The problem with social impact divisions
Imagine a family that decided only one family member would be ‘good’, freeing other family members from the moral burden of serving anyone but themselves, and thereby releasing them to pursue pure financial enrichment, without consideration for impact on neighbors or the community. ‘Operate within the law, but be as self-serving as you like’, would be the mantra.
Those would not be awesome people.
Imagine a community where only a small subset of people do good, while everyone else is out for self-serving enrichment. This would not be an awesome place to be.
Yet surprisingly, many companies decide that this is the best path for their ‘good’ activities, in setting up ‘corporate social responsibility’ teams, corporate foundations, or latterly, ‘social impact’ teams.
In most cases the choice to establish these teams is well intentioned and comes from an earnest desire to have more positive impact in the world (in some cases the motivation is cynical: a desire for positive perception, but that’s a topic for another time). But almost invariably, we see decisions made at the establishment of these teams creating dysfunction more than positive impact.
Social impact teams need to be set up with the right charter, executive support and role within the organization, otherwise they fall into one or both of these common problems:
- Distraction for the rest of the business: by having a ‘good’ division, the implicit message to the organization is that requirement—to serve people positively—is being taken care of elsewhere. Affecting the world positively should be the remit of the entire organization, and a part of every job. It may be that a server technician could have a breakthrough on how to use less energy, or an engineering team could build a new feature that makes the product useful in a disaster, or a customer service rep could identify how to serve people better. That benefits everybody: the business, which will be more relevant to the world, employees, who will feel greater purpose in their lives, and the people being positively impacted. There is now so much evidence that positive mission drives the business, drives consumer preference, and employee performance, that to make social good a sideshow is clearly self-defeating.
- Scarcity rather than abundance mindset: great business leaders operate with an abundance mindset, that says, ‘if we create x, we will have all the resources we need to do y, and then z…’. Unfortunately, social impact teams are typically set up to be peripheral to the core business, so either not seen as strategic drivers of success, and/ or as cost centers rather than profit centers. Therefore the abundance mindset is replaced by a scarcity mindset: ‘if we create x, then we cannot afford to do y or z — we have to choose’. Clearly, a scarcity mindset is not how great, ambitious things get done: if we want to make a meaningful impact on our major challenges—if we want our businesses to be relevant—we need to establish teams with an abundance mindset.
If you’re creating a ‘for good’ division, you should consider what that makes the rest of the business, and whether you’re setting that division up for success.
A better model is to empower the entire organization with a meaningful north star. Give people a big shared mission: we exist to do something of real importance. Then orient every job towards that. That doesn’t mean at the exclusion of standard business performance metrics: you may still be a server engineer with uptime and functional goals, but you know that the end game—the highest order purpose—is not server uptime but helping build a smarter city. Or you may be a toy a designer with the remit to create successful, hit toys but you know that the highest order purpose is to contribute to the well-being and healthy development of kids everywhere. This kind of purpose orientation — for everyone in an organization not just a few — is the way to drive employee engagement, consumer love and business results.
This doesn’t mean companies shouldn’t have people whose focus is positive social impact—far from it, we need experts—but it does mean those people should not exist in a silo division. Those people should champion and enable social impact happening across the organization: as a ‘horizontal’ rather than a ‘vertical’ function.
When companies are all-in on something, the chances of success increase dramatically. This is just as true for doing good in the world.