Filed under: Corporate Citizenship, Google, Unilever | Tags: Anglo-American, Corporate Citizenship, GE, Google, Kimberley Clark, Occupy, SABMiller, Unilever, Walmart
This year, I’ve had conversations on with ten major corporations about business and society – mainly FTSE-100 companies, and mainly at CEO or Chairman level. All really interesting.
They’re all keenly aware of the hostile, anti-corporate sentiment surrounding them. As one client put, “my teenage kids think we’re the bad guys”.
So it’s been interesting to read Screw Business As Usual – not an Occupy manifesto, but the new Branson book. I doubt that Branson’s kids think he’s one of the bad guys; he’s still the anti-establishment rock-star CEO.
It’s a good read. Raconteur-ish, but well researched. As you’d expect, there’s plenty on the power of entrepreneurial thinking, and its potential to solve the world’s problems.
More surprising is that Branson – the self-styled Goliath challenger – is a real champion for the positive impact that big corporations can have. He gives the clearest articulation of this when discussing Walmart:
[Walmart] now has 100,000 suppliers, 2.1 million employees, 200 million customer visits oer week and annual sales of $419 billion (greater than the GDP of more than 166 countries)… Just their sheer size means that when they do get something right it has incredible ripple effects. They can shift a whole industry by applying pressure in the right places… They can also create millions of opportunities when they shift their buying strategy.
It’s a good articulation of why I’m doing what I’m doing right now. There are plenty of other examples he picks up:
• GE’s commitment, through Ecomagination, to investing $1.5 billion annually into R&D on clean tech.
• Anglo-American’s pioneering work to fight HIV/AIDS in South Africa, before the ANC recognized the problem.
• Google’s work making data available to promote an open discussion on global drugs policy.
• Kimberly-Clark’s invention of the tubeless toilet-roll (trivial? 17 billion tubes go into landfill each year in the US alone. Who knew).
• SABMiller’s innovative work in Africa’s newest country – South Sudan – brewing beer from Cassava to in order to buy from local farmers.
• Unilever’s Project Shakti in India, establishing thousands of female “micro-entrepreneurs” in a distribution network across 135,000 villages.
Some of these companies are our clients – and it’s safe to say that none of them have had an easy time being the good guys. All of them have had difficult issues: tax avoidance, palm oil, privacy, safety, etc etc. But these businesses can be a positive force – and Branson’s book gives a handful of them a slap on the back. A bit of positive reinforcement, to balance the well-deserved public pressure.
Image from IndyBay
Filed under: Corporate Citizenship, Nike Foundation, Unilever | Tags: Burberry, Corporate Citizenship, Corporate Foundation, foundation, Nike, Nike Foundation, Thomson Reuters, Unilever, Virgin Unite
Last week I arranged a breakfast for a few big corporate foundations. Unilever kindly hosted it, in their plush CEO dining room – a clear bright morning, with a panoramic view of the London skyline. We were joined by the Thomson Reuters Foundation, Virgin Unite, Nike Foundation and Burberry Foundation.
One thing’s clear: in the world of corporate foundations, this lot are a new breed. Here’s why.
More matter, less art.
Historically, corporate foundations were likely patrons of the arts – but now the energy moving away from theatres and galleries and towards the slums and inner cities. The magic word is “impact”. The arts institutions really need a new narrative to retain their corporate patrons.
More international.
The multi-nationals are becoming multi-locals, so the story goes – and the new wave of corporate foundations has a naturally international outlook. Increasingly, their partners are the international development agencies and NGOs.
More employee involvement.
Many foundations are still far removed from real business – just benefactors for the favourite charities of chairmans’ wives. The new wave is much smarter: the corporate foundation is a catalyst for employee engagement, a feeling of belonging and shared endeavor, a feeling of pride, and in some cases a platform for developing new talent.
More aligned to corporate brand and strategy.
This is about leveraging the core competencies of the business – legal advice or journalism, if you’re Thomson Reuters. In other cases, it’s about being emblematic of the corporate brand: entrepreneurialism if you’re Virgin, or creativity if you’re Burberry.
There’s an instinctive sense in the people running these foundations that to make a difference, the foundation has to really resonate with the heartbeat of the parent corporate.
