After decades where we increasingly bought in to the idea that “what’s good for Wall Street is good for America,” the financial crisis is causing many people to question the nature of business. Is greed and corruption merely “business as usual?” Or can business be a force for good?

In the bubble, a lot of people got rich gambling with other people’s money. And when those bets turned sour, the losses were paid for, not by the people who made the bets, but by taxpayers and by millions who lost their jobs. When combined with the cases where big businesses have contributed to ecological devastation, Enron-style fraud, and childhood obesity, there’s a lot of anger about the way business is being done.

But here’s the thing. Capitalism is far and away the most powerful system ever developed for creating wealth and raising our standard of living. Over the last 190 years, the real per person income level in the US has increased from $1,200 to $31,000. Our level of wealth has increased so much that we now drive to our protests.

Capitalism creates wealth – enormous wealth – and this wealth pays for our homes, education, health care, social services, and the many non-profits we donate to.

The problem isn’t that business is bad. In its own way, business is already a tremendous force for good.

The problem is that most of this good is being done unconsciously. It’s being done almost by accident, rather than as part of a consciously defined purpose. Relentless, ruthless competition creates profits – lots of profits – but these profits come with a price.

As its most commonly practiced, traditional business has three core problems.

It’s short on purpose.

It’s long on fear.

And it’s unsustainable.

Purpose. A colleague of mine does a lot of work with boards of directors. These men (and yes, they’re almost all older, white men) have lots of grey hair. They’ve risen to the top of their competitive ladders. And yet their biggest question is usually, “is this all there is?” They’ve often sacrificed everything to their careers, only to find a sense of emptiness and a lack of fulfillment.

The reason for this is that traditionally, we’ve compartmentalized money and meaning. For-profits are supposed to make money. Non-profits are supposed to make a difference. And that has left many people in business feeling successful put unfulfilled.

Answering these questions requires three things.
1)     Understanding the core reason why traditional business has these problems.
2)     A desire and a commitment to make a change.
3)     Practical, effective systems for doing so.

Fear. At its core, traditional business is fueled by scarcity and stress – two polite names for fear. Why do people get corrupt and greedy? Because they’re afraid there’s not enough to go around. In daily life, we don’t get greedy for air. We don’t try to hoard it, or store it away, because we trust that there’s enough for everyone. But capitalism is based on relentless, ruthless competition over scarce goods and services – and that creates fear. Feeling stressed about work isn’t something special. It’s an automatic consequence of being part of this system.

Sustainability. Capitalism’s greatest strength is its unparalleled capacity for economic expansion. And capitalism’s greatest challenge is its addiction to that expansion. Our entire financial system is predicated on the assumption that GDP will always keep increasing. Stock markets, debt and retirement funds all depend on this. So does our monetary supply. But continuous exponential expansion is unsustainable, and we’re rapidly reaching its limits.

Capitalism is a system with tremendous strengths – and with equally tremendous challenges.

So the real question is not “can business be a force for good?” The real question is “how can business be more of a force for good?” How can it provide more purpose, less fear, and more sustainability? And how can it do this more consciously, rather than as something we try to just fit in the cracks?

Does this resonate? If you’re a purpose driven practice builder, you’re likely acutely aware of the challenges of traditional business, but you haven’t yet learned a way of getting clients that feels good to you, and works for your business.

If so, please feel free to check out the videos at www.sellingbygiving.net to learn more about the core challenge of practice building, and the keys for resolving it. Enjoy!

GM’s bankruptcy. Goldman’s bonuses. AIG’s collapse. It’s easy to look at what’s going on and say “How Stupid!” And this is true - but perhaps not in the way you think. This is because study after study shows that the core problem in business is not a lack of cognitive intelligence. It’s a lack of emotional intelligence.

Yet almost all of our focus, education and training misses this point.

Think about your work for a minute. What - or perhaps who - are the biggest challenges you face? What are some of the tactics you have tried so far to fix them? Do these issues seem stupid sometimes?

Well, they are. Not because the people involved are stupid, but because the core of these issues is usually emotional in nature, and can’t just be solved in our heads. People seem irrational sometimes because the roots of our issues aren’t rational.

