Putting the 'Why' in Personal Finance - Greater Phoenix In Business Magazine

Alignment is a simple idea that can add 5 percent to a business’s top line and will have implications not before considered.

People seek a purpose-driven life. A successful organization can help provide that through aligning the organization’s purpose from the CEO to every employee. An important aspect of alignment involves helping employees recognize the impact they have.

If an organization could help its employees more fully realize the impact they have through their work, it could help the organization more fully align while, at the same time, helping the employee achieve personal alignment — leading to greater fulfillment and contentment in their lives. It would have a dramatic and positive impact on their financial situation because a fulfilled and contented person is less likely to over-consume material things.

Too big a stretch? Well, why not give it a shot?

The current state of the American worker shows that almost half of employees are not engaged in their work. A lack of a “why” — or purpose — is partly responsible.

Bank statements show us that almost half of Americans couldn’t come up with $400 in case of an emergency.

A study by Bank of America Merrill Lynch showed that engaged employees are more successful financially; specifically, that they save more money. On the other side of that coin, there exists a significant amount of research showing that employees with poor financial situations underperform their counterparts who aren’t in poor financial situations. The findings point to financial stress as the primary reason. Anecdotal evidence indicates there is a correlation between lack of engagement and a poor financial situation.

OK, then, how does an organization address this?

It starts at the top, flows down and then back up.

Every organization has a purpose or a reason it exists. An organization needs to be clear on what that purpose or reason is. What void would appear if the organization was no longer in existence? That’s the organization’s “why.”

Next, it’s important to engage the employees. Do they know the “why” of the organization? This doesn’t need to be a complicated process. It requires a simple question: “Do you understand what we’re trying to accomplish?”

From there, the organization needs to set up a committee comprised of employees from all departments, tenures, backgrounds, levels and locations to integrate the “why” into everything the company does; reinforce the message; and consistently remind everyone connected to the organization of the “why.” There are many titles for such a committee, but it is most commonly known as a values committee. It should meet on a monthly basis.

Aligned organizations commonly promote their values not only externally but internally as well. There are many technologies available for intercompany communication, and these technologies should be utilized for branding the organization’s values and reinforcing behaviors. Engraining the “why” into an organization’s community will help strengthen its effectiveness.

The goal is complete alignment from the CEO down to every employee. It’s been demonstrated time and again through publications such as Firms of Endearment that purpose-driven organizations dramatically outperform other S&P 500 organizations that are not considered purpose-driven.

All too often, organizations and people address the symptoms, not the true problem. An organization that is aligned can’t help but be successful. An employee who is personally aligned is someone fulfilled by his or her work and can’t help but be more financially successful.

This isn’t a quick turnaround story. This is the beginning of converting some of the disengaged employees to engaged employees. In so doing, businesses will likely find those same employees aren’t stuck without $400 cash in the event of an emergency — because they’re in a stronger financial position.

And for the employer, there’s that 5 percent increase to the top line.

George Grombacher is a consultant, podcaster, writer and speaker. He’s a co-founder of the “Figure it Out podcast” and host of the “Money Savage” podcast. His first book, The Farmer’s Rules for Your Financial Harvest, will be released in early 2018. He helps companies design educational strategies for increasing employee participation in retirement plans.