Passion is the most valuable asset in business

The conventional concept of business dictates that if we have financial, human, intellectual and technological capital, all we need is a good roadmap to pull them together. 

Paul Alofs, an award-winning innovator whose career highlights include running 500 North American Disney stores, HMV music stores and BMG Music and author of the book Passion Capital, believes otherwise. He argues that business is failing to notice its most precious plus point. And this asset is not financial capital, knowledge capital or human capital.  It’s passion capital, a wealth that Steve Jobs of Apple, John Lasseter, co-founder of Pixar, and Isadore Sharp, founder of the Four Seasons Hotel chain, have spotted and harnessed to their advantage. They are passion capitalists — change leaders who created passion capital for their respective career, company, cause or country.

Creating passion capital involves taking a strong emotion and spinning it into a helpful benefit. “It is used to build transformational success, and when expressed as a formula it would look like this: Passion Capital = Energy + Intensity + Sustainability. It is a brand-new asset class, and the foundation upon which all other forms of capital are built,” Alofs declared. He posited that it is the alpha form of capital that is created by applying seven critical principles, namely creed, culture, courage, brand, resources, strategy, and persistence.

• “A man’s action is only a picture book of his creed.” English writer Arthur Helps’ quote summarizes the essence of a creed — a focused statement of beliefs that creates clarity, unity, and inspiration. It is the DNA of passion capital, the inspiration, which comes from personal experiences, successes and failures, mentors and family, community, faith, ambition, and zeal. It answers the question: “What do we believe?” Developing a creed is the first and most important building block of passion capital. This John D. Rockefeller creed is a fine example. It is where he built his business empire: “I believe that every right implies a responsibility; every opportunity, an obligation; every possession, a duty. I believe that love is the greatest thing in the world; that it alone can overcome hate; that right can and will triumph over might.”

• “Culture is the process by which people become all that they were created capable of being.” This passage by Scottish philosopher Thomas Carlyle aptly captures the idea that successful cultures are built with a long-term commitment to performance and to basic human values like loyalty, respect and passion. Great cultures are based on clear, concrete principles such as the golden rule. “Our actions, not our words, drive performance-based culture, ” Alofs stated, as he offered these eight rules for creating a right culture that reflects our creed.

1. We should hire the right people who have passion and commitment first, experience second, and credentials third.

2. Once we have the right people, we need to sit down regularly with them and discuss what is going well and what isn’t. Communication is key, as we critically take note of our victories, just as we analyze our losses.

3. Look after the destructive weeds, like the whiners. They aren’t necessarily public with their complaints, and don’t stand up in meetings and articulate everything they think is wrong with the company. Instead, they move through the organization, speaking privately, sowing doubt, and strangling passion.

4. Promote a “work hard, play hard” ethic.

5. Create a culture that supports ambitions, big steps and powerful beliefs.

6. Celebrate differences knowing that great cultures are built on a diversity of background, experience, and interests, which generate the energy that is critical to any enterprise.

7. Create the physical space that promotes interaction and connectivity.

8. Take the long view, a stance that culture needs to look ahead, not just in months but also in years and even decades.

• “Success is not final, failure is not fatal; it is the courage to continue that counts.” Former UK Prime Minister Winston Churchill’s impression promotes the principle that courage is having the strength to stand up for our beliefs and to take risks. It is the soul of passion capital. It flows from a strong creed and gives us the means to overcome our fear of failure. No one can give us courage. We must find and develop it on our own. It is born out of adversity, challenge and making mistakes. Writer Maya Angelou wrote that courage was the most important of all the virtues because without it we can’t practice any other virtue with consistency. We can’t be kind, true, merciful, generous or honest. “One isn’t necessarily born with courage,” she pronounced, “but one is born with potential.” Our challenge is to realize that potential.

• “A brand for a company is like a reputation for a person. We earn reputation by trying to do hard things well.” American business magnate and investor Jeff Bezos agrees that brands are built over time and represent a promise of performance. We can manufacture brands based on clever marketing campaigns, and many have, but this kind of branding is superficial and isn’t a recipe for longevity. Lasting brands are built on creed, culture and courage. They take on some of the passion associated with great causes. Likewise, great causes can learn from the performance of great brands. We also create great brands by going against the grain or transforming the status quo.

• “Who can exhaust a man? Who knows a man’s resources?” French philosopher and playwright Jean-Paul Sartre concurred that resources are assets that fuel growth and performance. There are essentially two kinds of resources: renewable and non-renewable. Our behavior often doesn’t discriminate between the two. We act as though the non-renewable are endless. We are seeing this today with oil and at some point with water. In business we sometimes see it with money, the sense that we can always borrow more. The way we identify, use, and preserve resources — financial, human, intellectual or technological — determines how our company will function. We can find them in unexpected places, both within our companies and within ourselves.

Passion capital flows when resources are allocated effectively, when the right resources are invested in the right place at the right time. The size of available resources is not always related to the success achieved. When marshaled and mastered, they are the lifeblood of passion capital.

• “Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.” The Art of War author Sun Tzu’s thought coincides with the basic meaning of a strategy — a plan to achieve a specific goal. It is the brain of passion capital. Most strategies overestimate what can be accomplished in a year and underestimate what can be accomplished in five years. The typical strategic planning tool of SWOT (strengths, weaknesses, opportunities and threats) analysis needs to be replaced by SPOT  (strength, passion, opportunities and threats.) Passion is a critical component of effective strategic planning. It needs to have a much longer time horizon than next quarter or next year.

• “Money grows on the tree of persistence.” This Japanese proverb echoes the principle that persistence is the determination and will to keep working toward something we believe in. It is the heart of passion capital. It is the vehicle that transports us from loss, blockage, and defeat to a fresh starting point. It is both an attitude: patience, and a learned skill: imaginations. It is born in belief and self-sacrifice, often in the service of a greater good.

“Passion is a gift we give to ourselves and then to our company,” Alofs said. We have to own our passion, build our passion capital, become a passion capitalist and we will be in possession of the world’s most valuable asset.

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