22 Nov #199 – Don’t Make Profit Your “Turkey”
ESSENCE: Are you in (still in? always in?) a Thanksgiving mood! Get ready for a silly but hopefully meaningful analogy. If Thanksgiving was your business, what would “profit” represent in the Thanksgiving preparation and meal? Remember, profit is NOT bad, and the creation by business of economic prosperity is good. Profit in a business is necessary for good stewardship of the business, which means it is necessary for the Creation Mandate, which in turn means it is necessary for business in alignment with Biblical beliefs, principles and priorities, which in turn means it is necessary for the pursuit of Biblical flourishing through faithful integrity. Profit becomes bad when it moves from being a tool to being an idol. In business as usual, characterized by Profit as Purpose, profit is the turkey–the centerpiece of the table. Business a better way in alignment with Biblical beliefs, principles and priorities requires changing the heart of the organization by putting profit in its proper place as a means rather than an ultimate purpose–the star of the show. We think this re-orients profit as the heat source that cooks the turkey–absolutely necessary but not the focus. If a business prioritizes glorifying God by loving (through service) its employees, customers, vendors and community in a way that allows them to experience Biblical flourishing, profit is also likely to become the gravy–a by-product of a turkey cooked and served (with love). P.S. We are thankful for you!
Turkey on the weekend after Thanksgiving can be thought of as a leftover or another opportunity to enjoy something good. We decided to re-serve these Turkey/Profit thoughts from last season, but with some updates. Hopefully, you see it as “another opportunity to enjoy something good” and not a leftover! Just like turkey, it’s one of our favorites.
This may sound odd (okay, it is odd), but we were thinking about all the things that go into a traditional Thanksgiving meal and wondered what profit would represent in the Thanksgiving preparation and meal if Thanksgiving was a business.
Our conclusion is that profit is usually the turkey, but it shouldn’t be. It should be the oven (or the smoker or deep fryer) and the gravy.
Refresher: Profit Is Not Bad
Profit is NOT bad, and the creation by business of economic prosperity is good, because it enables families and communities to flourish. That bears repeating–PROFIT IS NOT BAD! In fact, we believe PROFIT IS NECESSARY for an organization (other than a non-profit organization) to be obedient to the Creation Mandate, which means in turn means it is necessary for business in alignment with Biblical beliefs, principles and priorities, which in turn means it is necessary for the pursuit of Biblical flourishing through faithful integrity.
Hopefully you recall the Creation Mandate (the commandment about our purpose on earth) that we discussed at length in post #46 (Lessons from Creation-Why We Are Here). Here it is again from Genesis 1:28:
And God blessed them. And God said to them, “Be fruitful and multiply and fill the earth and subdue it, and have dominion over the fish of the sea and over the birds of the heavens and over every living thing that moves on the earth.”
Theologians (which we do not claim to be) seem pretty confident that the terms “subdue” and “dominion” mean “stewardship“. We are to care for all God’s creation as its STEWARDS.
We believe faithful stewardship of an organization must take into account four principles–Respect, Sustainability, Mutuality and Generosity:
• Respect. Respect for all humans because God created them, which means treating all stakeholders of an organization (owners, employees, vendors, customers, communities) with dignity and caring about how the organization is impacting their flourishing.
• Sustainability. Sustainability across all aspects of a business, including its utilization of all forms of capital that drive the business and its relationships with the stakeholders related to those forms of capital. We have frequently turned to Jeff van Duzer’s book Why Business Matters to God (And What Still Needs To Be Fixed), and its insights on the breadth of sustainability are worth quoting: “Sustainability, however, can be understood in a much broader sense as well. As a business pursues its purposes, it must do so in a way that is sustainable across all of the dimensions of its interactions with its stakeholders.” This requires leaders to assess the usage and the availability and health of all the capital it requires to keep operating–natural, human, social and financial.