It was an interesting session, and fun to organize. Everyone agreed we should do another one before the end of the year, and invite a few other kindred spirits.
Lovely image taken from Unilever’s roofgarden from here.
Filed under: Africa, Multinationals, Rapidly Developing Economies | Tags: Africa, Airtel, Barloworld, Caterpillar, China, Ecobank, Geely, IBM, India, Lenovo, Mahindra, MTN, Multinational, Rapidly Developing Economies, Tata, Unilever
The debate around corporate citizenship has a very Anglo-American flavour – possibly a mistake, when you think about the rise of a new generation of multinationals from rapidly developing economies.
Iconic Western brands like Jaguar and Land Rover are now owned by Tata Group of India, and the middle-class comfort-car Volvo is owned by Geely International of China. The world’s biggest telecom company is Bharti Airtel, with businesses in 19 countries. IBM’s PC business is now owned by Lenovo Group of China.
Maybe we should broaden our horizons a little, stop obsessing with the neocolonial multinationals (Unilever, Nike, PepsiCo,etc) and pay some attention to the next generation. Some of them have interesting stories. Here are my four top examples:
1. MAHINDRA
Mahindra is a vast conglomerate operating in 100 countries, working in every industry you can think of: aerospace, agriculture, automotive, defense, energy, financial services, to name a few. Mahindra is a champion of the emerging market story: “We are many companies united by a common purpose—to enable people to Rise“, is the opening sentence on its corporate website. Rise is a corporate narrative developed by my old friends at Strawberry Frog; it’s an ambitious program to mobilize the business into a kind of cultural movement. This isn’t standard corporate language. As the website puts it:
Rise is a call to action. It’s the challenger spirit that leads us to build ourselves better lives. The thirst for a brighter future is something shared by people around the world. Rise is a movement of determined people who are working towards goals of all sizes, every day.
2. BARLOWORLD
South Africa’s Barloworld makes Caterpillar and NACCO trucks, and has operations in 110 countries. Barloworld was hit hard when the already fragile South African economy was faced with the fallout from the Soweto riots. Their response, according to Article 13, was a groundbreaking Human Rights code which embedded the right to non-discrimination. This was counter to the prevailing political wind: for example, the code gives everyone the right to use the same toilets, which was at the time illegal in South Africa. I thought that deserved a gratuitous image of a monster mining truck:
3. ECOBANK
Ecobank is Africa’s largest banking multinational, operating in more African countries than any other bank – and driven by the slogan, “Taking Banking to the People”. It’s was chosen as a case study by Business In The Community, for local community involvement: a children’s hospital next to it’s Ghana HQ was in poor repair; the business permanently “adopted” the hospital. A small example, but an interesting response. Here’s the bank’s recent Rhythm of Africa TV spot:
4. MTN
MTN is the largest African mobile provider, working in 21 countries in Africa and the Middle East. It has a history of overcoming the exclusion of the poor through innovating new models – most recently, mobile banking, which it’s launching in all markets. According to NextBillion, access to banking is crucial to economic development, and MTN are confident of the consumer benefit: “It’s cheap, it’s easy, it’s unintimidating,” Jenny Hoffmann, head of MTN Banking, told NextBillion. “And if you live on a hill in (rural Africa) you don’t have to go to town to make a payment.” Here’s a launch ad from Cote d’Ivoire (source):
Filed under: Corporate Citizenship, Unilever | Tags: Corporate Citizenship, corporates, development, DFID, language, Microsoft, Natura, Nestle, nextbillion, Oxfam, P&G, Technoserve, UN, Unilever, USAID, Wal-Mart, WEF
We all know why the oil companies talk about energy exploration instead of drilling for oil, and why the book-makers talk about gaming instead of gambling. Language matters… So we’ve been looking at the language of corporate citizenship, and there are a few interesting themes.
We looked at the reports and websites from a few global corporates (Unilever, P&G, Natura, Microsoft, Wal-Mart, Nestle), some global NGOs (Oxfam, Technoserve, nextbillion.org, Africa Progress Panel) and a few global institutions (World Economic Forum, United Nations, Department of International Development, USAID). Here’s what we found.
- Self-referenced language vs Independent reference. Corporates are much more likely to refer to people by their relationship to themselves: “suppliers”, “employees”, “customers”, etc. Non-corporates use much more independent references: “people”, “farmers”, “communities”, etc.
