Principles/ Stakeholders
|
Purpose Leadership
|
Shareholder Leadership
|
Purpose
|
-
The No. 1 priority is to protect and fulfill the purpose, financial and other goals, objectives of the organization, consistent with its stated values.
-
Customers, talent, and other stakeholders and the environment are viewed as assets to be nurtured.
-
The focus is on creating value for all stakeholders, rather than looking for ways to subtly shortchange customers, employees, supply chain and distribution partners, communities, and the environment.
-
The organization makes a commitment to not offload its costs on to society as many do by underpaying employees, shortchanging customers, polluting or damaging the community.
-
The organization has a purpose statement, goals, objectives, and values upon which all business leaders and employees are measured at least annually, with infractions related to values dealt with seriously and transparently as appropriate to privacy.
-
Senior management is compensated based on fulfillment of the purpose, goals, objectives consistent with stated values.
-
Every effort is made to align the purpose of the organization with those of its key stakeholders--customers, employees, supply chain and distribution partners and communities.
|
-
The No. 1 priority is to make investors happy, with a focus on maximizing profits often in the short term by “efficiently” managing costs related to customers, employees, supply chain and distribution partners, without serious measurement of long-term or often even short-term consequences on satisfaction.
-
Customers, talent, and other stakeholders and the environment are viewed as resources to be tapped, especially when financially necessary or desirable.
-
The organization looks for ways it can offload costs by paying people as little as possible, providing few benefits, deceiving or poorly serving customers, shortchanging supply chain and distribution partners, polluting, or damaging infrastructure.
-
The organization has a purpose statement but very few people in the organization know what it is or follow it.
-
Senior management is compensated based on short-term or other financial goals.
-
Little regard if any is given to the purpose of any stakeholders other than as expedient.
|
Values
|
-
In addition to having a clear purpose statement, the organization’s values are clearly articulated and used as a guidepost when making tough decisions and trade-offs.
-
The values are regularly communicated to all stakeholders and appropriate appreciation is transparently expressed by leadership to stakeholders whose actions embody these values.
-
When trade-offs require compromises, key stakeholders understand why.
|
-
There are no stated values, or they are simply words on a wall.
-
Decisions and trade-offs are finalized based on short-term or other financial considerations or to protect insiders.
-
Little to no appreciation is expressed for people demonstrating the organization’s values.
|
Financial Goals
|
-
The No. 1 priority is to generate a return on assets over time rather than focusing on a return on capital invested or whatever the stated financial goal of the enterprise.
-
Decisions are not based on hitting short-term goals that could jeopardize long-term performance unless necessary for survival or regulatory compliance.
-
Financial goals are continually weighed against the purpose, goals, objectives, and values of the organization.
|
-
The No. 1 priority is to meet quarterly or other short-term financial goals as promised to investors.
-
There is little concern given for making cuts that could affect customer or employee loyalty or other stakeholders over time because there are no clear metrics being measured.
|
Business Operating Systems
|
-
The organization has a business operating system to achieve its purpose, goals, objectives, and values.
-
There is a clear operating plan for each stakeholder group and regular meetings with all leadership to ensure alignment and to address challenges and opportunities.
-
Customers, talent, and other stakeholders and the environment are viewed as assets to be nurtured and whose voice must always be proactively heard and acted upon.
-
Every effort is made by the CEO to break down siloes and to foster ongoing collaboration between all organizational units, sales, marketing, customer service, human resources, finance, operations, administration, legal, IT, etc.
|
-
There is either no clear business operating system with clear roles and responsibilities, or it is ad hoc.
-
Or the business operating system and metrics are considered so important they often overlook the role of talent or other human factors that can affect outcomes.
-
Little effort is made by the CEO to break down siloes between all organizational units, sales, marketing, customer service, human resources, finance, operations, administration, legal, IT, etc., leading to ongoing tensions, struggles for resources, and blame games.
|
Shareholders
|
-
The organization clearly discloses to shareholders its purpose, goals, and objectives, financial, and otherwise; the financial and other metrics it uses to measure progress and the basis upon which it makes tradeoffs, and seeks investors who buy into its vision.
|
-
The organization makes commitments to shareholders based generally on short-term or large-scale long-term pay-offs, with no explicit commitment to a purpose, goals, objectives and values to which it commits itself to in a measurable way.
|
Employees
|
-
The organization has a strategic and systematic process for listening to employees, encouraging innovation, acting rapidly to input, and systematically expressing appreciation for those whose actions contribute to the purpose, goals, and objectives or embody its values.
