Applying Monastic Business Secrets to Corporations

Dear Mr. Turak,

I just read your article in Forbes.com, Business Secrets of the Trappists. I go on retreat a few times a year to the Trappist monastery of Genessee. It is always a deep and transformative time. I had never thought about the business implications of the monastic life but I now see the connection. Part of what makes monastic businesses so successful is that they do not have to deal with secular issues like competition and short term earnings etc. They also are non-hierarchical in that all the monks do all the work. They also have a strong leader in the Abbott who makes decisions unilaterally without relying on consensus. So there are many unique aspects to Trappist life. Whatever business issues come up, the monks must work them out because they are there for life. Perhaps this level of commitment makes monasteries unique as well.

I would like to talk with your further about this. My area of concentration is Trust and I wrote my PhD dissertation on the topic. You mention trust in your article. I consult and write about trust and would like to share views. Are you open to this?

Blessings to you,
Deborah

Dear Deborah,

Thanks for your insightful comments and I would love to speak to you about trust. In The Great Disruption, Francis Fukayama argues that the decline in trust is the most serious negative consequence of all the social changes that have emerged since the 1960s. I highly recommend this book.

As to the monks, my article argues that despite many surface differences the monastic model can be applied to our secular organizations with the same fantastic results. The monks of Mepkin faced ferocious competition in the egg business. Even with 30,000 chickens the next SMALLEST egg producer had several million. Eggs are a classic low margin, commodity business and Mepkin made eggs work profitably because consumers wanted Mepkin’s eggs and no others. In business terms, Mepkin was able to BRAND eggs which no other producer has managed to do.

And yes, while Mepkin, like all not for profits, does not worry about quarterly earnings, when you are counting on egg sales to feed your community the financial pressure each month may be more not less.

I would also add that most public corporations CHOOSE to focus on quarterly earnings. Warren Buffet runs Berkshire Hathaway, arguably America’s most successful corporation, and Berkshire’s quarterly earnings bounce all over. Buffet makes it clear that he will not chase quarterly earnings. His key metric is building business value which he loosely correlates with book value.

In his annual reports he clearly articulates the MISSION and VALUES that drive his decisions and he relies on TRUST to get stockholders (like me!) to patiently allow him to build value over the long term.

Yet like the monastic model, very few executives take his approach “to heart” despite his fantastic success. Instead they insist on thinking there is something so special about Buffet that his model could not be applied to their business. This “dodge”- that there is something unique about MY BUSINESS or even MY LIFE that keeps us from applying the wisdom of service and selflessness handed down to us over thousands of years from so many places- is what I consider the tragic rationalization of life.

Tom Peters in his best seller In Search of Excellence dismissed all such “exceptionalism.” He reminds us that under all apparent differences EVERY business is just “making things and selling things,” and therefore universal principles can and should be applied universally.

I also highly recommend the recent biography of Buffet called Snowball: Warren Buffet and the Business of Life. You will see many of the monastic principles applied by a man who is a self- described agnostic. One such example is the title. It is called the “business of life” not the “business of business.” Buffet consistently applies the principal my article calls “aiming past the target.” He goes outside the box of business and concentrates on the way he lives his life. Business success is the by-product of a life well lived not the point.

While it is true that monks take life-long vows, these vows are taken voluntarily. Rather than seeing this level of passionate commitment as something we cannot duplicate let’s learn from organizations like Alcoholics Anonymous that get the same passionate commitment from people without vows, hierarchy, compensation or even recognition. After all they are ANONYMOUS.

Moreover nowadays monks do leave the monastery despite these vows. When you couple this with the perennial problem of attracting new monks and the high attrition rate among new monks, many abbots have less absolute power than their corporate counterpart who must rely on consensus. And don’t forget that abbots are elected while corporate managers are not.

Finally, in the spirit of selfless service all the monks are ready to do any job. But most have regular positions that match their unique skills, and besides, the best corporations believe in “job rotation” just as strongly as the monks do!

Thank you again for your comment, and I look forward to continuing our discussion. Any friend of trust is a friend of mine.

August Turak