- Goal-orientated vs. journey orientated. Corporate language is highly goal-orientated, suggesting action and efficiency: “programmes”, “processes”, “targets”, “operations”. Non-corporates are more likely to use “journey orientated” words which suggest participation and inclusiveness: “support”, “together”, “work”, “shared”, “help”, “change”.
- De-personalized issues vs People issues. Corporates talk about issues in objective, de-personalized language – “water”, “waste”, “food”, etc. Non-corporates are more likely to use words which invoke a human aspect: “healthy”, “women”, “poor”, “social”, etc.
- Some words were less in evidence than expected. These include: “innovation”, “impact”, “invest”, “progress”, “growth”.
- Development is a word that is used by both communities – it’s a potential bridge. Unilever talk about “market development” a lot, and Nestle have “rural development” as a goal, and SABMiller have “enterprise development” as one of their ten priorities.
Interesting to think about how a shift in the words we use might help corporates and non-corporates to find new ways of working together. Anyway, to bring this to life a little, we got a bit carried away on Wordle – see what you think:
I’m back in London. India was intense, as ever – filthy, beautiful, putrid, delicious, noisy, exuberant, etc, etc. The Himalayas soared and sparkled.
On the way down we stopped at Rishikesh, and walked out to the old abandoned ashram in the hills where the Beatles stayed in the Sixties. It’s been re-claimed by the jungle – quite a poetic end for the place where they did LSD and meditated and learnt to play the sitar, and where eastern mysticism became western pop culture, for a while…
Somebody should write the screenplay: four scousers in their mid-20s, more famous than Jesus, wearing Indian dohtis, getting stoned and chanting Vedic mantras, with their entourage of Mia Farrow’s and record company execs. It’s all there: drugs, sex, scandals, money, fame, the search for truth…
John Lennon said it was the most creative period of his life; they wrote dozens of songs there. I think it’s fascinating that the world’s biggest pop icons were drawn to a philosophy that wholly rejects mainstream consumer culture. Maybe they had a spiritual itch to scratch; as George Harrison explained,
“Like, we’re The Beatles after all, aren’t we? We have all the money you could ever dream of. We have all the fame you could ever wish for. But, it isn’t love. It isn’t health. It isn’t peace inside, is it?”
So what’s this got to do with anything? I had my first business meeting today, at Unilever – an interesting discussion about the need for a new language, to describe a world where we can create economic growth, consumer wellbeing and environmental progress. It feels like they’re trying to create a new reality.
I think first we need to look at our own role in fueling consumer culture. When the Beatles disappeared to a remote town in the Himalayan foothills, they brought a radical creative challenge to the conservative mainstream . I think we need another challenge. Where’s it coming from? What if it came from the big corporates…?
Normal service will resume shortly. Image from Paul Saltzman.
Filed under: Uncategorized | Tags: Accenture, Apple, CEO, Dow Chemical, GE, Ikea, Intel, Nike, P&G, Quotes, Shell, Unilever, virgin, Volvo
These days it seems like business leaders are queuing up to talk about their role in society. That’s good, right? They’re saying all the right things. I’ve been hoarding a bunch of quotes – here they are below. But first – it’s always slightly scary when a new orthodoxy emerges (even when it’s yours), so some wise words from Warren Buffett:
“The five most dangerous words in business may be ‘Everybody else is doing it’.” Warren Buffett (source)
A new world view
“We are seeing the birth of a new perspective of the world, where ecology and economics are two sides of the same coin.”
Leif Johansson, CEO, VOLVO (source)
“We cannot choose between [economic] growth and sustainability – we must have both.”
Paul Polman, CEO, UNILEVER (source)
“Business is the force of change. Business is essential to solving the climate crisis, because this is what business is best at: innovating, changing, addressing risks, searching for opportunities. There is no more vital task.”
Richard Branson, CEO, Virgin Group (source)
“Solid, hardwired, rigid approaches to business are rapidly giving way to the fluid, open, flexible in literally everything we do and with ramifications we are all grappling with.”
Robert Pitfield, EVP, SCOTIA CAPITAL (source)
The company of the future
“In my view the successful companies of the future will be those that integrate business and employees’ personal values. The best people want to do work that contributes to society with a company whose values they share, where their actions count and their views matter.”
