Jan Mühlfeit

Happiness Is a Serious Matter

Jan Mühlfeit, Chairman Europe Microsoft Corporation

We live in a world full of serious problems and those indeed need serious people to solve them. I am however deeply convinced that in order to achieve a sense of our own realized potential, not only we need to be serious in what we do, but equally we need to be happy about the way we do it. It was back in 1776 when Adam Smith, Scottish moral philosopher and a pioneer of political economy, wrote in his book The Wealth of Nations that capitalism is about achieving a fine balance between profit and care, meaning a care about the environment as well as care about our society, a care about those around us. If we continued to focus primarily on generating only more and more economical growth, rather than on being sensitive to the others and those in need, this world would end up in great misbalance and our own  history has already very well taught us what dangers and turbulences this may bring and present.

Several years ago I went thru a little mid-life crisis. The business that I was leading for Microsoft in Central & Eastern Europe has grown dramatically and was tremendously successful – we have opened many new subsidiaries and became Microsoft’s fastest growing region for 4 consecutive years. It was at that time when during my joint trips with Bill Gates, while he was visiting our region, we had a number of discussions together about giving back, about corporate social responsibility and about how Bill thought about his own mark that he wanted to leave behind. Frankly, this very much opened my eyes and it was based on these incredibly interesting and enriching talks I myself started to question whether all the revenues and growth were giving me enough in the terms of the trail that I was leaving behind and my own sense of fulfillment. After more than a decade in business I then came to a point when I realized that while signing new big agreements with our key customers and successfully launching new products were great achievements, but it was not all that I wanted to become known for in the region.

In my life I have met dozens of very successful and at the same time very unhappy people. As I already noted, I am a strong believer that our society is in a great need of not only success, but at the same time of its own joint and individual happiness.  In fact when you look at what the Western world economies have achieved over the past decade and all the GDP growth that had been generated, the numbers are simply impressive. But at the same time the happiness index in these developed countries remains mostly flat, with people feeling empty or even frustrated. Good example I like to use to picture this paradox is the Maslow pyramid: while covering of the basic needs is essential, unfortunately it does not necessarily make one happy. And so it was about 5 years ago when after my eye-opening realization I have started to analyze and study the relation between happiness and competitiveness and came to some interesting conclusions.

While measurement of the Gross Domestic Product is a great indicator of economical value, unfortunately it simply does not say anything about quality of life, cultural fulfillment or quality of the environment we live in. I am sure the GDP measurement worked pretty well for the Western world in the second half of the 20^th century during the many years blessed with almost uninterrupted economical growth. However we now live in the 21^st century and as we have learned over the past few years, the challenges we have to face today and in the future are far more complex and serious. Whether it’s a need for inclusive globalization, a sustainable development & environment, energy solutions for generations to come or for narrowing a divide between the rich and the poor, all of these challenges in our complex multi-polar world will require a balance between profit and care – all will therefore require looking beyond just GDP.

In fact as I continued my research on this topic, I soon realized that I was not alone. Still few years ago thinking beyond pure economical indicators and looking at some more “soft” measurements may have been viewed as left-wing thinking in the terms of political perspective. Interestingly enough, one of the first European politicians to came to and voice the same conclusion was David Cameron, leader of the British Conservative Party. In 2006 Cameron first noted that there is more to life than making money, arguing that improving people’s happiness is a key challenge for politicians and that government’s focus should not just be on financial wealth. Now, imagine that was in 2006, so still relatively far before the current economical crisis. In good times, none of this effort gets much attention, yet still for years now, some analysts have been seeking ways to improve the statistic. Instead of capturing only output, like cars rolling off an assembly line, why not also try to capture – in an expanded GDP or some parallel indicator – things like educational attainment or successful child rearing or life expectancy?

Well, then when the times get tough like now and well-being and the economic indicators are so obviously out of sync, all of the sudden there is plenty that needs to be fixed. As a result, this thinking is already being picked up not only by political leaders-to-be like Cameron, but also by the current leaders of the world. Nicolas Sarkozy, the French president, recently appointed a commission to come up with a better measure for France, chaired by two Nobel laureates, Amartya Sen at Harvard and Joseph Stiglitz at Columbia. And so in this respect, let us hope that President Sarkozy’s efforts will help to highlight the clear correlation between happiness and competitiveness and will therefore enable to bring it on the agenda of not just the French government, but also of many other global political leaders.

The world we live in has changed. Therefore we also need to shift our thinking in the way we look it and in the way we measure it. One challenge is that generally we tend to measure ourselves against the others rather than against individual achievements and progress. Nevertheless, we should not forget the visionary thoughts of Adam Smith, despite of how old they may appear to be – regardless of what indicators we and our political leaders will finally pick up to measure, let’s make sure that these are not one-sided either way. I am absolutely convinced that only thru such balanced way we will be able to unlock our full human potential.