Good Work and Our Times. Report of the Good Work Commission Lucy Parker and Stephen Bevan, July 2011

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1 Good Work and Our Times Report of the Good Work Commission Lucy Parker and Stephen Bevan, July 2011

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3 Contents Executive Summary 5 Chapter 1: Work In Our Times 8 Chapter 2: Meaning and Purpose 13 Chapter 3: The Explicit Deal 38 Chapter 4: The Implicit Deal 52 Chapter 5: What Happens When Work Goes 71 Chapter 6: On The Horizon Future Trends 88 Chapter 7: Creating More Good Work 94 1

4 Foreword Foreword Making work more rewarding for the individual, their organisation and society, is not a new subject, but it is a big one. The larger the frame you put it in, the larger it gets. So from the beginning we recognised that we needed to assemble a range of diverse voices to debate the subject and take a holistic approach to ensure we could examine the detail without losing sight of the wider context. It was therefore enormously valuable to have such a great mix of Commissioners prepared to invest time and thought in what has been a long and rewarding process. We were hugely fortunate to benefit from the business expertise of some of the country s top Chief Executives, combined with contributions from forward-thinking Trade Unionists, leaders in the public sector and the Church. It was a remarkably powerful and exciting forum in which to explore the subject. Our concepts of work have deep historical, social, and often religious roots. The evolution in thinking and practices has developed enormously in the last two hundred years, and in the last few decades, huge developments in technology and globalisation have created not just new ways of working, but new global forces such as the global capital markets and consumer engagement. The importance of the values of good work become increasingly clear as we consider our future in the twenty first century. In the last 20 years it seems that the primacy of financial capital has overshadowed the contribution and investment potential of the people working within or for an organisation. If we can take any true positives out of the credit crunch, one of them is an overdue rebalancing of this view. The recent financial crisis crystallised a lot of profound concerns about how we do business. In times of crisis the how becomes more important from a risk management point of view, but the bigger trend is how good work can be at the heart of high performance organisations. Whether as an individual or as an organisation, it is a key ingredient in creating the winners of tomorrow. If you were ever of the school of thought that the best way to achieve top performance is by focussing an organisation on its profits or return on financial capital alone, then I can only recommend you ask Philip Dilley, CEO of Arup, to outline why the Big Speech by Ove Arup given in 1955 is not just still relevant, but is at the heart of their global success as an organisation. That speech, available on their website, defined so many of the principles of how they want to work and has undoubtedly helped them become world leaders in their industry. Their approach to how they do business has not only made them more profitable but their success has made a direct impact on the cities all over the world that they have helped design and create. This is the value of good work writ large - in their case, actually on the skyline. At the same time it has benefitted the lives of everybody in the firm and the people they deal with. We have had the privilege of many such contributions so it is hard not to be inspired by the opportunity ahead. Another new and powerful force behind the increasing recognition of the value of good work is the growing interest and demand from the end consumer. In addition to the perennial concerns such as price and quality, how something is made, whether it is electricity, food or motorcars, and how that organisation operates is now rising rapidly up the consumer agenda. This is closely linked with the employee agenda and what is generally titled employee engagement. There is a huge amount of work dedicated to this area and we have had some valuable debates on the subject. Central to all of it is the power of belief. The belief that the job you are doing is important and 2

5 Foreword valuable. In short, answering the question, Is there a purpose to what I am doing and can I be proud of doing it well? It does not matter what level or type of job it is - these are not just powerful but universal questions. One of the key differentiators of great organisations and strong leadership is that they set out to answer them. One of the most interesting issues is why more organisations do not pursue the opportunities when the body of knowledge is so strong. This is partly why we wanted to draw on the enormous experience of the Commissioners - so that we could better understand what does not work and what the barriers are to progressing this thinking in different types of organisations. It is also why we conclude with a practical agenda and a framework for discussion which can be used by leadership teams in any organisation. I would like to thank all the Commissioners and their organisations for their untiring support and enormously valuable contributions. We also had fantastic insights from a lot of other organisations and individuals, such as McKinsey, Richard Donkin and the Bishop of London. I would also like to thank Lucy Parker for pulling together the enormous range of work evidenced here, and the writing of this report, and finally I would like to thank Stephen Bevan and The Work Foundation team, who were both the originators of the idea and stalwart supporters throughout. I hope this report inspires both interest and action, as the power of good work must surely be one of the most liberating and creative forces in society. There is an enormous amount of it being done, and the opportunity for greater progress is, I believe, both a challenge and an inspiration. Alan Parker Chair, Good Work Commission 3

6 The Good Work Commissioners Alan Parker Chair of the Commission Founder and Chairman, the Brunswick Group Andy Bond Chairman of Republic and former Chairman of Asda Clare Chapman Director General of Workforce for the National Health Service and Social Care, Department of Health Richard Chartres The Bishop of London Tracy Clarke Group Head of Human Resources and Communications, Standard Chartered Adam Crozier Chief Executive of ITV John Hannett General Secretary, Usdaw Peter Housden Permanent Secretary, Scottish Government Will Hutton Vice Chair, The Work Foundation Jim McAuslan General Secretary, British Airline Pilots Association Peter Sands Group Chief Executive, Standard Chartered John Varley Formerly Group Chief Executive, Barclays Kim Winser Chairman, Agent Provocateur, and Senior Advisor, 3i Carolyn Gray Human Resources and Pensions Director, Guardian Media Group 4