Jeroen van der Veer, Committee of Managing Directors, SHELL (source)
“The brands that will be big in the future will be those that tap into the social changes that are taking place.”
Sir Michael Perry, Chairman, CENTRICA (source)
“We see sustainability, both social and environmental, as a powerful path to innovation, and crucial to our growth strategies.”
Mark Parker, CEO, NIKE (source)
The need for collaboration
“Successful companies can only create solutions to some of the world’s toughest problems by working collaboratively. Business must engage — with communities, governments, customers and each other — because the status quo is not an option. It is not only possible for a global business leader to be a good citizen, but a requirement.”
Jeff Immelt, CEO, GE (source)
“The opportunity for businesses today is to become networks—with a culture of collaborative innovation, stewardship and integrity.”
Filippo Passerini, President, PROCTOR & GAMBLE (source)
“Business, government and civil society and people everywhere can leverage technology to work together in new ways to solve the greatest problems of our multi-polar world.”
Bill Green, Chairman and CEO, ACCENTURE (source)
“The new engine of innovation driven by collaboration, openness, stewardship and the power of the social web gives all of us an opportunity to drive even more rapid, meaningful change across global institutions”.
Michael Dell, CEO, DELL (source)
Going beyond the expected…
“It is not good enough to do what the law says. We need to be in the forefront of these [social responsibility] issues.”
Anders Dahlvig, CEO, IKEA (source)
…or not:
“Corporate responsibility is about doing the right things right.”
Paul Otellini, CEO, Intel (source)
(as opposed to what exactly? Doing the wrong things wrong? Doing the wrong things right?)
It’s core business…
“In short, we are committed – through chemistry – to the betterment of global humanity. And it is this commitment that drives all of our strategies for growth and profitability”.
Andrew Liveris, CEO, Dow Chemical (source)
“We believe that better use of information and communication technologies can contribute in a big way to economic growth while offering opportunities to address global warming.” Stephen Elop, CEO, NOKIA (source)
Tomorrow is too late
“All companies face a direct impact from decreasing natural resources, rising populations and disruption from climate change. And what may be a subtle effect now will only become more intense over the next five to ten years. Never has business had a more crucial call to innovate — not just for the health and growth opportunities for our companies, but for the good of the world.”
Mark Parker CEO, NIKE (source)
“The time to take risks is when you’re successful, not when you’re sliding down the slope.”
Tim Mohin, ex-director of Sustainable Development, Intel and Apple (source)
I’m aware that all of these quotes are very Anglo-Euro-American. Partly that’s because I don’t speak mandarin. So a final piece of wisdom from the East:
“If we do not change our direction, we are likely to end up where we are headed.” —Chinese Proverb
And if you really couldn’t be bothered to read all the quotes, I did a Wordle of the entire post, so you can get the general idea:
Image from Jupiter Images.
Filed under: Corporate Citizenship, Innovation | Tags: Corporate Citizenship, Google, IBM, Innovation, Kraft, LinkedIn, Michael Porter, Nestle, PepsiCo, Shared Value, social purpose, Unilever
Above is a visualization of my LinkedIn network (from LinkedIn Labs) – showing interconnections between networks of skills and relationships. Is this a clue to what corporates in the future might look like? It would be a big change from the old rigid structures…
I’ve been thinking about “tomorrow’s company” – not just the survivors, but the most innovative, progressive companies. Apologies it’s such a long post – but here’s seven characteristics I think the “Company Of The Future” will have.
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1. Social Purpose
2. Diffused Power
3. Distributed Activities
4. Skills Networks
5. User Innovation
6. Failure Rate
7. Ambitious Goals
Companies which thrive in the future will be those with strong socially motivated innovation. We all know that one of the most innovative sectors in recent years has been Financial Services: high-frequency trading, arbitrage, complex new asset classes … none of which had any social purpose, and all of which have had negative or catastrophic consequences. As former Fed-Chairman Paul Volker put it (maybe harshly) “the only useful thing banks have invented in the last 20 years is the ATM”.
Maybe this is why CEOs are queuing up to talking about aligning business goals with a social purpose. Take Paul Polman’s Marketing Society talk, for example: “Brands and businesses that fail to integrate consumer needs with societal well-being will struggle to grow in the future.”
