Why large organisations will move from a ‘More to Better’ way of doing business!
For at least two decades, large organisations have been slaves to consumerism and the demands of their shareholders. As markets have rightly become more transparent, shareholder value has been perceived in ever more short-term demands for gain and profit — often quarter by quarter — at the expense of long-term planning and strategy. The only way to satisfy those demands has been to sell more stuff and make more money.
But as we approach the peak of consumerism at the same time as geopolitical unrest and financial inequality make themselves felt across the globe, smart businesses are coming to realise that a new approach is required to sustain business operations and keep customers happy. That’s why Mark Benioff, the Chairman and CEO of world-leading CRM and sales venture, Salesforce.com has joined seasoned business leaders like General Electric’s ex-Chairman Jack Welch and Alibaba’s Jack Ma in saying “The business of business isn’t just about creating profits for shareholders — it’s also about improving the state of the world and driving stakeholder value.”
More stuff is no longer making people happy — and that is not a recipe for good business. Instead of growing larger, enterprises will find they are better at pursuing both the goals of their business, their investors and their customers by becoming smaller, more agile and connected, and more network oriented. They will benefit from engaging with their customers, producing better products (which can often yield higher returns), and discovering their social conscience along with product delivery. In the US, a whole category of Benefit Corporations (or ‘B-Corps’) has emerged which leverage the power of business architecture to solve social and environmental problems as well as delivering goods.
In the world of better, success is measured not only against traditional quantitative metrics (sales, EBITDA etc.) but on qualitative goodwill: being a fulfilling place to work, developing innovation and originality, contributing to education and making an on-the-ground difference to the communities in which a business has a presence.
Travel on most airlines, and you’ll hear the hackneyed — but true — announcement: “Thank you for flying with us: we always remember that you have a choice”. The transparency delivered by online marketplaces means that consumers do have total choice; and the prevalence of review information means that products which are second-rate or represent bad value will soon be found out. To differentiate themselves, the businesses which remain will seek to engage in a much more socially responsible and relevant way in their customers’ lives. Better products, better for the world around us.