7 Executive Summary Good Work and Our Times Executive Summary This is the report of the Good Work Commission. The Commissioners are a group of individuals with a great breadth and depth of experience in leading organisations across all sectors, including business, government, the unions, the church, media and the voluntary sector. They believe that good work is a benefit to employees, employers and society alike and that it is possible to make it more rewarding for all involved. Flowing from that, the purpose of the report is to explore what makes good work and how to create more of it. It is based on two key assets: the great breadth of experience and views of the Commissioners and the considerable body of research produced by the Work Foundation over the past decade. The Work Foundation presented a set of eight Provocation Papers to the Commissioners to inform their thinking and stimulate debate. The report draws heavily on those papers and over twenty other studies produced by the Foundation, as well as a wide range of literature produced by others in the UK and elsewhere. Personal perspectives from the Commissioners are incorporated throughout the report, reinforcing and accenting the research-based narrative about the nature of good work. The aspiration is for the report to be useful for people who have leadership and management roles in organisations, prompting reflection about how effectively their organisation is dealing with these issues and providing practical suggestions about how they could take it to the next level. The first chapter of the report, Work and Our Times, sets the context. The significance of work is an enduring theme. Throughout history, cultures have been shaped by the nature of work and the tools which people have at their disposal. The subject has been given new emphasis in our times by the information revolution, which has transformed so much so quickly about the way in which individuals, businesses and society live and work. In recent years too, the impact of the financial crisis and the global recession has shaken assumptions about the purpose and value of business to society. And even beyond the financial crisis, there is widespread distrust of leading organisations and leaders that crosses business and social sectors. Though this was not the impetus behind producing the report, it has highlighted the importance of articulating the principles of meaningful and good work. The chapter also draws in the major global trends, from technological change to the rise of the consumer, which are having a direct impact on the workplace today and which create the backdrop this report. The chapter on Meaning and Purpose argues that finding meaning in work matters to people and is intrinsic to the nature of good work. Indeed, it is impossible to think of good work which people find meaningless. Our proposition is that this principle is universal; it applies to everyone whatever kind of job they do and wherever they fit an organisation. The challenge for employers is to find new ways of responding to that aspiration for their entire workforce, rather than just for a lucky few. Meaningful work is made up of a subtle mix of factors which is not the same for everyone and can change over someone s lifetime. While leaders cannot provide meaning, as such, they can provide the conditions for people to do that for themselves by clearly setting out the purpose of the organisation. And there are practical ways to reinforce the connection, including through ownership models and giving employees a voice in the organisation, through to designing jobs and workflow to make work more worthwhile and rewarding for both the organisation and individuals involved. 5

8 Executive Summary The Explicit Deal is what people sign up to when they take a job. It is central to any employment contract, but it is not the whole employment relationship. Similarly, while pay is an essential element of good work, it is by no means the whole deal or even the primary motivator. How pay is allocated, for instance, is as important to people as absolute pay. One of the most significant factors influencing the employment contract today is the enormous momentum behind the trend for greater transparency. The desire for a sense of fairness about pay, especially the gap between the top and bottom levels, is fuelling the trend. But it encompasses more aspects of organisational culture than pay; for instance, performance management, where the challenge of tackling poor performance is as significant as rewarding strong performance. Our view is that there is a real opportunity for employers to embrace the trend towards transparency and actively work with it as a mechanism to establish fairness and build trust. Though recent years have seen a decline in the number and membership of unions, they continue to play a significant role in the workplace. There is a broader negotiating agenda than ever before, reaching beyond pay, grievance and discipline, to cover skills, diversity and flexibility because those are central to the concerns of today s workforce. Among the progressive unions, the trend has been moving away from a sometimes adversarial position to a dialogue based on defining mutual benefit a more modern paradigm that is relevant to the employer-employee relationship, whether or not it falls within formal union negotiations. The Implicit Deal explores the many other aspects of the employer-employee relationship which add up to the day-to-day experience of work. This chapter argues that making the connection to the core purpose of the organisation is the key to employee engagement. That is what elevates employee engagement programmes above the transactional level into adding value to the business and to employees. There are multiple facets to creating a committed workforce, from giving people autonomy in their jobs to a voice in the organisation; from matching qualifications and skill levels to the job in hand to the capability for fostering innovation. One of the most significant modern factors is the growing desire for flexibility, which is coming from both employees and employers. The complexity of these inter-related topics requires thoughtful orchestration; it is not possible to rely on them occurring spontaneously. The competence of front line managers is a decisive factor in the culture and performance of an organisation: they are the conduit for communicating purpose and the day-to-day experience of work for employees good and bad is largely governed by how they carry out their role. Therefore how they are selected, trained and equipped is vital and they need to know their responsibility for making it a good place to work. The alignment between employees experience of good work and successful business performance can be measured in a number of different ways including, on one hand, the health and well-being of the workforce leading to reduced absenteeism and, on the other, customer satisfaction driving sales growth. The investment in time and resources required to create an engaged workforce is a win:win a business case for employers in improved performance and productivity; a more meaningful and rewarding experience of work for employees. In this report on the nature of work, we have chosen to include a chapter on the subject of What Happens When Work Goes. This report argues that a company s approach to managing job loss can be seen as the acid test of its claim to be a good work organisation. The individual and societal cost of unemployment is a powerful expression of the value of work itself. During the downturn of recent years, there have been many examples of employers and employees working collaboratively to find innovative ways of mitigating the most damaging effects of redundancy. Apart from the practical result of protecting jobs for the long term, those instances exemplify many of the principles of what makes up good work, such as shared decision making, flexibility, transparent communications. 6

