While I’ve completed the essays outlining the formal steps of strategic planning, I feel the shorthand used in the process has prevented me from fully defining what I expect from a socially responsible enterprise. And, what you should expect from yourself.
The second and third planks in The COMMONS Business Model platform — self-management and profit sharing — certainly fulfill the first commitment, which is to social responsibility within our companies. But the greater opportunity for social responsibility lies outside the workplace . . . in the marketplace.
As I’ve made repeatedly clear, my purpose is certainly not to create more unrestrained capitalists. Our bottom line isn’t in our own pockets. It’s in our purpose.
COWORK Entrepreneurs profit sharing isn’t just about capturing a fair share of the wealth. It’s not just to change capitalism and economics for ourselves and our families. It is also to change capitalism and economics for the sake of our friends and neighbors, our community and our country.
That’s the full scope of social responsibility.
Go back to the Red Zone and review the headings and the tweets. Those 13 essays describe the ill effects of unrestrained capitalism that reach far beyond the workplace.
Capitalism Is In the Workplace
Economics Is Everywhere
When the profits from your enterprise reach your pocket, it must not be the end. It has to be the beginning if we are to change the way economics works. It’s the start of a journey much different than the past.
To reach beyond your pockets, I want you to share those profits with the community where they can serve the common good.
Back in the Red Zone you may recall I referred to unrestrained capitalism and unrestrained consumerism as unwitting partners. It is an unholy alliance we need to break and as newly minted indie capitalists we have the motivation to do so.
As consumers we were oblivious to what we were doing when we took our money to the Big Box. Price, selection, speed, one-stop shopping was all we were thinking about. It was all about us.
The fact that we were shipping our money way off somewhere, never to be seen around town again, never entered our minds. Or if it did, we didn’t care.
As Indie Entrepreneurs We Get the Picture.
We’re in business now. If we spend our profits in locally owned and operated enterprises, we will see many of those dollars in our shops over and over again! And, as profit-sharing workers and entrepreneurs, we will see our compensation rise accordingly as revenue climbs.
Sooner than later, the fact will catch on. Others in the community, whether they are engaged in a profit-sharing enterprise or not, will begin to realize that spending their money locally will make increased compensation possible, whether in a paycheck or as a profit share. And before long, prosperity will come to everyone including the local business community as a whole.
Community leaders will love you! It is possible your government will thank you for changing economics to such an extent that there is less need for government assistance or charity. The people might even see their taxes lowered or put to better use.
It’s ‘Buy Local’ on Steroids!
Forgive me for repeating myself, but “there’s enough money to go around but it doesn’t.” The reason the Wall Street economy doesn’t benefit the local economy is because we fail to keep the money at home. So we hear the financiers and the politicians bragging about a healthy economy while our local economy is getting sicker by the sales slip.
If you follow the NME strategies and carry them through to the community, your reputation as a “rainmaker” will be recognized and rewarded many times over.
The Big Guys Don’t Get It
The irony of it is that social responsibility inadvertently serves our own self-interests while serving the common good.
By and large the big corporations don’t get that. They’re learning. But the very fact that they are large, not local, focused on shareholder value, not human value, makes real social responsibility difficult if not, in many cases, impossible.
Radical change just isn’t in the corporate vocabulary. Remember, I shared with you my own experience in knowledge management 20 years ago when all but a few of the Fortune 500 companies gave lip service to the value of humans as intellectual capital but couldn’t change the time-worn ways of management to suit the nature of intangible assets they didn’t own.
They’re still playing with KM like a cat plays with a mouse.
Social Responsibility as a PR Ploy
Same goes for social responsibility.
I admit I’m overly suspicious when a large corporation brags about its social responsibility. My bias probably stems from my days in public relations.
I was working for a non-profit community hospital when the news broke that President Ronald Reagan had been diagnosed with colon cancer. I immediately saw a great opportunity to capitalize on the media buzz by having the hospital offer free colon cancer screenings as a “public service.”