The simple truth is this: at their core, 80% of unresolved issues are not intellectual or ideological, but emotional in nature. And while we receive many years of schooling for our minds, very few of us are ever given classes on how to work with our emotions and the emotions of others.

Emotional “blind spots” are often the most prevalent - and most crippling - at the top of the company. Think about Enron. The executives there were known as “the smartest guys in the room” yet they managed to do some remarkably stupid - and illegal - things. Now we could look at them and say they were bad, evil people, and we’d never do such things. But is that really true? In my experience, everyone is doing the best they know how to get their needs met. It’s just that sometimes, our best isn’t enough. And most of the time, this is because we haven’t yet developed enough emotional intelligence to deal with the challenges we face.

In Developing Management Skills, David Whetten and Kim Cameron summarize this research.
“A study of UC Berkeley Ph.D.’s over 40 years found that EQ was four times more powerful than IQ in predicting who achieved success in their field - even for hard scientists. A McBer study comparing outstanding managers with average managers found that 90 percent of the difference was accounted for by EQ. In a worldwide study of what companies were looking for in hiring new employees, 67 percent of the most desired attributes were EQ competencies. In a study of highly emotional intelligent partners in a consulting firm … the high EQ partners contributed more than twice as much revenue to the company as did the low EQ partners.”

Think about GM. From 1984 - 1999, GM was the #1 company in America. In 2009 it declared bankruptcy. For decades GM was able to hire from among the smartest graduates our schools had to offer. If we were to test the IQ of its people, it would surely be well above average. But over time, it developed a culture that was more and more dysfunctional. The conflicts between labor and management kept getting worse, escalating bureaucracy made change increasingly difficult, and a creeping sense of entitlement sucked away its competitiveness and creativity.

Because here’s the thing. Emotional problems breed. Once an emotional issue has taken root in a company, it grows. It spreads. It infects others. Like a cancer, it eventually metastasizes, to the point where it can kill a company. Saturn was created as a way of reinventing the way GM did business. For a while it worked brilliantly. But eventually the emotional diseases in the parent company took over.

This is why companies report such incredible returns from coaching. Great coaching is all about training people - in direct, pragmatic, applied ways - on how to increase their emotional intelligence. It supports companies in curing the root of their problems, instead of just focusing on the symptoms.

One study of 140 companies showed that they received $5 for each $1 spent on coaching. Another study measured an ROI of 600%. “Asked for a conservative estimate of the the monetary payoff from the coaching they got, these managers described an average return of more than $100,000, or about six times what the coaching had cost their companies.” - Fortune, 2/19/01

In my work as a coach, I’m regularly amazed by the level of hard results that occur when we focus on the “soft” side of the business. As Roger Enrico, a Vice Chairman of Pepsi stated, “The soft stuff is always harder than the hard stuff. Human interactions are a lot tougher to manage than numbers and Profits and Losses.”

So how do you work with this? In a series of upcoming columns I’ll be walking through 7 Secrets of Emotional Intelligence. Or if you want, please feel free to jump ahead and download the whole article.

Additional resources are available at http://www.corecoaching.org/resources.html.

Do you have any questions on this topic? If so, please feel free to send them to corecoaching@corecoaching.org and we may answer them in a future column.

The financial industry is based on trust, and in the last year Wall Street has lost a ton of it. So what are we to do about this? In the face of all that’s going on, who can you trust?

The bad news is that large pieces of the industry aren’t all that trustworthy. Not because they’re liars or cheats (or at least not necessarily). But because so many people have bought into a series of lies – a set of widely held myths that cause individual investors to lose hundreds of billions of dollars each year.

The good news is that there’s a terrific new book, The 12 Investment Myths by Jack Calhoun, that exposes many of these lies and gives terrific guidelines for knowing who to trust. It’s short, simple, sweet and powerful. Ideally, it would be required reading for anyone with a 401(K) or stock portfolio.

From 1987 – 2007, the average stock-fund investor made 4.5% per year, while the stock market’s return (as measured by the S&P 500) was 11.81%. Why the huge difference? Because so many individual investors buy into these 12 myths.

In particular, studies consistently show that a blind monkey throwing darts at a list of stocks would do better than the average mutual fund, yet much of the industry’s profits are based on pretending this isn’t true.

Here are three key excerpts from the book, reprinted with the author’s permission.