9 Executive Summary Employees and employers alike recognise that, these days, guaranteeing job security is unrealistic. However, skills are increasingly becoming a passport to employability in the modern labour market and employers have a role to play in helping to ensure their people are equipped with the kinds of transferable skills which will be their best asset in the future. On the Horizon looks at the trends which are likely to influence the workplace in the coming years. Growing globalisation and the interconnectedness of markets, growing technological innovation and the widespread use of it in and beyond the workplace, and the growing power of the consumer are forces we recognise today, and they are all set to intensify. For people leading organisations public or private, large or small the challenge is to recognise how those great macro-trends will translate into the workplace and directly affect the experience of work. Creating More Good Work is the final chapter of the report. The experience of the Commissioners, and many other experts in the field of employment, is that people are becoming increasingly vocal about what they want from work. The report aims to turn the insights into a provocation for action. Therefore, in conclusion, we have set out a series of questions that provide a framework which can be used in any organisation to prompt discussion about how to make work more rewarding for employer and employees. The framework aims to help people who lead organisations and teams to formulate their own answer to the questions, Why is this a good place to work and what can be done to make it better? 7

10 Work In Our Times Work In Our Times The chapters which follow make the case for more good work but, by way of introduction, we begin by setting out the context which is influencing work in our times. Work and the human condition The importance of work in our lives is an enduring theme, of course. The history of civilisations has been bound up with the nature of work in society and even defined by the tools which people have at their disposal. The evidence can be traced back to the agrarian communities of 10,000 years ago, when the invention of new tools and new ways of producing and storing crops enabled mankind to make the radical shift from the lifestyle of hunter gatherers to farming and fundamentally changed the way we live. It happened again during the 18th and 19th centuries when steam-based mechanisation created the basis for an industrialised society transforming the nature of work and life once more. So, as Richard Donkin 1 puts it, since the start of human evolution, the tools we have invented have played a vital role in extending our ambition and stimulating creativity. Today, Donkin and others argue, we are in the midst of a third revolution the information revolution. Once more, born out of technological innovation, new tools are bringing huge changes into the workplace, which prompt a reexamination of what work means in our times. Today s crisis of trust There is also a contemporary context for this report. Since the financial crisis, some of our basic assumptions about how the economy works and the purpose and conduct of organisations have been shaken. There are immediate economic consequences of the credit crunch and recession, which are visible in higher levels of business failure and unemployment across all developed economies, along with severe cuts in public spending and rising taxes to follow. But the significance of the crisis in relation to the workplace reaches still further than that. It has also exposed issues of business purpose and leadership, and of morality, transparency and trust. The values of work are in the dock. How can work which leads to such consequences be thought of as good work? How can the judgement of such leadership be trusted? After decades during which so much economic activity has been driven by the rise of the capital markets worldwide, the primacy of shareholder value as the dominant definition and benchmark of successful companies has been challenged. Some commentators think everything will return to normal as the spectre of recession fades and the desire for a swift return to economic growth intensifies. Others take the view that the rules have changed forever and new standards of public accountability and regulatory oversight need to be applied. It is still not clear how it will play out, but the near collapse of the banking system will have been a watershed moment for this generation: there was one set of assumptions before it and another after it. These are the same few years which have seen BP s environmental disaster in the Gulf of Mexico, the expenses scandals in Westminster and the loss of confidential data by government departments, and apologies for breaches of trust from the highest level of church organisations. They have all led the headlines repeatedly, building on each other and reinforcing a common culture of distrust in the leaders of our major institutions. This erosion of confidence goes way beyond cynicism about commercial 1 Donkin R, Work Futures, The Future of Work: Provocation Paper 1, Good Work Commission,

