The Crisis of Materialistic Management

The Occupy Wall Street phenomenon clearly shows the crisis of the materialistic management paradigm. Materialistic management is based on the belief that the sole motivation of doing business is money-making and success should be measured by the generated profit only.

Psychologists have discovered the serious side-effects of materialistic value orientation. In his book “The High Price of Materialism” Tim Kasser demonstrates that the more people prioritize materialistic goals, the lower their personal well-being and more likely they engage in manipulative, competitive, and ecologically degrading behaviors.

Peter Pruzan of the Copenhagen Business School notes that traditional managerial leadership aims at optimal economic performance subject to both self-imposed and societal constraints that mandate attention to the well-being of the organization’s stakeholders. In spiritually-based leadership the “why” of organizational existence is spiritual fulfillment of all those affected by the organization, maintaining and developing the organization’s economic capacity to serve its stakeholders.

In our Handbook of Spirituality and Business Luk Bouckaert and I define the new values of the post-materialistic management: frugality, deep ecology, trust, reciprocity, responsibility for future generations, and authenticity. Within this framework profit and growth are no longer ultimate aims but elements in a wider set of values. In a similar way cost-benefit calculations are no longer the essence of management but are part of a broader concept of wisdom in leadership. Spirit-driven businesses require intrinsic motivation for serving the common good and using holistic evaluation schemes for measuring success.

The Crisis of Materialistic Management