“MYTH 1: A Savvy Investor Should Be Able to Beat the Market

FACT: Hope springs eternal for investors that they can find the market-beating guru to lead them to easy riches. But active managers have a nearly insurmountable hurdle to overcome due to the high costs associated with frequent trading. Those few managers who beat their benchmarks are usually flashes in the pan and don’t sustain their winning ways for long. Investors who fall prey to the siren song of the market-beating guru usually end up experiencing only disappointment and lost potential earnings as they migrate from one high-flyer to another just as the managers are poised for a return to mediocre performance.

SOLUTION: Learn to joyously accept the fact that the market is your friend to be embraced, not an enemy to be vanquished. Earning market rates-of-return is hardly accepting “average” returns, because historically the market beats more than 80% of active managers.”

“MYTH 2: Brokerage Firms Are Built on a Client Service Model

FACT: The big brokerage firms are not built on a client-service model; they are built on a product-distribution model. The endless, massive fines those firms keep incurring for violating their investors’ best interests testify to this fact. Brokers who are compensated by the products they sell cannot claim to be objective and do not meet a fiduciary standard of care for their clients.

SOLUTION: If you want to work with an advisor, find one who is an independent, fee-only Registered Investment Advisor. Such RIAs cannot accept commissions and act as fiduciaries for their clients, meaning they are required to put their clients’ best interests ahead of their own.”

“MYTH 3: It’s All about Performance

FACT: It is one of the great ironies of investing that the more you make investment decisions based on performance, the more likely you are to experience poor performance. The reality is that the performance of stocks, funds and managers is usually attributable to what market sectors have recently been in favor. Since those sectors cycle in and out of favor quickly and unpredictably, investors who chase returns usually miss the run-up and arrive just in time for the downturn.

SOLUTION: Since you can’t control which segments of the market are going to be hot going forward, select investment vehicles based on factors that you can control in the investment process: sales charges, expense ratios, and trading. Keeping such expenses to a minimum (or, in the case of sales charges, avoiding them altogether) is much more predictive of future success than chasing returns.”

The bottom line? If you want to know who to trust, a great start would be to learn these 12 myths and avoid those who buy into them.

Love and light,
Brian

P.S. At root, many of the financial industry’s challenges come out of the same core conflict we address in Selling By Giving. Jack Calhoun’s investment management company is a great example of a conscious business, in that they’ve figured out how to cleanly integrate sales and service and have a tremendous commitment to providing exceptional value.

Deep down, most service professionals don’t really want to build their practices. They wish their clients would just show up. They wish they could just provide their services without having to sell those services.

Not because these professionals are lazy. Or unworthy.

But because of a profound inner conflict. A conflict between their feeling that selling means taking while their services are about giving.

This conflict isn’t irrational. It’s the natural result of growing up in a culture driven by mass marketing. Think about it. When you open your mailbox, what do you get? Unwanted advertising. When you turn on your TV? Unwanted advertising. Receive a call from a telemarketer during dinner? Unwanted advertising.

We naturally learn to feel that selling means taking, because mass marketing is based on interrupting people. It’s based on taking your attention away from what you care about, and redirecting it to something the marketer cares about. It’s based on a subtle but persistent form of violence.

This leaves service professionals feeling like they’re caught between a rock and a hard place. Either they embrace mass marketing as a necessary evil, or else they suffer along without a lot of money or clients. Either they build a business based on taking or else they sacrifice themselves for their calling.

Because of this, most practice builders struggle. 80% of coaches make less than $20,000 a year. It takes the average therapist five years to build a practice making at least $50K a year after getting their license. And 95% of new businesses fail within five years or else limp along as a continual drain on the founder’s time and energy.

But here’s the thing.

Mass marketing is dying.

Interruption based marketing is being replaced by permission based marketing. Indiscriminate advertising is being replaced by web of trust marketing. And selling by taking is being replaced by Selling By Giving.

In the words of Seth Godin, mass marketing is being replaced by people who are willing to lead a tribe.

This isn’t just pie in the sky. The most successful company in the Internet is based on permission based marketing. Google grossed over $21 billion last year, serving us with advertisements we want to see, when we want to see them. In contrast, newspapers who built their businesses on interruption based marketing are dying out, even though they provide a crucially valuable service.