11 Work In Our Times organisations which are driven by maximising profit. They illustrate the scale of today s challenge to reestablish trust, and re-state the purpose and values of the organisations we work in throughout society. Though the financial crisis began to unfold at the time the Commissioners first gathered, it was not the reason for taking on the task. But the events of these few years have thrown into sharp relief the relevance of articulating the principles of good work. Global trends In painting the backdrop to this report, we should sketch in broad brushstrokes the part played by the forces of globalisation as they relate to work. The financial crisis itself powerfully demonstrated how the business sector is woven tightly into a fabric of interdependence around the world. The reality is that many businesses, large and small, are now trying to compete and grow in the context of a global marketplace. For many large businesses, customers and investors are now global, but so too are work forces and supply chains. The story can be told through how the operations of many familiar British corporates have transformed over the past ten to fifteen years. Rolls-Royce, for instance, has grown from a Midlands manufacturer to a global player with almost 40,000 employees worldwide, 40 per cent of them outside the UK, compared to only 7 per cent 20 years ago. As BP s recent troubles highlighted, 40 per cent of the company s shareholder base is in the US, as are 40 per cent of its employees. KPMG, a UK accountancy firm founded in the 19th century, has expanded into 146 countries to meet the needs of its increasingly international customers. Marks and Spencer once built its reputation on its British produced products and faced protests when it first extended its supply relationships beyond the UK in the 1990s, whereas today it cites an integrated international supply chain as key to its growth plans. Many well-known household names in the UK are owned outside the country, and are now inherently part of the global strategy of other organisations. Abbey National, once a consumer name on the High Street in Britain, is part of Spain s Santander Group. Boots is part of the Allianz Boots group, now head quartered in Switzerland. British Airways has merged with the Spanish airline, Iberia. The energy generator and supplier, npower, has been acquired by RWE based in Germany. Corus and the once mighty British steel industry is bound up in the fortunes of the Indian based Tata Group and the global steel industry. The requirement to operate on a global platform is not the preserve of big companies alone. All over the country smaller businesses are adapting fast. Take Pennine Healthcare in the Midlands: it started as a local family business in the 1960s and has evolved into a global manufacturer of healthcare products with customers from New Zealand to the Middle East, competing over the internet for contracts with companies based in South Korea. Or Meachers in Southampton: a local trucking firm which has transformed into a sophisticated international logistics business, with established partners in China and IT systems that can track the goods across the world. These examples are simply fragments of the broader picture of globalisation in the business world a sign of our times. 2 Yet, it remains true that for many employees in the UK, and indeed many employers, their own direct connection to a global market is not immediately obvious to them. It may be that the horizon of their workplace and their customers are limited to the neighbourhood they are based in because they are in local service jobs anything from hairdressing to nursing, car mechanics to graphic design. The forces of globalisation are relevant to them, nevertheless. The sustainability of their jobs is ultimately dependent on the ability of people in the local area or the government of the day to pay for their services. Indeed, the most deprived communities in the UK where people are trapped in a third generation of worklessness prove the point. On the surface, these are the most isolated from the influence of the global capital markets. But the lack of work entrenched in those communities has been caused by the 2 FutureStory, Talent and Enterprise Taskforce, with Department of Business, Innovation and Skills, Department of Children, Schools and Families, and Centre for Cities,

12 Work In Our Times significant shift of traditional UK industries to elsewhere in the world, whether in steel, shipbuilding or car assembly. Genuine regeneration in these areas is dependent on the creation of new work, often requiring new skills, in businesses and industries which can thrive in today s global markets. Employers in developed economies cannot succeed by competing in low value products and services, and on low wages. So sustainable employment will need to come from higher value work and higher value skills. In the UK, growth and new jobs will be driven by the knowledge economy. Over the past ten years, for every new job created in the more traditional industries, twelve have been generated in the knowledge economy 3, encompassing sectors such as the creative industries, high-tech manufacturing, telecommunications and low carbon technologies which indicate where the jobs of the future are likely to come from. Technology is one of the forces driving globalisation and changing the shape of work for many people. Increasing automation is replacing many of the semi-skilled and even skilled roles of the past, from bank tellers to booking agents. And it is increasing the requirement for non-routine skills, from analysts to customer service. For individuals in their day jobs, the arrival of new technological processes can bring contradictory effects. The constant push to take products or services to market ahead of others, and to achieve that with a lower cost base, can create a relentless culture in business, putting pressure on working conditions and rewards. For some, technology expands the opportunity for autonomy and creativity. For others, it reduces discretion because jobs and processes are monitored to a degree of detail never possible before. In some types of jobs, it offers high levels of fulfilment and challenge. In others, it leads to greater intensity and stress, with evening and weekend working, and no license to turn off the blackberry: the always-on technology creating always-on jobs. Many employees are interacting with wider and wider circles of people which for some people represents broader horizons and, for others, makes for an unsettling boundariless world, breaking up a sense of immediate community and leading to insecurity. The arrival of new technologies has established a new literacy in the workplace. Employees are required to have basic ICT skills, even in jobs which are not traditionally associated with technology such as waiters, shop assistants or lorry drivers. Patterns of work are altering: e-commmerce and services are changing the skills and resources needed in retail businesses; computer aided design enables manufacturing business to pass projects around the world on a 24 hour clock. In all sectors, from advanced manufacturing to filmmaking, from banking to healthcare, technological innovations are changing how things are done and what it possible. New technologies are driving consumer markets too and consumers are increasingly in the driving seat. Indeed, the way society engages its citizens today is as consumers, rather than producers. And as consumers, we continuously demand higher quality goods and services, we expect to shift provider when unsatisfied and because of globalisation we have got used to lower prices. Companies are using novelty to win the hearts and minds of consumers, for example, with everything from new apps for mobile phones to design-your-own-trainers. That, in turn, drives the need for higher levels of skills and flexibility from employees and a culture of speed and customer responsiveness in organisations. Over the past ten years, there has also been a transformation in how individuals entertain themselves, acquire information and communicate outside the workplace. Through search engines and open access tools, blogs and social networking, people have access to an enormous wealth of information and increasingly they expect to get it for free and on the move. As important, they know they can author and publish content themselves, which is then available worldwide. It has created a much more outspoken culture than in the past. People expect to be able to make their voice heard and to innovate directly themselves. 3 How cities can thrive in the changing economy? The Work Foundation, Ideopolis Final Report, July

