Head and Heart – an Unbeatable Combination

One of the keys to our organization’s success has been our ability to attract and keep a lot of terrifically talented people. As a large, diversified organization that operates in a highly competitive environment, we require a level of talent comparable to that of any organization of similar size in any of the sectors. The fact that over half of our 2500 employees rely on us as the primary source of income in their households further magnifies how essential it is for us to have people who can operate our businesses really well.

There’s a major difference, though, between our requirements and – with some notable exceptions – those of most companies in the for-profit world. For example, in our retail, commercial services, and support functions (e.g. Accounting, IT, Human Resources, Facilities Management, Marketing), we must have a lot of people who have really good business or related functional skills. In addition, though, they must also have a strong commitment to our mission. We must have the “head” and the “heart.” For Goodwill – a not-for-profit social enterprise – that’s an unbeatable combination.

Commitment to mission has always been an important requirement in all parts of our organization, and for many years we’ve also recognized the need for good business skills in our retail and commercial services operations. But early in my career I did not appreciate enough how important it is for us to also have top talent in our support functions. When we finally started hiring people who could elevate the performance level of those functions, we found that they added substantial value to the direct service and revenue generating parts of the organization. From that experience, I concluded that it’s a mistake to try to minimize overhead. Rather, our objective should be to optimize it. We’ve also seen that in any part of our organization highly talented people who are committed to mission enable us to be more effective and more productive. In other words, they enable us to be better stewards of our resources. They earn their keep many times over.

There are a lot of talented people who want more meaning from their work. Hardly a week goes by that I don’t talk with at least one person who has spent the last fifteen or twenty years in a job or career that he or she doesn’t enjoy. They are looking for more satisfaction out of what they do to earn a living, and many of them are hoping to find such an opportunity in the not-for-profit world.

This desire for more meaning is not confined to people in the U.S. Recently, a manager in a Goodwill store in South Korea told me he was 50 years old, had 21 years of retail experience, and had wanted more meaning out of the work he would do for the rest of his life. Goodwill in Korea gave him such an opportunity, and he felt he was now in his “second life.” From what I could tell, he and Goodwill in Korea are fortunate to have each other.

I do not believe that one can find such meaningful opportunities only in a particular type of organization or sector of our society. In fact, I know there are many unfulfilling, unrewarding situations in the not-for-profit world, as well as in other sectors. But I’m certainly grateful that our organization has been attractive to a lot of highly talented people who, with Goodwill, have found a place that’s a good fit with their “heads” and their “hearts.”

Learning from Others

Goodwill in central Indiana is part of a network of 170 locally-based Goodwill Industries organizations around the world.  There is a lot of information-sharing among Goodwills.  We learn a lot from many of our colleagues, and they learn from us.  Each year we host a lot of visitors from around the country who are interested in knowing more about some of our operations and services in central Indiana.  Invariably, they reciprocate when we want to learn more about certain aspects of what they are doing.  It’s a powerful network.

On occasion, the knowledge-sharing crosses borders.  Nine years ago, we agreed to help train persons who were working to establish Goodwill Industries in South Korea.  Since then, we have conducted training in various aspects of our work – mostly in retail operations – for a total of 35 Koreans who have come to Indianapolis for periods ranging from a few days to a few weeks.  The Korean Goodwill leaders have persevered through numerous startup difficulties, adapted U.S. Goodwill methods to their culture and economy, and are now growing at an increasingly rapid rate.

I recently had an opportunity to accompany Goodwill Industries International (GII) CEO Jim Gibbons and three other members of the GII team to Korea to see the work being done there and meet with leaders of Goodwill Industries of Korea as they enter into a new, stronger membership relationship with GII. I was impressed with the substantial progress they have made, the high caliber, talent, and dedication of their leaders, and their ambitious plans for the future.  It was gratifying to see firsthand some of the influence of our Indiana operations nearly halfway around the world, and it was particularly heartwarming to see the vocational opportunities the Korean Goodwills are providing for people with severe disabilities – people who in Korean society have few employment options.

Goodwill in Korea uses the slogan “Not charity, but a chance.” It’s the same slogan Goodwill has used to varying degrees since its early days over 100 years ago, and the oldest and still an immensely significant part of the mission is the same – namely, to provide employment opportunities for people who, because of some significant barrier, have limited options to work.  That was the reason Goodwill was founded in Boston at the beginning of the 20th century, established in Indianapolis during the Great Depression of the 1930s, and launched in Korea during the early years of the 21st century.

As the pace of change in our world continues to increase, it’s worth noting that some things remain constant – among them, the need for people to have the opportunity to develop their talents and be productive, contributing citizens.  Such opportunities are often appreciated most by those who have had them the least – whether they live in Indiana, other parts of the United States, or other parts of the world.  That, too, is a lesson worth remembering.

The Five Basic Principles

Individuals who want to have a good reputation need to follow some pretty basic rules, such as:

  • Don’t lie, steal, or cheat
  • Do what you say you will do
  • Never do anything you wouldn’t want posted on the Internet for all to see

Organizations that want to maintain a good reputation must have people who follow the same basic rules. But organizations also need a culture based on a set of articulated values that, when exemplified in the way people go about their work, result in the desired performance. The culture must be one in which people understand that while achieving the business goals is important, how you achieve them is equally important.

As Collins and Porras reported in Built to Last – Successful Habits of Visionary Companies, companies that have managed to thrive over long periods of time have constancy of purpose and a few core values. But everything else changes over time.

