Sorry POTUS, But Good Business Does Require Heart

June 3, 2017 Leave a comment

I recently read this quote attributed to President Trump:

Here, everything, pretty much everything you do in government involves heart, whereas in business most things don’t involve heart. In fact, in business you’re actually better off without it.

My take: No, no, no! This is wrong-minded, and very outdated thinking. To succeed, businesses must make emotional connections with customers, employees, and partners. The idea that success comes from being heartless promotes the debunked view that companies exist only to create value for shareholders. Here’s one of the points that I make in Modernized Leadership, which is an update to leadership theory:

Management focus has been driven by economists like Milton Friedman who argued that corporate officials have one core responsibility: making as much money as possible for their shareholders. But the value that a company creates comes from a combination of resources contributed by different constituencies (not just investors) who’s returns should also be maximized, especially employees who contribute their knowledge and skills.

POTUS is free to view his businesses as heartless entities that exist to increase his net worth. But I am hopeful that other leaders and emerging leaders don’t follow his lead. Even Jack Welch has rebutted the blind focus on shareholder value:

On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy… Your main constituencies are your employees, your customers and your products.

If you’re a leader, than I hope that you focus on engaging the hearts and minds of your employees, customers, and partners. Creating value for an entire eco-system is more sustainable and rewarding than counting your profits.

The bottom line: Businesses need even more heart.

Filed under Customer experience, Executive leadership

About Bruce Temkin, CCXP
I'm an experience (XM) management catalyst; helping organizations improve results by engaging the hearts and minds of their employees, customers, and partners. I enjoy researching and speaking about these topics. I lead the Qualtrics XM Institute, which is the world's best job. We're igniting a global community of XM Professionals who are inspired and empowered to radically improve the human experience. To achieve this goal, my team focuses on thought leadership, training, and community building. My work is driven by a set of fundamental beliefs: 1) Everything starts and ends with human beings, so you need to understand how people think, feel, and behave; 2) XM is a discipline that needs to be woven throughout an organization's entire operating fabric; and 3) Building the XM discipline requires a combination of culture, competency, and technology.

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