13 Work In Our Times Yet we should pause to remember that we are them. Outside work, we are the consumers that are changing the face of work. So the values we express in our lives as consumers feed back into our expectations and aspirations for the places we work. So, like the agrarian and industrial revolutions of history, the digital tools and technologies at our disposal are creating the revolution of our times and radically changing the way we live and work. What becomes clear is that old assumptions do not always apply any more and there is a need for us to construct new ways of operating and new paradigms suited to our changing times. There are enormous and complex forces acting on the kind of work we do and the places we work in. Though they are sweeping macro-trends, they directly affect the personal experience of work. They help to provide a contemporary interpretation of the eternal theme of how work contributes to an individual s sense of self and social value. The exceptional financial turmoil and crises of leadership of the past few years; global interconnectedness; the many new forms of technological tools available to us; our own rising expectations as consumers and citizens all require us to look afresh at the meaning of good work to employers, employees and the society in which we live. Commissioner perspective from John Varley, formerly Barclays on the strategic issue of trust Given what we ve all lived through over the last two to three years, with the banking crisis leading into recession in many parts of the world, there s an intensification of the need for worth and purpose and value in work. Employees want to feel that the organisation they work for is trusted. Indeed, it s difficult to see how organisations can offer good work in circumstances where trust has broken down. In my conversations with customers, I ve noticed that they often draw a distinction between banks and the bank employees who work in their local branch. They regard the one as an object of suspicion, but the other as a friend. I see this through customers who have written to me when things have gone wrong. They will speak with warmth about the cashier in their local branch, saying that she s doing her very best to help and she s only applying the policies which you impose on her. They distinguish the organisation as represented by the leadership from the human face of the organisation they encounter physically when they walk into a branch, or electronically when they talk to a call centre. It strikes me as very significant that five years ago many people would have said that if the work of a business was legal and profitable, that was sufficient justification. Today it s clear that legality and profitability, in the absence of social contribution, are regarded as insufficient. That s a big shift over the last few years and it seems to me to have been catalysed by the credit crunch. When I look at the contribution of big business today, it s clear that the restitution of trust is an important strategic issue. It s especially relevant for the banking industry, but it s also part of a more general malaise about big business. An organisation that wants to offer good work has to be sensitive to this change in expectation. Employers who show insensitivity here will find it increasingly difficult to recruit good people or hold good people and maintain trust with their customers. 11

14 Work In Our Times Commissioner perspective from Kim Winser, Agent Provocateur and 3i on global markets One key factor that matters for our future is the global market. The world has become a smaller place in so many business areas and that s not likely to change. I have worked across many countries in different businesses and I see how globalisation is having a serious impact in the marketplace, in our lifestyles and, of course, on the businesses themselves. Your competitors are no longer just the people down the road who you used to know by name; they are people you ve never even heard of they could be Chinese, or Japanese, American, or Swedish. Your business is in a much more vulnerable position because your competitors are people you don t know and you can t predict. That unsettles many people. For those who are very determined, and love a challenge, it probably incentivises them more. But for the majority, it probably scares them a little. We need to realise there are things which the Chinese, for example, do well and there are reasons why they do them well. But there are also things British people can do really well. We need to stop the global market being a subject in which we lack knowledge or talent. We must not fear our new competitors or try to emulate them. We need to understand them and their strengths, but then use that to reflect on our strengths and points of difference so that we can take up the market opportunities with confidence. We must turn what looks like a negative, with the growing threat of global competition, into a positive result for UK business by facing the challenge with good intelligence and understanding, and through the development of innovative talent and renewed energy. 12

