Kabbalah and Business: The Dynamic Corporation – Chapter 1

The Synergy of Economics and Religion

This exposition will address issues of concern to the world of corporate management in light of the teachings of Chassidut and Kabbalah, the Jewish mystical tradition. In so doing we will employ the traditional expository method of Chassidic discourse as a means of arriving at profound insights relevant to these contemporary issues.

The return of our people to their historic Jewish homeland challenges us as a nation to plan a strategy for social and economic renewal that will guarantee our material well-being while at the same time reflect the unique spiritual character of the land and its people. The ancient mystical tradition of Judaism in fact has much to contribute toward inspiring such a strategy. One of its fundamental tenets has always been that the material realm G-d brought into being possesses great spiritual possibilities that must be exploited if the Divine Will behind Creation is to become manifested entirely. Having been repatriated to the land where heaven and earth have maintained a timeless dialogue, we must strive to release the material realm from its overtly secular character and thereby restore the Divine purpose which attaches to all experience, mundane as well as sacred.

We often find in the Bible that before assigning someone a particular mission, G-d addresses him by name, in order to arouse his unique individuality which is so well suited to the task at hand. When the prophetic call is no longer audible to man, it can be inferred from the way in which we are each spiritually touched by G-d’s Creatio–the wonders of nature and the miracles of Divine providence. The unique sensibilities that emerge from our encounter with His world serve to guide us in mediating between heaven and earth and thereby fulfilling our Divine mission.

The peculiar attachment of modern man to the materialist forces at work in Creation beckons us to explore, among other things, the opportunities inherent in the pursuit of capital gain and profit. Although this might repel those who seek in religion a respite from the material obsessions of modern life, our tradition teaches us not to ignore the collective experience of one’s generation but rather to reveal the spark of holiness that animates the historic forces behind it–and nothing characterizes contemporary life as much as the dynamic of economic growth.

Any attempt to legitimize man’s inclination toward material pursuit must first offer some justification for reducing the world and all it contains to a mere assortment of quantifiable objects. Such a rationale can be derived from the quantifier’s tendency to see relationships of volume and number develop between diverse and unrelated objects. The very act of counting itself generates conformity of relationship by reducing all things to an equal value of one. This lowest-common-denominator approach to experience can serve to confirm the centripetal force in Creation that binds all the discrete elements of this world to a single source in Divinity. Such reductionism helps one discover the underlying unity and interconnectedness of all things.

Conversely, one who measures reality in purely qualitative terms can actually lose this awareness. By emphasizing the unique and intangible essence of things, the quality-prone mind can cultivate a pagan-like idealism whereby all elements of Creation are isolated within their own distinct and inviolate individuality. It is the quantitative orientation of economic thinking that accommodates quality within a system that is also concerned with ever-expanding profit for Creation.

Chapter 2: Involvement, Quality, and Flow

Let us now explore one aspect of contemporary economic life–the field of corporate enterprise–by suggesting a particular formula for success that has roots in Chassidic thought as well as support from intimations in the Bible.

The three major arenas of interaction that characterize the corporate environment are:

1. Interaction between the company and its employees.

2. Interaction between the company and its markets.

3. Interaction between the company and its investors.

Any broad strategy for corporate success needs to address the dynamic governing each of these spheres.

The fundamental strategy that we wish to put forth is founded upon the three principles of Involvement (in Hebrew, meuravut), Quality (in Hebrew, eichut), and Flow (in Hebrew, zeriemah). It will become clear from the following discussion how each of these principles can serve to guide a corporation in negotiating its diverse interactions and together help maximize profitability and success.

The three dimensions of corporate activity identified above center around personnel (employees), product (markets), and capital (investors). Thus, our formula can be easily summarized as consisting of personnel involvement, product quality, and capital flow. Before we proceed to elucidate each of these components in light of Chassidic thinking, let us consider two places in the Torah where the significance of these three principles is hinted at.

The first is a phrase that appears in the book of Proverbs (8:22) where the Torah refers to itself in the following words:

G-d created me as the beginning of His way,
the most primal (in Hebrew, kedem)
of His works (in Hebrew, mifal [av])
from the outset of time (in Hebrew, me’az).