If you feel that selling means taking, it doesn’t matter how pretty your web site is, how many marketing consultants you hire, or how good your services are. You’re still going to feel like you have to choose between selling out - or not selling at all. You’re still going to feel like you have to pick between creating a business that creates money or meaning. (Besides, it turns out that mass marketing never really worked for service professionals anyway.)

But it doesn’t have to be that way. Instead, we’d love for you to come join the movement of service providers who are pioneering a new, more loving, more successful way of doing business.

Love and light,
Brian

P.S. I was awed by the results from the most recent graduates of the 6 month Selling By Giving teleclasses. For example, one student created $20,000 of new income during the second half of the class and many students reported transforming their relationship to sales. If you’re interested in being part of the next set of classes, starting June 2nd, please visit http://www.sellingbygiving.net/teleclass.php and then call Scott at 310-722-1028, so he can help you determine whether or not it would be a fit for you. The classes are already more than half full, and the waiting list may start as early as next week.

If you’re a fish living in an aquarium, it doesn’t take a whole lot of ingenuity to discover things like food, rocks, bubbles, and other fish.

But it takes a genius to discover water.

In response to a recent article on conscious business, someone asked me “so, what do you mean by conscious?” And I got stuck. I couldn’t provide a concise answer. The whole notion of consciousness had become so core for me that that I was at a loss for words.

Then in my morning meditation today, I realized that the defining genius of some of my favorite teachers (such as Ron and Mary Hulnick, Steve Chandler, Ken Wilber and David Hawkins) is that like a fish explaining water, they’ve learned how to explain consciousness to other humans.

The picture below shows the ladder of consciousness. At the bottom of the ladder is death. As Steve Chandler points out, you’ve got to be a pretty good salesperson to close a deal with a dead person. And death makes it a lot harder to hit the quarterly numbers.

Just slightly above death is fear, along with its partners judgment and pain. Fear makes us stupid. It makes us un-conscious. At a physical level, it literally sucks the blood from our brains, reverses tens of thousands of years of evolution, and puts us into “fight or flight mode.” When we’re feeling scared, angry, hurt, stressed, guilty or unworthy, we’re in a very low state of consciousness. Most violence comes from this level of consciousness, as do most of the deeper challenges in relationships and business.

At the top of the ladder is the power of the human spirit. Think Gandhi, Chariots of Fire, and the firemen at 9/11. Think “yes we can.” This is where creativity lives, as well as inspiration, joy, love and peace. When we’re living life from the top of the ladder, we’re at the top of our game. Ideas flow, synchronicity connects, and we’re able to see how even the most painful challenges in our lives have been gifts for our learning and growth. This is a place of profound but grounded optimism - what Jim Collins calls Level 5 Leadership.

This grounded optimism makes a huge difference. According to Dr. Martin Seligman, “I have studied pessimism for the last twenty years, and in more than one thousand studies, involving more than half a million children and adults, pessimistic people do worse than optimistic people in three ways: First, they get depressed much more often. Second, they achieve less at school, on the job and on the playing field, much less than their talents would suggest. Third, their physical health is worse than that of optimists.”

When we’re at the top of the ladder we live life much more consciously than when we’re at the bottom. We see how interconnected life is, and we treat other people and our environment with care and consideration. Not because we “should,” or because we want others’ approval, but because we genuinely want to. From this place, we naturally shift our focus from a single bottom line to a triple bottom line (of profits, society and the environment.) We create businesses that provide both money and meaning. We create conscious businesses – organizations that are aware of the ladder of consciousness, and focus not just on what they do, but also on how they are.

Organizations which are not only aware of the other fish in the tank, but also of the water they swim in.

Small business is big business. In the United States, more than half of all jobs are in companies of 100 people or less and more than 10% of all people are self employed.

Yet most small businesses fail.

Why is this? And what can you do about it?

The biggest problem is that most small business owners don’t really own their businesses. They act like employees rather than entrepreneurs. They love providing their services, but desperately wish they didn’t have to do all that “business stuff” that goes with it. They assume that 80% of their success will come from the quality of their services. When in reality, 80% of success comes from the quality of your business systems. It comes from the quality of your recipe for success.