15 Meaning and Purpose Meaning and Purpose People want their work to have meaning. When people speak of the meaning of work, typically, they use the phrase to indicate more than the value of simply having a job. What is meaningful to an individual, by its nature, is subjective and personal to them, therefore not easy to generalise about. However, the concept and what it encompasses has been studied and written about many times over the years. The search for meaning The idea that work fulfils a profound human need has a long history and has often been the theme of the great philosophers. Immanuel Kant said: If a man has done much he is more contented after his labours than if he had done nothing whatever, for by work he has set his powers in motion. 4 In other words, work has the power to animate us. Taking a view across the modern studies of what makes work meaningful, what quickly comes across is that, though the categorisation or emphasis may alter, the core elements remain very consistent and probably recognisable to most of us. The essence is captured by Studs Terkel s famous words from the foreword of his 1974 book on work: Work is about a daily search for meaning as well as daily bread; for recognition as well as cash; for astonishment rather than torpor; in short, for a sort of life, rather than a Mondayto-Friday sort of dying. 5 Jesper Isaksen 6, for instance, identified eight routes through which employees construct meaning despite what he called the drudgery of repetitive work : The possibility of attachment to the workplace or the work The possibility of engaging in social relations at work and caring for others The feeling that the work is useful and a necessary part of a larger meaningful project The feeling that the work accomplished is important to the well-being of other people The possibility of learning and the pleasure of finding fulfilment in one s work The possibility of contributing to the development of work procedures and the improvement of working conditions The experience of autonomy that gives a sense of freedom A sense of responsibility and pride in one s work. The organisational psychologist, Estelle Morin 7, identifies six key categories of meaning in work which have emerged from studies since Her analysis reinforces the idea of consistent themes, which according to her are: 4 Kant, I. Lectures in Ethics. Trans. P. Heath, Cambridge University Press, p Terkel, S, Working: People Talk All Day About What They Do All Day and How They Feel About What They Do. Pantheon, 1984; first published Isakson J, Constructing Meaning Despite the Drudgery of Repetitive Work, Journal of Humanistic Psychology, 40(3), , Morin, EM, The Meaning of Work in Modern Times, 10th World Congress on Human Resources Management, Rio de Janeiro, Brazil, August, 2004; (speech). 13

16 Meaning and Purpose Social purpose doing something which is useful to others Moral correctness the justifiability of work processes and results Achievement-related pleasure enjoying one s job and developing one s potential Autonomy the use of skills and judgement to solve problems and make decisions Recognition adequate salary and affirmation Positive relationships trust and interesting contacts. Especially at a time when unemployment is high and economic stability is fragile, some may say that philosophical reflection and in-depth study is unnecessary. The matter is very simple: it all comes down to pay. Certainly, at its most basic, people need to earn a living: work means they can pay the rent, buy their food and to pay their way in the world. But while financial reward is intrinsic to the meaning of a good job and to the motivation to work, the evidence is that it goes hand-in-hand with other factors. The balance between different motivations has been well documented down the years. When a Work Foundation study asked people if they found their work to be a means to an end, 51 per cent agreed and, in the same survey, 69 per cent said their work was a source of personal fulfilment, and 78 per cent that it was stimulating and, or challenging. 8 There was a very strong resistance, 86 per cent, to the notion that work was meaningless. This pattern has been echoed in international investigations of the meaning of work. A major study of 15,000 workers from the US, UK, Japan, West Germany, Sweden and Israel found that, although different social norms prevailed in different countries about the work ethic, the economic rationale for work was held in a similar balance. 9 Just over half of the respondents identified financial reward as the pre-eminent motivator, while just under half favoured the expressive characteristics, including interest, friendship, identity and a chance to be useful. Asked about their work goals, all respondents put pay towards the bottom of their priorities, with opportunities to learn new things, interpersonal relationships and promotion at the top of the list. All this suggests that, for many people, pay is a necessary but insufficient driver of fulfilment at work. In 1955, two sociologists, Nancy Morse and Robert Weiss, first asked the question, If by chance you inherited enough money to live comfortably without working, do you think you would work anyway? A total of eighty per cent answered, Yes. 10 The question has been repeated by others in large scale research exercises during the 1960s, 70s and 80s, with similar results. 11 It is not surprising then that it is common for lottery winners to choose to carry on working. As Graham Forrest, the MD of a snuffmaking company in Cumbria who won 2.7 million in 2009, saw it like this: I left school at 15 and went to the company as a trainee manager. I ve worked my way up. I ve given my life to it. There s been some good times and bad times, so there s no way I ll be giving it up. I wouldn t know what to do with myself. 12 In practical terms, employees desire to find meaning in their work matters to employers because it is so closely associated with motivation and motivation has a direct relationship to the commitment and discretionary effort people are prepared to put in. The grandfather of organisational behaviour, Frederick Hertzberg, spent many years trying to pin down the fundamentals of employee motivation and performance, beyond the purely economic. 13 His work focused on the differences between what he called the extrinsic characteristics of work such as pay and working conditions and the intrinsic aspects of jobs such as variety, challenge, discretion and autonomy from which employees draw most 8 The Work Foundation, The Joy of Work, MOW International Research Team, The Meaning of Working. London: Academic Press, Morse, N. C. and Weiss, R. S,. The function and meaning of work and the job. American Sociological Review, 20(2), , Gini, A, My Job Myself: Work and the Creation of the Modern individual, Routledge, Snuff maker who won 2.7 million on the lottery will keep working, Daily Telegraph, 31 March, Herzberg, F, The Motivation to Work, New York: John Wiley and Sons