Admin liked the idea, but the lab rats didn’t. They would be the ones to read the screens. But the kits were free and so Admin saw it as a free ride in our never-ending competition with the nearby university hospital.
Floods of people came through the front door and we were quickly running out of kits. I drove to the next town to borrow more from another hospital and the project was a great success. We were clearly “the community hospital” and for a moment we proved it.
But our motivation wasn’t to do good. It was to earn points that would ultimately pay off on the bottom line.
You might be surprised that a non-profit hospital would be focused on the bottom line. Well, our customers were really the doctors, not the patients. The doctors were all for-profit entrepreneurs and they ruled the roost. They loved hiding behind our image of public service while receiving new patients whose test results led to increased revenue.
I’m sorry. I really am sorry, but that’s what I see when I see most reports about this or that corporation engaged in some sort of “socially responsible” initiative . . . “giving back to the community.” Please. Why not take less in the first place?
Social Responsibility in the DNA
There are exceptions in the for-profit sector. Here are six large companies whose social responsibilities lie at their cores.
- Burt’s Bees: Wellbeing and “the greater good” has always been the focus of this company. As a member of the Natural Products Association, the company helped develop The Natural Standards for Personal Care Products, which created guidelines for what can be deemed natural. Since the Burt’s Bees startup at a crafts fair selling $200 worth of honey, the company now produces more than 150 products and reached $5.7 billion in sales last year.
- Pedigree: The company built its brand by focusing on the need for people to adopt homeless dogs. Pedigree’s immediate goal was to use its profits to distribute $1.5 million in grants to 1,000 shelters and breed rescuers. The beat goes on. Today Pedigree donates one bowl of food to animal shelters every time it gets a Facebook fan. The ultimate goal is to donate four million bowls of dog food, enough to feed every sheltered dog in America for one day. Today Pedigree is the world’s wealthiest pet food supplier.
- Method: As a cleaning product, Method hit the jackpot. While cleaning products historically contained hazardous chemicals, Method was able to make safe and effective cleaning products from natural ingredients such as soy, coconut and palm oils. Now with an annual revenue of more than $300 million, Method proves socially responsible products can be wildly successful.
- The Body Shop: Regarded as a pioneer of modern corporate social responsibility, founder Anita Roddick led her company to stand up for its beliefs and champion its causes such as self-esteem, environmental protection, animal and human rights.
- Ben & Jerry’s: The partners infused the company with social responsibility including “linked prosperity between the company, its employees and the community” from the very beginning. They founded the Business for Social Responsibility organization and donate a full 7.5 percent of pretax profits to causes worldwide. Reports indicate the current owner continues to follow these guidelines.
- TOMS Shoes: Blake Mycoskie started TOMS Shoes with the plan of donating a pair of shoes to a child in need for every pair of shoes he sold. He went to Argentina where he saw shocking numbers of children without shoes. At the same time, he recognized that consumers want to feel good about what they buy. In his first four years in business he donated more that 400,000 shoes, proving him right. Consumers clearly embraced his cause.
In every case, social responsibility was in the DNA from the startup. Social responsibility was not a gimmick to gain market share. The motive was to genuinely serve the common good. The benefit to the companies came as a bi-product, not as a return on investment!
Doing good is surely good for business, but the difference is in the purpose and the purpose is in the DNA, upfront and honest.
Your small business startup doesn’t have to have such lofty goals. Just the commitment to shop local, keeping the money working for the community adds to the advantage you already have as you plow new ground in the economy with a business model and a personal commitment with social responsibility in the DNA.
Your strategic plan and all that grows out of it should prove your worth to the people and the community. You need to make it clear what the term “social responsibility” means to you in real terms and what the benefit is to your customer, your community and your country.
We’ll get into the tactics of social responsibility when we reach the Green Zone. Meanwhile, I have one more topic I need to cover before we leave strategic planning.
Please move on to the next essay
Six Capitals of Capitalism