The words kedem (“the most primal”) and mifal (“work”) possess connotations which render them particularly relevant to a discussion of corporate enterprise. The word kedem, which literally means the “fore,” denotes as well the concepts of “progress” or “advance.” The word mifal implies any creative enterprise, and in modern Hebrew is used specifically to mean a manufacturing plant. Together, these two words evoke the following association from the above verse: “To advance an enterprise, promote me’az (in Hebrew spelled: mem, alef, zayin)–which we can take as an acronym for the three principles identified above: Involvement (meuravut), Quality (eichut) and Flow (zeriemah).

An additional Scriptural hint to this formula can be found in the verse:

And Jacob said when he saw [the angels approaching],
“This (in Hebrew, zeh) is a camp (in Hebrew, machaneh) of G-d (in Hebrew, Elokim).”

As can be seen, the initials of the phrase “this is a camp of G-d” also form this acronym, me’az.

The image of the “camp of G-d” serves as a fitting symbol for what every Jewish company should strive to become. The “camp” was the basic organizational structure that defined Israel’s first phase of development as a people. Encompassing both their movement and settlement during the forty years of sojourn in the desert, the “camp of G-d” became the first paradigm of constructive group activity within the Israelite community.

In analyzing these three words (machaneh Elokim zeh, “this is a camp of G-d”), it is possible to arrive at an even more exact correspondence to the corporate principles suggested above. The “camp,” as an organizational archetype, hints at the Involvement-driven group-structure one strives to create within a company. Its being “of G-d” hints at the Divine ideal of Quality that every organization should aspire to in its active life. Finally, the word “this is” (zeh), suggesting in our verse the ability to identify quality when one sees it, hints at the Flow (zeriemah) of creative force that inspires success(in Hebrew zeh and zeriemah both begin with the letter zayin and end with the letter hei.

The word me’az, which we have adopted as the acronym for the purpose of our study, literally implies the idea of something harking “from the onset of time.” As such, it imparts a sense of the primordial, as does the word kedem (“original”) that appears together with it in the verse quoted above. The relevance of things primordial to the subject of corporate enterprise lies in the implicit correlation which one can draw between creative success that is lasting and the primal roots of experience from which it derives its inspiration.

One can only have confidence that his creative efforts will be met with blessing if the inspiration for those efforts comes from an ancient and eternal source of wisdom. All things primordial last for eternity; the word for “eternity” (netzach) also possesses the connotation of “victory” and “success.” If one’s enterprise is established exclusively upon a contemporary and temporal knowledge-base, success may be achieved but it will not be lasting in nature. Enduring creativity is only possible by reaching beyond one’s available resources and tapping into a primordial source of energy that infuses one’s venture with an eternal and Divine character.

The Torah is, of course, the primary source of creative wisdom that comes down to us me’az. Let us now employ it in further exploring the subject at hand.

Chapter 3: Inside the Corporate Family–Involvement Without Interference

The extended family clearly prefigures the “camp” as the basic organizational structure depicted in the Bible. Before Israel became a nation, it was known as “the House of Jacob,” a recognized spiritual as well as socio-economic unit held together by the bonds of a common origin and destiny. Consequently, any company aspiring to become a “camp of G-d” should first seek to emulate this model of the extended familial community.

The actual word in Hebrew for “corporation,” chevrah, is used as well to denote any organized social system, the most fundamental of which is of course the nuclear family. The additional connotation of chevrah, “friendship and camaraderie,” suggests the spirit of human warmth that should pervade every form of chevrah–including that which is established for pure economic benefit.

The modern corporation has its roots in the early tradition of the “family business.” Every family possesses a patriarch who presides over its extended network. The natural heir to that position is usually vested with a certain measure of responsibility as a sign of the implicit faith and confidence that his father has in him. If the heir is truly worthy of this trust, he will act as a “son turned servant,” subordinating his own needs to those of the family unit at large. It is this subservience which, somewhat paradoxically, earns the son the right to act with his own initiative. Insofar as he acknowledges his essential dependence upon a higher authority, the son can be encouraged to cultivate his own unique talents and abilities so that a new generation of leadership may emerge.