• Mutuality. Mutuality is about an organization extending its culture of Shalom to all people it touches by managing all capital from a Biblical view of relationships, community, human dignity, flourishing and the common good. Mutuality is about ensuring that transactions are “fair” to both parties, regardless of bargaining leverage. It embodies the Golden Rule (Luke 6:31) and helps ensure sustainability of the organization, its relationships and its capital.
• Generosity. As explained in post #189 (First Things–Righteousness), faithful integrity requires more than “giving generously”–it requires the “vertical integration” of generosity by “living generously”. Living generously is about operating the organization (and, in the process, generating wealth) in a way that generously loves others and stewards creation. Living generously is living sacrificially–choosing to give something up or to forego a benefit because it benefits the common good–because it represents faithful integrity and increases the Biblical flourishing of others. In this respect, generosity is closely tied to mutuality–treating vendors, employees, customers and communities more fairly than you might need to based on your bargaining leverage is living sacrificially–and it is faithful stewardship.
Profit in a business is necessary for the key elements of faithfully stewarding the business in obedience to the Creation Mandate.
• Respect. Business a better way does not mean ignoring owners. A business pursuing the maximization of Biblical flourishing through faithful integrity needs to promote and facilitate the flourishing of ALL its stakeholders, and that includes owners. It needs profit in order to permit its owners to flourish through a fair return on their capital. Anything less is not respecting them, and that is poor stewardship.
• Sustainability. Without profit, a business will lose access to one of the four types of capital on which a business relies–financial capital. Without profit or access to financial capital, the business is likely to be unsustainable, and that is poor stewardship.
• Mutuality and Generosity. It is fair to say that an unprofitable business unable to Respect its owners and struggling with Sustainability because it has difficulty accessing financial capital is unlikely to be focused on treating others more fairly than it can get away with. In reality, it is more likely to engage in business as usual survival tactics (e.g., paying as little and as late as possible) and be hoping others treat it with Mutuality and Generosity.
Put first things first and we get second things thrown in: put second things first and we lose both first and second things. (C.S. Lewis)
Profit at Thanksgiving
We think the centerpiece of Thanksgiving is the turkey. Yes, we know some of you are all about the stuffing or the mashed potatoes or the pies, but we are going with the focus of Norman Rockwell’s famous Saturday Evening Post cover from March 6, 1943, “Freedom from Want”–its all about the turkey.
Profit as the Turkey – Business as Usual: Profit is not bad just like money is not the root of all evil. It is the love of money that the Bible tells us is the root of all evil. Like money, profit becomes bad when it moves from being a tool to being an idol. If anything is the “idol” of the Thanksgiving table, its the turkey. Profit should not be the turkey.
Perhaps the most consistent theme over the last 198 posts is that profit becomes a problem when it becomes the purpose of a business. We call it Profit as Purpose, and it is a hallmark of business as usual–business according to the world’s beliefs, values and priorities. If a Thanksgiving table represented business as usual, profit would be the turkey.
Profit as Purpose is the idea that the primary or sole purpose of a business is the maximization of financial profit for the benefit of shareholders. As we explained in post #169 (The “Way” of the World), it is often referred to as the “shareholder primacy” model, and it has been predominant for the last several decades in America.
If profit is the turkey–the focus of the painting, the centerpiece of the table and the end toward which a business is managed:
• People and the rest of creation can never be more than tools of production to be managed toward that end (“No one can serve two masters“, Matthew 6:24).
• People will be valued based on their perceived profit contribution, and value is likely to be based on short-term profit or stock value.
• Decisions will be made mainly based on financial metrics, because they measure profit and they are easily measurable.
• Because an organization manages to its purpose, a key role of the organizational culture of the business will be to drive profit. Business culture can be designed (or will just emerge) to drive or inspire people to perform at higher levels and contribute more to profitability through manipulative mechanisms like bonuses/commissions/promotions and the fear of elimination or demotion.
Profit as the turkey works against faithfully stewarding people and the rest of creation toward Biblical flourishing, which means it works against the Creation Mandate.
