One Sentence Summary
The main point of the book is that great companies and great leaders focus on higher level human needs in all aspects of their business, which, besides predictably increasing customer, investor, and employee loyalty, has surprising implications for long term profitability and resilience.
Paradigm Shifts & Adjustments
How has this book changed the way I think?
Peak made me realize that the distinction between a flourishing person and one who is merely just surviving also appears in the business world. At core, great companies are operating on great philosophy in the same way great individuals do. This challenges the typical notion that capitalism is all about profit- seeking … as is made clear in Peak, the most successful companies today are optimized around much more substance than just their bottom line.
Interestingly, there also seems to be a symmetry between Maslow’s philosophy and the philosophy of the ancient Greeks. Both seek to define what constitutes a good life, and they to some degree agree about the definition. A good life is one in which individuals systematically improve themselves and their life circumstances by means of virtuous activity. It is a life of rising to occasion, overcoming base impulses, and, perhaps most importantly, being a positive contributor to the general human experience.
The signal for this good life is the individual’s reward. According to Maslow, living an inspired results in self-actualization, and self-actualization is characterized by peak experiences… a phenomenon the Greeks may have referred to as channeling the divine through poesies (craftsmanship) or physis (collective flow states):
“What seems to distinguish those individuals I have called self-actualizing people, is that in them these episodes (peak experiences) seem to come far more frequently, and intensely and perfectly than in average people. This makes self-actualization a matter of degree and of frequency rather than an all-or-none affair.”
Abrama Maslow
As these experiences are deeply pleasurable, Maslow also agrees with Aristotle and Epicurus that a good life is consequently also an intensely pleasurable one.
For all the agreement, though, the important divergence between Maslow and ancient Greek thinking was their perception of what constitutes virtuous activity, or in other words, what a good life looks like. Peak is not a book about self-actualization through moral virtue, as Socrates would have claimed, nor philosophical contemplation of the highest good, as Aristotle famously declared. Rather, Chip Conley seems to agree with Maslow that the most virtuous activity is …. entrepreneurship?
As Maslow puts it:
“The difference between the great and good societies and the regressing, deteriorating societies is largely in terms of the entrepreneurial opportunity and the number of such people in the society. I think everyone would agree that the most valuable 100 people to bring into a deteriorating society would be not 100 chemists, or politicians, or professors, or engineers, but rather 100 entrepreneurs.”
Granted, a true convergence here would always have been unlikely as entrepreneurship looks much different today than it the early centuries. Still, there was business activity in a general sense in ancient Greece that was not identified as being particularly virtuous by its greatest thinkers, and this reflects a perception that has carried into today: to seek wealth and material things is neither moral nor good, and in fact is typically much the opposite. Therefore, industry itself is only a shallow and spiritually incomplete human endeavor.
Peak refutes this perception. It suggests that after meeting basic needs, companies can and do continue to level up by seeking to enhance not just the material lives of their customers, employees, and investors, but their spiritual lives as well, an enhancement which contributes to their self-actualization. If you buy this, the fascinating implications is that at its best, capitalism can create vast, collective networks of human flourishing.
This would upgrade capitalistic systems from mere creators of the foundation for a good life (through wealth generation) to actual methodologies of it. Further, that this claim would likely offend Aristotle and the other ancient Greek philosophers (and many of their more sentimental contemporaries) speaks to another interesting consideration: this version of a good life may only have become recently decipherable.
To borrow Maslow’s terminology, economies as a whole may have simply been too far down the pyramid to function as anything other than a means to meet our level one and level two needs for much of history. Perhaps, then, we’ve only just recently reached a developmental benchmark where we can level up and self-actualize through industry.
That this is new development may be an extension of capitalism as opposed to just an aberration in it is evidenced by Peak’s data for the increased profitability of companies who have taken the next step to meeting the needs of the human networks they come into contact with – by evolving philosophically, the rewards of capitalism seem to only be enhanced, which suggests that it’s an inherent function of the institution.
This is a paradigm shift for me because when I was an uninspired employee, I associated an emphasis on capitalism with more or less bad philosophy. Like many, I saw the pursuit of money for its own sake an end which was distinctly unsatisfying and unworthy of singular focus. Peak has made me consider that great business today is not just about the bottom line. Rather, good philosophy and higher ideals are very much to be found in the best companies, and, in fact, may even be best found there. As such, the path of the entrepreneur could well be a new and surprising case study of a good life in the modern age.
Great Quotes
“He who has a why to live can bear with almost any how.”
Nietzsche
“Are you breathing just a little and calling it a life?”*
Mary Oliver
The person in the peak experience usually feels himself to be at the peak of his powers, using all of his capabilities at the best and fullest.…He is at his best, at concert pitch, the top of his form.
Abraham Maslow
Quite likely the only possible source of sustainable competitive advantage in the new economy will be the bonds of loyalty you generate…. Human capital, unlike other assets, does not depreciate over time. Like good wine, it actually improves with age.
Fred Reichheld
We have known for 50 years that money alone does not motivate to perform. Dissatisfaction with money grossly demotivates. Satisfaction with money is, however, mainly a ‘hygiene factor.’
Peter Drucker
The biggest differentiator between an average company and a great company is the motivation of the people within the company.
Conley, Chip. PEAK (p. 53). Wiley. Kindle Edition.
The Geek Squad is not going to cure cancer, but we will repair the computers of people who do.
Robert Stephens
But I’ll also be critical of the risk that bedevils most companies: getting comfortable with purely satisfying customers rather than delighting the hell out of them.
Conley, Chip. PEAK (p. 100). Wiley. Kindle Edition.
The secret to great investing isn’t becoming the ultimate whiz kid at financial models or necessarily being the shrewdest negotiator in the room, it has a lot more to do with building long-term relationships with entrepreneurs and business leaders who deserve your confidence.
Bill Price
If there’s one constant theme in all three pyramids, it’s that conventional wisdom is wrong. Conventional wisdom suggests that (1) money is the primary motivator for employees, (2) customers stay loyal when they’re satisfied, and (3) investors are exclusively focused on the financial return on investment.
Conley, Chip. PEAK (p. 187). Wiley. Kindle Edition.
Success is all about getting; significance is about giving back.
Ken Blanchard
Maybe what Dr. Timothy Leary whispered to me all those years ago was spot on: The business world can be the most powerful institution for change that we’ve ever seen.
Conley, Chip. PEAK (p. 191). Wiley. Kindle Edition.
Life is service. The one who progresses is the one who gives his fellow men a little more—a little better service.
John Zimmer, co-Founder of Lyft
Interesting Data/Facts
- Conley cites the empirical research published in the book Built to Last early to support his claim that peak companies are also more financially successful one. In that study, 6 years of research found that 18 “visionary” companies (companies that operate on principles similar to those endorsed in Peak) outperformed 18 comparison companies by a wide margin – the visionary companies outperformed the stock market since 1926 by 15x while the comparison companies only outperformed it by 2x.
- In his book Liberating the Corporate Soul, Richard Barrett cites a study that shows that about 40 percent of the variability in corporate financial performance comes down to something as simple as employees’ sense of fulfillment in the workplace.
- According to a study cited in Adrian Gostick and Chester Elton’s Managing with Carrots, companies that have an employee recognition strategy show double the return to shareholders compared with those companies that don’t have such a strategy.
- Psychologist John Gottman’s landmark study on marriage found that successful relationships averaged a five-to-one ratio of positive to negative interactions.
Buy it here!