As one of the few vestiges of hierarchic rule left in our obsessively democratic culture, the corporate structure demands a strong prevailing head. Nevertheless, its roots in the familial tradition demand that employees sense the commensurate love and respect accorded them as members of the corporate clan. Only then can they be expected to feel, in addition to the loyalty and dedication characteristic of a trustworthy servant, the responsibility of a succeeding heir who has internalized the creative ideal promoted by his elders. A pervasive atmosphere of love and respect encourages all personnel to seek and enhance the common aim of the corporate body by exercising creative initiative and independent thought.

The motto guiding personnel-interaction within a company should be “involvement without interference.” The balance between individual freedom and team discipline necessary for the optimal functioning of an organization can only be preserved by promoting the principle of “involvement without interference,” a function allowing for independent initiative while preserving the framework of group accountability. Resourcefulness on the part of individual employees is only beneficial when it is accompanied by strong identification with the general group effort. If motivated by, or aimed at, the devaluation of any other corporate team-member, such initiative should not be tolerated.

The first to recognize the value of a “flat” hierarchical system, where lower-level functionaries are invested with maximum responsibility, was Jethro, the father-in-law of Moses. In proposing a more democratic system for adjudicating the day-to-day affairs of Israel, he showed great insight into the efficient and productive use of bureaucratic systems. By suggesting that the judiciary be constructed in pyramid form, with a predominance of local representation at its base, he demonstrated a faith in the ability of subordinate authorities to govern the major part of community life.

Moses, one can assume, was hesitant to propose such a model–if only because he felt that maximum involvement on his own part, having alone received the Law from the “mouth of G-d,” was essential to guaranteeing a fair and accurate decision based upon the truth absorbed within his soul. Jethro, on the other hand, believed that no harm could come from delegating certain prescribed responsibilities to other individuals who also possessed, if not on as perfected a level, the necessary refinement of knowledge and character. On the contrary, he felt, willingness to do so would be the height of benevolence and lovingkindness toward:

(1) the community, who would be afforded easy and direct access to the due process of law;

(2) the chosen officials, who would profit spiritually from the opportunity to exercise judicial responsibilities;

(3) most obviously, Moses, who would be relieved of a tremendous communal burden without compromising the decisive weight of his authority and opinion.

In the end, Jethro’s perspective was accepted by Moses, and a new hierarchic model was born–predicated upon a wide delegation of authority by the designated chief executive of the community.

The success of this model is dependent upon the ability of the delegating authority to inspire and guide even when physically removed from the actual field of operation. As such, the creed of “involvement without interference” is just as relevant to the authority’s management force as it is to his personnel. The importance of this creed in establishing a proper state of leadership can be understood by pondering the state that G-d Himself assumes vis-a-vis His own Creation, as described in the following statement from the Zohar:

He grasps all worlds, yet no one grasps Him.

Though everywhere around us, G-d’s presence is rarely felt as an invasive force constraining our activity in the world. Man acts freely, and experiences himself as such, while Divine Providence continues to tacitly affect the outcome of all that we set in motion. The mysterious juxtaposition of man’s free will against the backdrop of Divine care and supervision comprises the essential paradox underlying all man’s efforts to influence and rectify the world he lives in.

This same paradox attaches to the management of any creative enterprise where independent initiative must blend with higher directive. G-d’s hidden, yet influential, presence in the world supplies a model of management whereby self-restraint is willingly employed as a way of promoting positive input at all levels of the organization.

However, just as independent initiative can lead to interference, so too can self-restraint result at times in indifference or even neglect. When properly applied, though, managerial self-control serves to enhance the corporate environment by inducing personnel to increase their involvement and assert their dormant potential. The revelation of that potential is what provides management with the knowledge and resources to advance its creative plan.

The creative potential inherent in one’s work-force is the greatest asset and strength of a company. In fact, the Hebrew word koach denotes both “strength” and “potential,” alluding to the might that goes into restraining one’s powers where the purpose is to reveal the potential in others. The idiom used in modern Hebrew for “personnel” (koach adam) means literally “manpower,” but is also translatable as “human potential.” Such potential is management’s greatest resource and must be actively cultivated if a company is to inspire maximum effort and generate optimal output.

Chapter 4: Mastering One’s Markets–Where Quality Rules

The domestic atmosphere that a company aims to create by encouraging a familial spirit within its ranks must be offset by an aggressive stance vis-a-vis the outside markets it seeks to serve. Here, an assumption of confidence in one’s powers to influence and dominate is the posture of choice. Whereas a deferential style may help spur internal cooperation and productivity, when facing one’s markets one must learn to adopt an attitude of assertive pride in the service or product he is offering.

It is crucial, however, that this corporate pride be tied to one thing only: quality. Reputation, value, service, and even profit-return must never replace the quality of a product as the jewel in the company crown. In markets as vast and far-flung as those which confront the modern manufacturer, representing one’s product to customers becomes a contrived task. With most end-users nothing more than anonymous fish in the big consumer ocean, the only reasonable option is to “cast your bread upon the waters” and let the product speak for itself.

The intrinsically impersonal character of contemporary markets serves to propel modern corporations toward aggressive self-promotion aimed at securing hegemony within those markets. In an interactive mass-economy, where the unbridled desire for market-rule can lead to either prosperity or peril for all involved, a company must justify its pretensions to power and domination. This is where the balance between a nurturing style within the company and an aggressive one without serves to insure against the self-destructive tendencies often observed in corporate life.

The goal of establishing market-hegemony demands that the company devise a relational paradigm for interacting with markets that is based upon a monarchic model. Unlike relating to employees, where a casual familial style promotes growth, winning potential markets demands a much more formal corporate persona. Jewish law dictates that whereas both father and teacher are allowed to decline the honors normally accorded them, a king is absolutely prohibited from compromising the dignity of his office–even if motivated by devotion to his subjects. The esteem attached to kingship is no mere privilege of office; it is an integral aspect of the kingly function. For the ascendant corporation, this means avoiding the tendency to pander to its markets if doing so entails compromising its standards of excellence.

The pride one takes in the quality of a product is ultimately a reflection of the respect he maintains for the markets at which the product is directed. If a king is unable to compromise the honor of his office, this is only because it would compromise the honor of his kingdom and his subjects. The risk of losing market popularity is indeed small if it is clear to all that the standard of quality one maintains in a product reflects the image one has of those for whom that product is intended.

Clear dedication to a creative ideal is what most protects the corporate self from false pride and conceit. Especially as regards a company’s internal health, which can be endangered by individual ego and ambition, the ability of management to model selflessness in its commitment to corporate excellence will bolster the entire company without jeopardizing the dignity of the executive office itself.

This can be clearly seen from the example of the Biblical king of Israel, for whom the Heavenly Kingdom serves as inspiration for his own earthly rule. In the Bible’s description of the celebration that accompanied the arrival of the holy ark in Jerusalem, we find King David unabashedly dancing and leaping before the approaching ark. He is subsequently chastised by his wife Michal for demeaning the dignity of his office in comporting himself so frivolously before his subjects. In his reply to her, we find the testimony of a sovereign who understands that the honor of his office belongs not to his person but to the Power that has invested him with his kingly responsibility:

And David said to Michal: It was before G-d, who has chosen me above your father and all his house to be appointed as a prince over the people of G-d, over Israel; it was before G-d that I frolicked. May I demean myself even more, and be lowly in my own eyes–yet before the servants of whom you have spoken, with them will I be honored.

This incident, together with King David’s response, indicates that the unique humility of kingship need not always be concealed when its revelation allows others to share in the joy of serving the ideal which legitimizes one’s royal powers. In our context, the ultimate advantage of the executive adopting an occasionally self-effacing and transparent managerial style is that it allows the employees to validate his authority by exposing them to the creative vision in which it is grounded.

To the same extent that “abasing” oneself before employees is justified when done for the sake of sharing his vision and enthusiasm, so too is the occasional expression of pride in a company’s creative achievements an appropriate demonstration. This odd combination of pride and humility essential to Jewish leadership is compared in the Kabbalah to the surging (gei’ut) and ebbing (shefel) of the sea. The numerical equivalence of these words (gei’ut= shefel = 410), suggesting the pendular motion of the ocean tide, serves to teach us as well that it is the extent of a leader’s humility which determines the degree of power he can instinctively allow himself to assume.