Michael Porter talks about innovation in his recent HBR paper, where he describes social purpose in terms of creating shared value:
Shared value holds the key to unlocking the next wave of business innovation and growth. It will also reconnect company success and community success in ways that have been lost in an age of narrow management approaches, short-term thinking, and deepening divides among society’s institutions.
…and he concludes:
We need a more sophisticated form of capitalism, one imbued with a social purpose But that purpose should arise not out of charity but out of a deeper understanding of competition and economic value reation. This next evolution in the capitalist model recognizes new and better ways to develop products, serve markets, and build productive enterprises.
As organisations grow they become subject to centripetal forces – power tends to accumulate towards the centre, instead of diffusing through the company. Laszlo Bock, vice-president of people operations at Google, tells the EIU:
“As you get bigger as an organisation, you have to work harder and harder, and more deliberately, to unpack the biological and cultural trappings that people normally bring with them. [People] assume other people will take care of things. They assume there’s some infrastructure for them. They don’t look at every activity in the company and think first, ‘I’m responsible for everything, whether it’s my job or not.’”
Block runs Google’s Advanced Leadership Lab, which aims to have people “think like owners” rather than employees – to consciously push power out from the centre.
It’s commonplace in Silicon Valley, of course – companies who distribute their activities across a range of geographical locations – companies like Automattic, supported by a range of cloud tools like SocialCast, Yammer, and real-time group blogging on WordPress P2.
That’s just what you’d expect from Silicon Valley – and Automattic’s Tony Schneider blogs on why this works so well. But the big beasts are doing it too: the EIU report talks about GM, who are using a similar model, supported by a robust development platform for advanced engineering:
Cars are becoming more technically complex. There are constant advancements in electronics and alternative propulsion, and high demand for engineers who are expert in the field. Ms Barra believes global collaboration lets GM leverage scarce human resources and innovate more quickly, while its regional engineering centres allow it to leverage knowledge of markets.
Social networks are now a mainstream mental model. At the top of this post is my own LinkedIn Map – a nice visualization of how individuals are thinking about their professional connections. So why is the organagram still the mainstream model for management? It’s only a matter of time before organagrams get superceded by skills networks, enabling communities to form around individual interests. Companies like Royal Sun Alliance and IBM are working on developing internal skills networks, and IBM’s Social Business initiative is worth looking at.
Skills networks would have a number of benefits:
I’ve heard the word intrapreneur floating around recently – and it’s true this would boost internal enterprise. However, more interesting is the possibility of making the company more porous: the skills map and the supply chain could begin to integrate into each other.
Eric A. von Hippel at M.I.T recently completed the first ever large-scale survey of consumer innovation. His finding – in this soon published paper – is that individual consumers spend twice as much making and improving products as companies spend on product R&D. He calls it the “dark matter of innovation”.
A recent New York Times article takes up this story, pointing out how most approaches to R&D are “completely dated”. It’s not just about crowd-sourcing, co-creation, or other buzz-words; it’s about being open to collaboration with individual users, groups, stakeholders, and widening the skills network to embrace people outside of the company.
We’re no in an age of perpetual beta: getting to market and then optimizing, rather than the other way around.. low cost, high failure rate. As this Business Week editorial describes it, fail fast and fail cheap:
The math of fail fast and fail cheap is simple. If it takes six months and $100,000 to take a product from idea to customer reaction, then at best you’ll get two cycles in a year. However, if you can do a complete cycle of learning in a week for $1,000, you can get 52 cycles in a year at about half the cost.
This isn’t new – the editorial is from 2007 – but it’s becoming widespread. For example, YouTube is buying Next New Networks, a Web TV show producer with a radical new take on content development: instead of spending $1million on a pilot, spend it on a hundred pilots, and test in the market. And it’s working – they’re generating huge volumes.
Another example comes from the Bill & Melinda Gates Foundation, which recently conducted a major review which resulted in a major shift of strategy – away from “big bet” large investments, towards high volume small seed investments, capped at $100,000. As they might say in India, let a thousand flowers bloom.
Future-facing companies will understand how setting ambitious goals can unlock innovation. Some recent examples from consumer packaged goods:
