Good business is simply about people. Really. Part 2
Does it make good business sense to treat people well--employees, partners, customers? In Part 1 of this blog, I shared some compelling data about the impact of marrying profit and purpose--an intentional focus on positively impacting employees, partners, customers, their communities and the planet on which we all live.
As it turns out, the idea that profit and purpose can and should go hand-in-hand was more the norm not so long ago, and it's becoming increasingly attractive to mainstream business leaders.
Steve Denning writes in Forbes recently that there is mainstream momentum away from the long-held belief that a company’s only true purpose is to maximize shareholder value. Interestingly, the idea that shareholder value is the only true purpose of a business didn't take hold until the 1980s. Prior to that, a more commonly held definition of company purpose was, according to Lynn Stout in The Shareholder Value Myth, “… to provide equity investors with solid returns, but also to build great products, to provide decent livelihoods for employees, and to contribute to the community and nation.”
Denning notes that a return to a more holistic view of business purpose is emerging. Leading economists and CEOs such as Paul Polman, Mark Benioff and even Jack Welch, once a great proponent of the shareholder value focus, are increasingly vocal in insisting that shareholder return is important, but that it is the result of taking care of customers and employees first.
So, do the right thing by the people that are at the core of your business and good performance follows.
On a personal level, when my family sought a new high school for our teenager this past year, we discovered a small and very unique private school. What stood out was not a shiny STEM program or exciting extra-curricular options, but a relationship-based approach to education, aimed at reengaging students with learning. Purposefully small, the school operates on the principle that the best learning happens when kids develop good relationships with their teachers. In this school, there’s no hiding, no fading into the background. It’s a place where everyone does really know your name and the care about who you are as a person. (Side-note: my teen is doing well there, showing signs of becoming that engaged life-long learner all parents wish to see).
This same high regard for real people is at the core of businesses that aim for profit and positive impact, whether they call themselves human-centered business, profit-for-purpose, for-profit purpose-driven, B-corp, triple-bottom-line or even a so-called old-fashioned business that aims to serve customers, employees and shareholders, in that order.
At the end of the day, it may not always be about who you know, but the value you place on getting to know and care about the people you do business with every day.
As I launch my own new venture, this is my personal goal—to work with passionate people, to help them realize the potential of their company’s purpose and to shine a light on the impact of doing good business and doing business well.