Why Workplace Generosity Matters

Workplace generosity operates on multiple levels, making it one of the most powerful forces in business. It’s relevant on an individual level (are you a giver, matcher or taker?). And, it’s a cultural ethic that can define a company from within, in the community and as a customer-engagement strategy.
Let’s unpeel the layers of workplace gratitude.

Corporate Giving
The need for generosity is more urgent than ever. A recent survey of charitable giving among American corporations found that companies were tight with their cash in 2013, despite soaring profits. Generosity isn’t keeping up with profits, as Forbes writer Susan Adams discusses in her analysis of The Chronicle of Philanthropy‘s annual survey of corporate giving.

At a time when corporate profits surged to an all-time high of $1.9 trillion in 2013, according to the Chronicle, up more than 5% over the previous year, corporate cash giving rose less than 3%, to $4.6 billion.

However, when employee volunteerism and product donations are lumped in with cash donations, corporate giving actually rose 17.2 percent in 2013, to 18.7 billion. Great news, but unfortunately not much comfort to cash-strapped nonprofits.

While American companies appear generous when seen through the total-giving lens, Stacey Palmer, the Chronicle’s editor, says that nonprofits most need cash donations, and the data on cash increases is disappointing. “Non-profits have been looking to corporations for support,” she says. “They’re hoping that companies will do more to open their wallets.”

The good news is that highly charitable companies don’t seem to be hurt by giving away money and in fact show signs of strength and growth. Topping the Chronicle’s “Most Generous” list — in terms of percentage of profit — is Alcoa, the New York-based aluminum company. In 2013, Alcoa gave away $39 million, or 12.1 percent of its profits.
Despite this charitable giving, Alcoa reported increased revenues in the most recent quarter. Generosity, it seems, is business as usual for Alcoa. The company’s extensive community giving program, a combination of cash charity and volunteer efforts, goes back six decades. The program description puts it this way:

Long before “sustainability” or “corporate social responsibility” became part of the business vernacular, Alcoa and all Alcoa employees understood the value of earning a social license to operate.

Generous Energy
Generosity is “one of the core qualities people look for in their leaders,” as Forbes contributor Erika Anderson writes in the article “Why Generosity Works Better In Business,”.
From a psychological standpoint, generosity behaves like electricity. Judith Orloff, author and UCLA psychiatry professor, says generosity is a key element in emotional health and wealth. In fact, after basic investments and savings are taken care of, she advises that generosity should be a core financial strategy.
“Generosity is an expansive energy,” Orloff writes for Psychology Today. “As Norman Lear told me […], ‘You receive as you give. But you have to expend energy to get energy. Electricity happens from rubbing two wires together.'”
Stinginess, in comparison, is constrictive, she says. A tit-for-tat mentality is a small-minded approach that “sabotages abundance.”
Companies that use generosity as a customer engagement strategy demonstrate how the energy/electricity analogy works. Giving, it turns out, is a growth strategy, too. Growth strategist and Harvard Business Review contributor Eddie Yoon describes in the article “The Generosity Strategies that Help Companies Grow” how companies like Netflix, Costco and Nordstrom’s gratify and keep loyal customers by being generous.
What form this generosity takes looks different for each of the companies, according to Yoon: Netflix rewards customers by releasing all episodes at once of its binge-worthy, original entertainment like House of Cards and Orange Is the New Black; Costco offers a “veritable free lunch buffet with its samples”; and Nordstrom’s has generous return policies and much beloved customer service.
“Here’s the singular theme that is common across these brands,” Yoon writes. “They are all great products and experiences. And they know that giving you a little taste of something great will have you coming back for a lot more — at full price.”
Generating Generosity
This generous strategy for customer engagement is so powerful that it easily permeates company culture and affects employee pride and engagement. As Yoon writes, “The etymological root of generosity is the same as genesis, genius, and generate. Generous companies appear to be proud of what they make.”
This is where we get to the core of workplace gratitude, and why experts like Orloff compare it to an “expansive energy.” When a company’s leaders and business strategies are dedicated to generosity, employees respond in kind. It fosters an overall workplace culture of generosity.
Adam Grant, author of the book Give and Take, describes generosity as contagious. In an interview with Fast Company, he says, “Givers see the best in people and communicate in ways that build trust and show respect for other people’s perspectives. […P]eople want to be more like them — following this lead, spreading this norm, modeling this behavior.”
If generosity can have such a powerful effect from leaders, think what effect a company has where giving is the norm. Smart business strategies and big corporate gifts may make the news, but positive everyday interactions of generosity and the collective drive to work together are what make companies strong.
For more on building a workplace culture of gratitude, respect and appreciation, download our FREE ebook, “Winning with Workplace Gratitude”.
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