In describing the role of profit in an organization, leaders sometimes characterize the role and priority of profit in ways that sound good but are not in line with Biblical principles or reality. In post #059 (Love-What About Profit?), we explained why profit can’t be one of several “ends” (i.e., “Look, we are not all about the turkey–we have stuffing and mashed potatoes and brussel sprouts“) and why Profit as Purpose can’t be transformed into a bigger WHY. Like a person, an organization can have only one ultimate ambition–one ultimate identity–one true “heart”. Without intentional leadership, that heart will be business as usual and profit over people and profit as the turkey.
Profit as the Oven and the Gravy – Business a Better Way: We realize you may be getting tired of this Thanksgiving analogy, but stick with us through at least one turkey sandwich and bowl of turkey soup.
Business a better way requires changing the heart of the organization by putting profit in its proper place as a means rather than an ultimate purpose. This is profit as the heat source that cooks the turkey–whether you are a roaster, smoker or fryer. Unless you cook the turkey, Thanksgiving will be a bust. If you are hosting Thanksgiving, the heat source is critical to being a good steward of that responsibility.
But Thanksgiving can’t be about the heat source (notwithstanding the Dad who just bought his smoker or fryer and is showing it off for the first time). Recognizing profit as a good and necessary tool toward a bigger WHY, a leader can focus on optimizing profit toward the maximization of that WHY. But what WHY–what is the turkey?
The Bible offers the ultimate WHY for our work and for business, because it is the ultimate WHY for all we do. We are called to use our gifts to “serve one another” in a way that glorifies God (1 Peter 4:10-11). Ken Eldred captured this beautifully:
Profit is like oxygen. You absolutely need it to win the race. But that’s not the objective. The primary objective of business is serving others to the glory of God.
As we explained in post #101 (God Glorified), a business glorifies God principally through lovingly and generously serving people and stewarding all creation: (1) providing jobs that allow people to experience Biblical flourishing by fulfilling their humanity and purpose in living out Imago Dei, the Creation Mandate and the commandments to love God and love each other through service, (2) providing economic prosperity, goods and services, and by solving problems and “repairing” the world, in ways that enable families, communities and creation to flourish, and (3) creating a culture of Shalom built on Biblical principles of relationships, community and human dignity that is conducive to the flourishing of all people it touches. In other words, Glorifying God by Humanizing people and Beautifying the world.
If a business serves its employees, customers, vendors and community in a way that glorifies God, profit is also likely to become the gravy–a by-product of a turkey cooked and served with love. When a business Humanizes people and Beautifies the world such that its employees, customers, vendors and communities flourish, it is likely that the business bringing about that flourishing will itself flourish. It flows from the instructions in Matthew 6:33 and Jeremiah 29:7:
But seek first the kingdom of God and his righteousness and all these things will be added to you. (Matthew 6:33)
But seek the welfare of the city where I have sent you into exile, and pray to the Lord on its behalf, for in its welfare you will find your welfare. (Jeremiah 29:7)
It is important to note that profit as gravy is not the same as the Side Road of Prosperitizing described in post #034. Prosperitizing is when a leader integrates faith and business in order to get God’s blessings in the form of increased profits. In Prosperitizing, cooking the turkey is really all about getting the gravy. If you have been following our posts, you will recall we spent 26 posts (#039-#064) on the principle of Keeping First Things First. Profit as gravy is a second thing. Glorifying God through the maximization of Biblical flourishing is the first thing. It was C.S. Lewis who wrote:
Put first things first and we get second things thrown in: put second things first and we lose both first and second things.
Optimizing profit means generating the optimal level of profit to maximize the Biblical flourishing of all creation touched, particularly people, in a way that recognizes God’s stewardship limits of Respect, Sustainability, Mutuality and Generosity. It is seeking the level of profit that brings God the most glory.
PERSONAL NOTE (from PM): I have a confession–I know I said turkey is the centerpiece, but if it came down to a choice between the turkey and Lisa’s sausage stuffing, the turkey would lose every time.
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