Building a business is like baking a cake. It requires a set of ingredients and a recipe. If an ingredient is missing, or a step is left out, it doesn’t work. Yet most practice builders focus all their energy on just two or three of the ingredients, and don’t even realize they need a recipe. Then they wonder why business always seems so tough.

Small business guru Michael Gerber says that the fatal assumption most service providers make is: “if you understand the technical work of a business, you understand a business that does that technical work.” In other words, we assume that all we really need to do is offer a great service and have great intentions, and clients will beat a path to our door.

But this simply isn’t true.

An employee asks “what do I need to do today?” A business owner asks “how’s my recipe for success doing today?”

An employee gets caught up in doing what’s urgent, and measures success according to how busy their day was. A business owner focuses on doing what’s important, and measures success according to the goals and key metrics of the business.

An employee builds a business through trial and error – by making all the mistakes themselves. A business owner constantly seeks to learn from others’ mistakes – by learning which recipes have worked for others, and which ones haven’t.

This challenge is particularly critical for coaches, counselors, healers and other service professionals. In fact, most practice builders have a hard time even admitting that they are a business owner.

If this resonates with you, here are three key questions to ask yourself.
1) Do I really want to be a business owner or an employee?
2) What challenges are standing between me and the business I want to own?
3) How can I get support with those challenges?

During the boom times, many people with employee mindsets managed to keep their small businesses and service practices afloat, without having to really learn how to own their businesses. That’s no longer working.

The good news is that there are tremendous resources available for small businesses and practice builders, to help you take this challenge and turn it into an opportunity. Here are two.

The E-Myth Revisited by Michael Gerber – Required reading for small business owners
Selling By Giving – Conscious practice building for service professionals

In the wake of the financial crisis, there’s been a lot of talk about ethical reform. With the disgrace of so many of “the best and the brightest,” there’s a lot of soul searching going on in government, industry and business schools. Most of this discussion is focused on regulation and rules – it seeks to answer the question “what is good behavior and how can we mandate it?”

This line of questioning is important. But it risks missing the deeper issue, because meaningful ethical reform requires making ethics meaningful.

Meaningful ethical reform requires moving beyond just the “what” question and also addressing the “why”. It requires moving beyond creating lists of behaviors people should comply with to connecting them with values they freely choose to live their lives by. Not out of a sense of obligation, but because they get how these values create meaning. And because they’ve learned concrete tools to deal with the conflicts that inevitably arise as they seek to live a meaningful life.

“Why would people freely choose to live an ethical life?”

Not out of a fear of punishment. A choice made out of fear isn’t a free choice. It breeds surface compliance and hidden rebellion. It creates preachers who rail against sex while having affairs. As Joan Borysenko puts it, “Punishment is an effective way to change behavior, but usually not in the desired direction.” When motivation comes from a place of I should or I must, it’s sourced from fear and guilt. This can keep us from doing something awful, but it can’t inspire us to authentic ethics or authentic leadership, which come from a place of I choose.

Similarly, authentic ethics can’t come just out of a desire for approval. Do you remember the petty cliquishness of high school? That’s what happens when a group of good but insecure people seek to define their self worth according to others’ opinions. A life based on approval seeking quickly degenerates into an empty race for money and status. While our desire for approval can be a force for good – the shaming of investment banking’s excesses is creating a major drive for change – the whims of the crowd are fickle and can reward vice just as easily as virtue.

The primary, enduring reason to freely choose an ethical life is that a meaningful life is an ethical life. The meaning of life comes from growth, giving and connection – three of the primary forms of mature love. Mature love is the foundation of all ethics (i.e. “do unto others as you would have them do unto you”) and a meaningful life is also an ethical life.

If we simplify human needs down to their essence, we all have three basic levels of needs: survival, success and fulfillment (i.e. meaning). We all crave meaning, particularly once we’ve met our basic needs for survival and success. Because of this, we don’t need to convince people that they should live an ethical life. We just need to help them understand – in their whole being – how authentic ethics are an essential aspect of creating the meaningful life they crave.

But – and this is key – ethical behaviors do not necessarily create a meaningful life. This is because authentic ethics are determined not just by what we do, but also by where we do it from. When we do ethical behaviors from a place of fear, guilt or approval seeking, the result is fragile and empty. It’s only when our ethics come from a genuine place of mature love that they create a lasting, meaningful foundation for life.

