Dave Ulrich
Dave Ulrich is a business professor at the University of Michigan, a partner at RBL Group, and the author of twenty-three books. In his book, The Why of Work: How Great Leaders Build Abundant Organizations That Win, Ulrich argues that to achieve extraordinary results, leaders must pay as much attention to creating meaning for employees as they do to making money.
We asked him how organizations can understand and implement his leadership model, and what challenges leaders can expect as they strive to offer their employees deeper meaning in the world of work.
7 Principles of Abundant Organizations
Abundant organizations…
- Build on strengths (capabilities in an organization) that strengthen others.
- Have purposes that sustain social and fiscal responsibility and align with individual motivation.
- Take work relationships beyond high-performing teams to high-relating teams.
- Create positive work environments that affirm and connect people.
- Engage employees’ skills, commitment, and their values (contribution).
- Use growth, learning, and resilience to respond to change.
- Honor the diversity of what makes people feel happy, cared for, and excited about life.
Adapted from The Why of Work, by Dave Ulrich
McLaughlin: When you refer to “abundant” organizations, what do you mean?
Ulrich: When I think about abundance, three main attributes come to mind. First, abundant organizations help employees find a sense of purpose for the work they do. But I’m not just talking about social enterprises where we find meaning and throw parties.
Second, and equally critical, is value for all stakeholders. Abundant organizations create value for customers by providing exceptional products at good prices. They also create value for investors and instill confidence in present and future earnings. And they add value to their communities.
And finally, abundant organizations play a critical role in society as a whole. We spend an enormous amount of time at work, and we should shape these organizations, not just to achieve a certain gross domestic product but to make a meaningful impact for everyone.
McLaughlin: Considering the past several years, do you believe organizations are getting better at creating meaningful work for people?
Ulrich: My sense is that the mindset is shifting. Leaders are realizing that providing meaningful work is a business agenda, not just a social one. And that’s the first step.
A leader can let you bring your parrot to work or give you a gift certificate but, as isolated events, they don’t change much. Leaders need to recognize that offering meaningful work has to become an integral part of the culture of their organizations. Out of that will flow a deeper and longer commitment.
McLaughlin: And you think it’s shifting in a positive direction now?
Ulrich: Well, during this recession, I think some companies have taken advantage of employees. They said look, the economy is hurting and we need to take some things away. Some companies went back to controlling employees the way they used to.
With so many people out of work the last few years, employees are grateful to have jobs. But some will tell you, as soon as I have an opportunity to get out of here, I’m gone. I think the backlog on retention in companies that treated employee badly during the recession will become a critical issue.
McLaughlin: You talk about a new employee value proposition. What’s different about it?
Ulrich: For about the last two years, I think many executives have been playing whack-a-mole. A business problem arises and they whack at it. They have been reacting to events, usually around costs, keeping customers, and surviving.
Now that the economy is perking up, leaders have to start thinking longer term about their businesses and the value proposition they offer to employees. That means providing more than fair pay and short-term perks, which every other employer will also be giving.
The new employee value proposition goes beyond economic benefits to emotional ones. Employers can provide a sense of identity and a company to be proud of. They can make sure you have people you want to work with and work that you enjoy doing. They should give you the chance to learn, grow, and develop your talent. They might also include having some fun along with the hard work.
McLaughlin: What’s the best way for a leader to assess if an organization is creating meaning for its employees?
Ulrich: I think that assessment begins with the individual. Can people find meaning for themselves? A leader who is able to find meaning should help others find it.
Ultimately, what strengthens you as a leader is helping others grow and develop. That’s because they, in turn, will make your company more productive and make you a more successful leader. That becomes a virtuous cycle, which is what I think we want to see in organizations.
McLaughlin: On the flip side, if an employee wants more meaningful work but has skeptical or resistant leaders, what can that person do?
Ulrich: An employee has three choices: Exit, loyalty, and voice. You could leave. But many people don’t have the option of quitting.
Another choice is loyalty. You just shut off your brain and put in your time. The danger is that, over time, shutting off your brain kills creativity and you end up going through the motions—kind of retired on the job.
The third way is to voice your opinion and find a way to make leaders see that a different management style will help them get what they want. Whether the goal is financial profits or increased productivity, passionate employees can help them get there. That’s not an easy sell, but when leaders get it, they will be able to attract and retain the best employees.
McLaughlin: When you look at how leaders are handling employee practices, what’s the most common shortcoming you see?
Ulrich: One I already mentioned—giving out incentives as isolated events. Leaders need to see that this is a new way of leading that will help them reach their own goals.
I think the original version of the TV show The Apprentice reflects the leadership model that many companies have been following. The boss sits on one side of the desk and determines an ultimate winner. The rest of the contenders end up as losers. If you win, you move to other side of the desk and help select the next winner. That’s what you get with the “war” for talent, which I hope we can get away from.
The problem is that doesn’t build sustainable organizations. Great leadership isn’t about just one or two people. There are many companies with strong leaders but unless you build leadership for the next generation, when you leave there’s nothing left.
McLaughlin: To summarize, if you had to make the business case to a leader for creating a more meaningful work environment for employees, what would you say?
Ulrich: I would put it very simply: improving your talent will increase productivity, and that will improve your ability to meet your strategic goals. Reaching those goals will help you better serve your customers so they will buy more from you. That will also increase investors’ confidence so your stock price will go up. And your company will have a better reputation in the community, so it will be more sustainable.
I’d add that underneath the talent part is a formula for competence. First, do you have the right people with the right skills in the right jobs at the right time? Second, being bright is not enough; your employees must have commitment, which includes ambition and a willingness to work hard. And the third ingredient in the formula is a desire to make a contribution. When those three things come together, talent will lead to productivity then to attainment of strategy, and so on.
McLaughlin: Thanks for your time.
You can find out more about Dave Ulrich at www.daveulrich.com.
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