What marks the humility of kingship as so unique is the sense of mission and responsibility with which it is imbued. By reining his ego, the king ensures that the ideal which he seeks to promote will strike deep into the heart of his subjects, just as the trajectory of an arrow is determined by the degree of restraint exerted in pulling back the bow-string. For the corporate “archer” whose target is his market, the challenge of identifying a unique and worthy need for him to serve should provide a focus for his powers of humility and restraint. Once he succeeds in recognizing that outer need, he sets his product in motion so that it may proceed toward its intended mark.

The task of identifying an objective need in the world to which one can offer a singular response must be the foremost concern of any aspiring company. The extent to which the corporate power can suppress its own “self-interest,” be that defined as any goal other than the “common good” of the market, will determine its success in fulfilling its creative mission.

The quality of a product is measured by its distinctiveness of function as well as of form. Its ability to serve the need that it was designed for, while at the same time evoke the creative vision and power that produced it, will determine its ultimate quality. The strength that one is measuring when considering quality is referred to in Hebrew as on (“potency”), a gauge of the impact one makes through the act of creative self-expression. It is this imprint left upon a product which carries a message of excellence into markets of the future, thereby ensuring a company’s enduring relevance and survival.

Chapter 5: Widening the Investment Channel–“Grow with the Flow”

In relating to employees and markets, a company often finds itself in asymmetrical interactions: vis-a-vis personnel, management strives to act with considered deference while, at the same time, unleashing a campaign of influence and persuasion on its potential markets. The only corporate arena where mutualized interactions can take place is the boardroom, where executive leadership meets the company patronage. Dependent upon each other for the sustained growth of the corporation, the two must arrive at a modus vivendi that reflects the reciprocity of their relationship.

The principle guiding their relationship should be that of cooperation aimed at strengthening the vital sign of corporate health, a steady “flow” of investment and return. The greater this “flow,” the wider the investment channel becomes and the further upstream the company can sail its product. The surest guarantee of free-flowing capital is the establishment of trust between management and investors.

Unlike a company’s relationship to employees and markets, which focuses on the conditions necessary for optimizing production and demand, its relationship to investors revolves around profitability. Money is the medium which flows between the two in a swirling motion that carries capital into the company and retrieves profit for its holders. The word in Hebrew for “trust” (emunah) is related to that for “money” (mamone), highlighting the importance of good faith in securing financial well-being. The very term “shareholding” expresses the value of trust and cooperation in solidifying the bonds between management and ownership.

Besides the investor pool, there is another essential body in whom management must inspire trust and confidence if it is to guarantee the company’s financial base: the bankers. As the company’s debt financier and major lending source of venture and working capital, the bank must be welcomed as an intimate partner in virtually all aspects of the corporate enterprise. By taking care to choose a bank with good knowledge of the business one is in, and cultivating with them a rapport based upon understanding, patience, and friendship, management can find in its bankers an indispensable source of objectivity regarding the health of one’s company. At times of fiscal stress, a knowledgeable and concerned banker can help a company evaluate whether the source of difficulty is managerial or purely financial in nature. Establishing a banking relationship upon openness and trust will guarantee the maximum advantage to be gained by all.

One of the goals of management should be to keep the spiraling cycle of trust in one’s company growing until it touches all potential investment, drawing even the company’s own customers into the vortex. Whereas market-strength is characterized by an aggressive forward thrust in sales, the capital-strength of a company is characterized by the more stable and reassuring pattern of spiral-expansion that draws more and more people into a reciprocal sharing arrangement. The ultimate display of faith that a market can show in a company’s product is to enter the investment stream and thereby reinforce the corporate momentum. As the “flow” increases and the channel widens, all benefit from the increased surge in corporate growth.

The term in Hebrew for capital strength is chayil, a word that implies both power and wealth. Unlike the synonyms for strength mentioned earlier–koach and on–denoting the “potential” and “potency” inherent in goods and those who produce them, chayil is a measure of the success one achieves through those goods, expressed primarily through the capital they generate.

Implicit in the root of the word chayil is a connotation of ever-expanding circular motion (mechol) seeking out broader and broader orbits within which to extend its influence. The contagion of success is what every enterprise wishes for itself, its product, and the markets it serves. Let us conclude with the standard blessing offered those who embark upon the road to such success: “May they proceed from strength to strength–from bounty to bounty.”