Yet how many business textbooks talk about love? How many college courses teach authentic leadership? How many high schools teach students practical tools for how to be more loving?

Not nearly enough.

In the past decades, we’ve increasingly bought into the idea that “separation of church and state” means “separation of heart and mind.” Church is where we’re supposed to learn how to love, and school is where we’re supposed to learn how to achieve.

This divorce is at the heart of the current crisis. It’s contributed to a compartmentalization between our personal and professional lives, and to an attitude in business where “anything goes unless it’s forbidden or unprofitable.” So if we want to address the roots of this crisis, we need to learn how to integrate money and meaning – both in our lives, in our businesses, and in our schools.

The practice of integrating money and meaning automatically and consistently brings up inner conflicts. It brings up challenges that can’t be solved just in our heads. It brings forward dilemmas that can only be resolved through deep personal and spiritual growth.

Because of this, there is no such thing as a theoretical class in authentic leadership. Authentic leadership requires integrating body, mind, and spirit. It requires learning how to integrate success and fulfillment, sales and service, money and meaning. It requires learning how to embrace the conflicts in life, and how to use everything as opportunities for learning, upliftment and growth.

This doesn’t mean that our schools need to become more religious. It means they need to become more loving.

Over the past decades, business schools have sought to become ever more scientific. But by increasingly basing their existence solely on the cult of reason, they’ve been feeding the divorce between heart and mind, rather than healing it. In doing so, they’ve been failing our students, failing our businesses, and failing our society.

If we wish to create meaningful ethical reform in business, it requires bringing meaning and love back into education. In particular, it means bringing meaning and love back into business schools. It requires teaching students practical, concrete, psycho-spiritual tools for how to work with their inner conflicts. It requires teaching them how to embrace the challenges that automatically come up as we seek to build businesses that create both money and meaning. It requires renouncing the fundamentalist dogmas of the cult of reason and of the single bottom line. And it requires evaluating our schools not just on whether they produce smart and successful students, but also on whether they produce wise and fulfilled ones.

P.S. Have you checked out the free $100 practice building kits we’re giving away yet?  While they’re particularly focused on practice builders, the first CD in particular contains some of the leading, practical tools for how to create a business that embraces both money and meaning.

Hello,
It’s Brian here, from Selling By Giving.

The current financial crisis has created a real “sink or swim” opportunity for hundreds of thousands of coaches, counselors, healers, financial advisors, real estate agents, and other self-employed service providers.  In the face of increased challenges, many people are losing clients or even closing up shop.  But some are actually growing their practices, often by $20,000, $50,000 or $100,000 a year.  What’s the difference between these groups?  Support.  The later group keeps reaching out for help, and keeps using each challenge as an opportunity for growth, rather than buying into the story that “I should already know how to do this.”

Lots of people are seeking that support.

We’ve decided to do something radical to help them.

And we’d like your help.

We’re giving away $1,000,000 in free practice building services this year, in the form of 10,000 life-changing practice building kits.  These $100 kits are powerful.  They come with 150 minutes of cutting edge content, a powerful diagnostic assessment, a 90 minute live teleclass, an e-book and e-coaching.

One woman told us she listened to the first CD over 20 times, because she got how deeply it spoke to a core challenge that had been holding her back.  Last week, she emailed me telling me she’d had more clients in the last two weeks than in the previous three months.

Another man just emailed me today, thanking us for his new level of inspiration and faith, “I have been having turmoil over the business and money, fears, etc. But now, after simply reading all of your websites, I am confident to the point where my fear is fading fast, I am not concerned with money nearly as much and I know I am on the right path FOR ME.”

This stuff works.  It can help people make a radical shift in their response to the crisis.  It some cases, it can make the difference between succeeding at their dream vs. closing their business.

Will you please help us to help others?  Will you please help us give away $1,000,000 in practice building kits?

To do so, please pass this email along to your friends.  And if you haven’t done so yet, please go to www.sellingbygiving.net to claim your free kit.

Thank you!
Brian

Hello community,
We’re preparing a conscious business manifesto, and we would love any feedback you would care to offer.

Please find the current draft at www.consciousbusinessnow.com.

Then please feel free to join the discussion on this topic, by posting your comments below.

Love and light,
Brian