole new level of responsibility and accountability to leadership teams.

·        Well Being:  five core components to attain:  positive emotion, engagement, relationships, meaning, and accomplishment

·        Stats

o   Volunteerism/Purpose

§  32 million people are seeking purpose-rich second careers.  People find purpose in many places including 30% education, 25% health care, 25% government, and 11% non-profit organizations.

§  The number of volunteers age 65 or older in the US will increase 50% by 2020 from just under 9 million in 2007 to over 13 million.

o   Aging

§  In 1796, the average person only lived to be 24.  Just a hundred years later that person could live to be 48.  Now the expectancy is 76.

§  The average employee stays at a job for 4.5 years.

§  The peer-to-peer or sharing market is now estimated at $26 billion

§  Seniors now account for 12.9% of the population – a number expected to increase to 20% by 2030.  As of 2010 there were approximately 1.9 million home health and personal care aids in the US to care for them.  The employment of home health aids is projected to grow 60% from 2010 to 2020, with the personal care aid profession to grow 70%.

§  10,000 people reach the age of 65 every day in the US.

o   Misc

§  More than 17% of the fourteen million self-employed workers in the US consider themselves independent contractors or freelancers.

§  82% of women in the US now work, a 250% increase since the 1950’s.  Fewer than 7% of households have only a male breadwinner.

§  According to the Bureau of Economic Analysis, in 2010 the estimated economic value of household work would have boosted the American GDP by 26%. 

§  The number of preschool teachers is expected to grow by 25% between 2010 and 2025, and the number of childcare workers 20% in that same time.