17 Meaning and Purpose of their satisfaction and motivation. Towards the end of his career, Hertzberg distilled his core message into an elegantly simple phrase: If you want someone to do a good job, give them a good job to do. 14 Businesses have an interest in knowing more about what motivates their employees to do a good job for them. The starting point is recognising that it goes beyond a simple response to financial incentives. Motivation is made up of a complex and moving mix of elements. As Professor Furnham says: People s motivation and their needs change over their lifetime. I say to businessmen, Would you rather have three thousand pounds worth of cash or a week of holiday? and they will say a week s extra holiday. You say that to my students and they will say, Three thousand pounds cash. 15 In recognition of how personal priorities change, an increasing number of employers are offering flexible benefits packages. In some so-called salary sacrifice schemes in which employees can buy or sell annual leave it is common to find that younger staff sell some of their leave entitlement to generate more cash, while older workers sacrifice cash to buy more annual leave. Time, it seems, becomes a more valued commodity as people get older. Another example of how needs and values change over a lifetime was highlighted in research carried out by The Work Foundation and the Future Foundation. 16 The study found that both younger and older employees attached higher importance to the ethical performance and social responsibility of their employers than those in middle age, whose primary concerns were about flexibility of working hours, rewards and employment security. For the younger and older age groups, the ethical issues were of sufficient importance to influence their decisions about staying in or leaving the job. As Commissioner, Adam Crozier, recognises, priorities change at different stages of life: Adam Crozier, ITV People spend vast amounts of time at work and it s a big part of their lives. And I think everybody wants that to mean something. But what it means is a very individual thing. For some people the meaning is, I just work to get money. For others it s, I m doing something I believe in. Or, I m doing something I love. Some want to be sociable; meeting and working with other people. And over a career, it s often all of those things at various times. It used to be that people went to work somewhere and stayed there most of their working lives, but that s less the case now. Now people go through stages more, and the meaning of work changes as the stages change. Someone might need to get a job right now because they need some money to tide them over, so others things matter less to them. Or, someone is looking for a career path ahead of them. People who are in their fifties might be preparing for semi-retirement and be looking at the type of work they would have never even considered in their thirties. So, as you go through life stages, your attitude and what your work means to you changes. 14 Herzberg F, Workers Needs: The Same Around the World, Industry Week, 21 September 1987, p (Accessed 24 August, 2010). 16 Bevan S and Wilmott M, The Ethical Employee, The Work Foundation/The Future Foundation,

18 Meaning and Purpose As an employer, it is important not to assume you know what your employees priorities are, but to take the trouble to investigate. For instance, a study which looked at why women pharmacists in the NHS were leaving work, found that managers clearly understood the motivations of their early years in work, but had assumed that when the women returned to work after having children, what they wanted was part time work and pin money. The study uncovered that, in reality, what they wanted was to recapture momentum in their careers and it was this mismatch in understanding that was causing female pharmacists to leave. 17 Similarly, research undertaken by Commissioner, Clare Chapman, illustrated how the assumption that is typical in so many large organisations, that what people are looking for is to move up through the levels of the career structure, is not always accurate: Clare Chapman, National Health Service We did an interesting piece of work when I was in retail to understand more deeply what staff wanted from their work. It s easy to assume that what you want from work is what everybody else wants. It was a sobering lesson to find that wasn t true. There were large numbers of our staff who wanted participation and not promotion, and their expectations of the workplace were very different. If we carried on treating everyone as though they wanted promotion we ran the risk of completely missing the point in terms of what good work looks like to them. We changed our practices quite a lot when we realised that, for a significant proportion of our staff, job enrichment was a far better motivator. People s needs from work have changed in the course of the late 20th and early 21st centuries. The work of the American sociologist, Ronald Inglehart and the World Values Survey 18 which he pioneered, shows how the priorities for citizens in countries which are in the process of industrialising are economic growth, security, and faith in the power of science and technology. But these are not the priorities of people in countries like the UK that have already reached a state of post-industrialisation. In these countries, post-materialist priorities such as self-expression and the quality of life have become progressively more pronounced in the culture as a whole. This, in turn, has a bearing on motives and perceptions of what constitutes rewarding work: There is also a gradual shift in what motivates people to work: the emphasis shifts from maximising one s income and job security towards a growing insistence on interesting and meaningful work [and] we find a growing emphasis on more collegial and participatory styles of management. These findings are echoed in research conducted at Harvard University by Howard Gardner and his colleagues, who talk about the concept of flow being applied to work much as the notion of being in the zone is used by athletes. People in a state of flow feel they are engaged in a creative unfolding of something larger and meaningful. Some of us might recognise flow experiences through those activities in which we become totally absorbed and which seem to make time stand still, whether at work, or involved in hobbies or service. This informs what Gardner and his team describe as good work : 19 Doing good work feels good. Few things in life are as enjoyable as when we concentrate on a difficult task, using all our skills, knowing what has to be done. In flow, we feel totally involved, lost in a seemingly effortless performance. Paradoxically, we feel 100 per cent alive when we are so committed to the task in hand that we lose track of time, of our interests 17 Bevan S M, Buchan J and Hayday S, Women in hospital pharmacy, IMS Report 182, (Accessed 24 August 2010). 19 Gardner, H, Csikszentmihalyi M, and Damon, W, Good Work: When Excellence and Ethics Meet, Basic Books,