Whatever the articulated values, it is essential to have an effective way to link the values with the business goals and ingrain those values into the culture. In our central Indiana Goodwill organization, the approach we take today started in the early 1990s when we articulated five basic principles we should apply in all of our work:

  • Respect for people. We strive to treat everyone in a respectful manner.
  • Customer satisfaction. We strive to meet or exceed the expectations customers, donors, and users of our services have of us.
  • Informed decision-making. We gather useful information and, to the extent possible, make decisions based on facts.
  • Innovation and improvement. We continuously seek better ways to grow, improve, and increase our impact.
  • Good stewardship. We are responsible stewards of all our resources.

For the next ten years or so, we didn’t do much with this set of basic principles. Then we decided to build our culture around and manage by them. They are incorporated into our recruitment and hiring, new employee on-boarding, and performance development review processes. We take these principles very seriously. We talk about them a lot, and over the last decade these five basic principles have become ingrained in our culture. I frequently hear employees refer to them in conversation.

We’ve also found that it’s a lot easier and more effective to manage according to a small number of values and basic principles than a thick book of rules and regulations. We have to have some of those, but we try to keep them to a minimum.

We’re far from perfect, of course. We have nearly 2500 employees, and all of us make mistakes. Still, with occasional exceptions, our employees apply the five basic principles day in and day out. If that were not the case, I’m quite sure we would not have enjoyed the kind of successes we’ve had over the past decade.

Early childhood development – a key to reducing a lot of social problems

Throughout Goodwill’s history, we have worked primarily with older youth and adults. Yet, the more experience we have and the more we learn, the more I have become convinced that if we are to substantially reduce the incidence of poverty in the U.S., we must dramatically increase our investment in children from the womb to kindergarten.

There is a large body of evidence illustrating the positive return to society of investments in high quality early childhood development programs for children in low-income households. For example, Nurse-Family Partnership (www.nursefamilypartnership.org) is a nurse-led, evidence-based home visitation program that works with expectant mothers from pregnancy until the child is two years old. Three decades of randomized controlled trials have shown incredibly positive long term impact, including:

  • 67% reduction in behavioral and intellectual problems in children at age 6
  • 59% reduction in arrests of children at age 15
  • 72% fewer convictions of mothers when children are at age 15
  • The Rand Corporation found a net return to society of $5.70 per dollar invested in Nurse-Family Partnership

More evidence comes from extensive research done by Professor James Heckman (www.heckmanequation.org), a Nobel laureate economist at University of Chicago. His work has confirmed high returns to society from investments in high quality early childhood development programs for children living in poverty. Professor Heckman emphasizes that many of America’s major economic and social problems – crime, teenage pregnancy, high school dropout rates, adverse health conditions – could be reduced as a result of early nurturing, learning experiences, and physical health from birth to age five – the most economically efficient time to develop cognitive and social skills, both of which are essential for success.

It’s sometimes useful to remind ourselves that no child had any choice about the circumstances into which he or she was born. Some were luckier than others. For children born into situations that lack advantageous educational and developmental resources, we can pay up front to help prevent problems and develop human potential or we can continue to pay much more downstream for public assistance, remedial education, rehabilitation, incarceration, and in all the insidious ways we all pay when economic growth is stymied by a poorly educated, under-skilled workforce.

Some say we have no money to do this. I say we can’t afford not to. Because there’s not enough to pay for everything everyone would like to do, we need to begin shifting more support from programs with marginal return to programs with demonstrated high long term benefits. Doing so will upset some people, but will result in a wiser, more effective use of the dollars that are available. The potential long term benefits are enormous.

Keys to our recent growth and development

During the last five years Goodwill in central Indiana has experienced growth that has been far greater than I would have believed possible.  From 2005 – 2010, a period that included the most severe recession since the 1930s, we added 1,000 employees and now employ nearly 2,400 people.  I would not have imagined such growth.

Neither did I imagine in 2005 that within five years we would have opened a high school that generated so much interest there would be 1,300 prospective students on the waiting list.  And I did not imagine that the fastest growing part of our organization in 2010 would be our ecommerce operations.

While my failure to imagine these developments is certainly profound evidence of how lousy I am at predicting the future, all of these examples have been a result of four factors:

  • A significant increase in our pool of highly talented staff who not only have tremendous skills, but also a deep commitment to Goodwill’s mission and values.  I believe that at some point in the last five years we achieved a critical mass of talent in depth as well as breadth, and those talented people are widely dispersed throughout our organization.  We also had some capital to work with.  When you have good human capital, add financial capital, and align those resources toward a worthwhile goal, good things can happen.  (For those who are directly involved, this can also be a lot of fun.)
  • The development and strengthening of relationships with many who, as individuals or through their organizations, have similar interests and complementary resources.  By working together to leverage those resources in well-defined ways toward a common goal, we can sometimes create new or better approaches to solving social problems.
  • Continuous learning – from others as well as from our own experiences.
  • A strong financial position, without which we would most likely be more risk averse and without which we would not be able to invest in new opportunities that have potential to further enhance the accomplishment of our mission.

Summarized, we have experiences, learn, and make connections.  Those experiences and connections often lead to new ideas and ways of combining strengths or using them in different ways.  And as this process continues to repeat itself, the organization continues to evolve to higher levels with greater impact in the lives of people and in the larger community.