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We share a sense of belonging to a larger purpose, mindful that our ultimate consumers are our mothers, our fathers, our sons and daughters, and our friends.

Allen Chao,
Chairman and CEO, Watson Pharmaceutical.

Vortex or Ship?

Our deep understanding of the way the purpose and values of companies drives performance enables the companies we work with to operate at their full potential.

We call companies driven by a purpose beyond profit Vortices. This is because we believe the same mathematical laws that govern the formation of natural vortices such as hurricanes or tornados also govern performance of these companies. It's this Vortex structure - the ability to function as a single whole - that creates superior performance. In a Vortex firm all employees are participating in a shared purpose and driven by common values.

In contrast, the companies we call Ships have no purpose beyond profit and set of core values to act as a central organising force. With no centre the vortex structure cannot form. Unlike Vortices the employees of Ships don't participate in something bigger than themselves. Like real ships they also require a great deal of maintenance just to keep them afloat. This wastes energy and reduces performance. Eventually real ships can't sustain themselves and they are scuttled to the bottom of the ocean or sent to the scrap yard. We found the same was true of Ship companies. Just 20% of S&P500 mega-cap companies with a market capitalization over $50 billion we rated as Ships. The evidence speaks for itself. In a competitive market environment Ships are less likely to achieve mega-cap status.

How we identify a Vortex firm
Our Purpose and Values Methodology (PVM) enables us to identify Vortex firms by reviewing the company's non-financial publications such as their website and Annual Report. In these materials we look for coherence. We search for the alignment of all the company's actions around their stated purpose beyond profit and core set of values. Lip service is not good enough. There is no Vortex structure present if the company publishes noble values but does not use them as a basis for action. It's also important that the purpose of the firm extends beyond profit. We are not saying profit is not important. Of course it is. But maximizing shareholder value is not inspiring enough to motivate employees to self-organise into a single coherent whole.

The Inside View
Because we understand the mathematics governing a vortex structure we are also able to identify a Vortex firm from the inside. Our PV Survey technology enables employees to give us the information we need by completing a short on-line survey once every six months. They tell us about the purpose and values they believe are taking the company forward. When we analyse the results we get two kinds of graph.

For Ships the graph line is shallow. This indicates to us that there is a wide range of values at work in the company. That means a lack of coherence and wholeness. There is no vortex structure and the company is unlikely to perform at its best.

For Vortices the graph line is steep. Sometimes very steep indeed. This tells us that there is a wide consensus among employees about the values driving the company. These are the core values, the eye of the vortex. It's a clear sign the company is working as a single, dynamic whole. It's this wholeness that creates prosperity.

PV Survey is part of the MetaWealth System we use to help companies become Vortices and maintain their Vortex structures, ensuring that they are highly optimized to achieve their goals. For more information please contact us.