19 Meaning and Purpose even of our own existence. But it also happens surprisingly often at work as long as the job provides clear goals, immediate feedback, and level of challenges matching our skills. When these conditions are present, we have a chance to experience work as good that is, something that allows full expression of what is best in us, something we experience as rewarding and enjoyable. This description clearly aims to express an almost transcendent relationship with work. There is no suggestion that all workers in developed Western economies either reach, or aspire to, this higher plane of experience. Yet, Gardner s study, the World Values Survey and other related investigations all point to a growing sense that these intrinsic and expressive characteristics are becoming an important part of what a growing number of people are looking for from work in our society today. Purpose and leadership Understanding then that people are seeking meaning in their work on top of all the other things we expect from leaders in modern organisations should we now add the requirement that they provide meaning for their staff? The answer must be an unequivocal, no. Indeed, they cannot do so, because meaning is individual and subjective. However, leaders have a vital contribution to make. Leaders can animate the purpose of the organisation. They set the context in which employees can build their own sense of meaning from their work and help them to understand the part they play in that larger organisational purpose. Commissioner, John Varley, sees it as the responsibility of leaders to describe purpose and make it relevant to their employees: John Varley, formerly Barclays Leaders have to convey business purpose, a sense of direction and a sense of vision. These things are different from meaning. Meaning is created from employees empathising with business purpose. By that I mean, if they deliver on purpose, employees feel their professional lives are meaningful. As the leader of an organisation it is unhelpful to define meaning because meaning is personal for each individual employee. But what isn t personal is the collective direction of the business, and its purpose as an organisation. Commissioner, Peter Sands, as Chief Executive of Standard Chartered, is another leading voice in the banking sector who sees clarity of purpose as a central leadership responsibility. He sees it as essential to the challenge of restoring trust which faces the financial sector today: 17

20 Meaning and Purpose Peter Sands, Standard Chartered Bankers must play our part in restoring trust in the financial system and in supporting the recovery in the real economy. This requires honesty and rigour in acknowledging what went wrong in the financial crisis; it requires a clear articulation of the essential role banks play in the economy; and it requires carefully prioritised actions by regulators and banks themselves. The onus, however, must be on banks to move swiftly to re-establish confidence and trust with all its stakeholders, but particularly its employees and customers. The banking industry has already taken some important steps in raising capital and tightening credit standards but more work is needed. At its most fundamental, this means continuing to build businesses that have a real sense of purpose, that can attract and engage talented people and that can support our clients and customers buy homes, start businesses and invest for the future. A recent study by The Work Foundation has explored in some depth, through over 250 interviews, how outstanding leaders strive to communicate both vision and purpose. 20 The research centred on what leaders themselves believe leadership to be and how they practice it, with perspectives from both senior leaders and their direct reports in six major companies, including Tesco, Unilever and Guardian Media Group. The effectiveness with which leaders helped to bring meaning to life was identified as one of the important attributes which differentiated outstanding leaders from those who were merely good : Outstanding leadership enables a strong and shared sense of purpose across the organisation as sustainable high performance comes from a shared determination to overcome challenges for the long-term benefit of stakeholders, staff, customers and society. Outstanding leaders tangibly demonstrate a sense of purpose in their work, bringing meaning to what they and others do. Contributions are connected to the organisational purpose, people are respected for what they offer and what they aspire to so that they feel purpose-full in their work. Outstanding leaders find an emotional connection for people; they focus on passion and on ethical purpose. In practice, the research found that many leaders recognise the power of conveying the purpose of the organisation and are skilled in articulating it and where employees fit into it. As one leader put it: I always have the concept of a journey. To me, leadership is about engaging with people to work out how to take that journey; getting clarity around it and being able to articulate it clearly enough for people. Then engaging and motivating people to move the organisation on from where we are today. It s trying to give people the reason; the catalyst to change what they re doing today. Another highlighted the importance of personal authenticity in how the purpose is conveyed: Leadership is the ability to explain something and to engage and motivate people to participate in it. It is greatly helped by personal characteristics. So if you re believable if people perceive you to be honest and fair your ability to engage and motivate people on that journey is helped. 20 Tamkin P, Pearson G, Hirsh W and Constable S, Exceeding Expectation: the principles of outstanding leadership, The Work Foundation,