-
Employees who create value are not laid off to meet short-term financial goals if those cuts could do damage to long-term return on assets or stakeholder experiences.
-
Employees are only terminated for performance or values issues, or when economic, market, or structural financial challenges and risks force the organization to reduce fixed costs.
-
Employees receive training and professional development based on a mutual career laddering strategy.
-
The company invests in job design to ensure an enriching win-win employee experience.
-
The organization uses metrics relevant to its purpose, goals, and objectives to track the impact of its investments in employees as well as effectiveness of management.
-
DEI is viewed as a source of value creation—having more diverse employees and distribution partners opens new markets for customers supply chain partners and more welcoming communities.
-
Unions aren’t feared because all stakeholders are actively heard.
-
Employees have opportunities for profit-sharing and gainsharing.
|
-
All except the C-suite and top sales performers are viewed as fungible resources and a cost to be minimized as much as possible.
-
The organization has no strategic process for listening or fostering innovation. If it conducts employee surveys, it does little with the results.
-
Short-term financial goals are more important than work-life balance or ensuring all employees earn a living wage.
-
Talent is not considered a measurable differentiator; therefore, management appointments and recruitment are often based on personal connections.
-
Rewards and recognition are largely given to senior management and sales performance, and more perfunctorily to other employees.
-
Employees receive training and professional development only as needed.
-
Unions are viewed as a public enemy.
-
DEI (diversity, equity, and inclusion) are viewed as compliance issues.
-
There are little more than pro-forma opportunities for employees to participate in profits or gainsharing.
|
Customers
|
-
The organization has a strategic approach to expressing appreciation to customers.
-
DEI is viewed as a business opportunity, not a compliance issue.
-
The organization has very clear metrics for measuring effectiveness of customer engagement consistent with its purpose, goals, and objectives, and management is measured by and rewarded based on those results.
|
-
The focus is on attracting customers but not as much on keeping them: far more is spent in marketing than in fundamentally delivering the promises.
-
Customers are seen as a source of short-term value extraction, shrinking packaging, reducing ingredients quality, increasing prices when possible, making dubious product and service claims, etc. all are considered as ways to optimize short-term profits.
-
DEI is considered a compliance issue.
-
The only clear metrics for measuring customer relationships are financial; little analysis is given to post-sale satisfaction and social media impact.
|
Distribution Partners
|
-
Every effort is made to form a partnership mentality with anyone who helps bring the organization’s products and services to market, starting with a built-in listening process to continually identify the best ways to help these channel partners succeed bringing the organization’s product to market.
-
Distribution partners are actively appreciated for their contributions and are rewarded for their commitment.
-
Distribution partners can count on the organization to look after their interests in making tough trade-off decisions.
|
-
Resellers are considered a necessary evil or a cost of doing business and therefore are treated at arms-length except as necessary in case the organization wishes to change direction.
-
Distribution partners are never 100% certain they can trust the organization to not change its mind and go directly into competition.
|
Supply Chains
|
-
Appreciation is authentically expressed for contributions to success.
|
-
The supply chain is a cost to be reduced as much as possible.
-
The goal is to squeeze suppliers as much as possible on price and payment terms.
-
Suppliers never know when the business will be put out to bid and on what basis.
-
Friends and family get preference.
|
Communities
|
-
The organization seeks to create value for the physical or business community in which it operates consistent with its purpose, goals, objectives, and values—such as investing in local education or other activities that can help develop new employees, distribution or supply chain partners, or customers.
-
The organization makes a point of staying out of politics unless the issues are directly related to its purpose, goals, objectives, and stated values.
|
-
The organization makes donations to causes that it hopes will counteract its neglect or worse related to its impact on the community.
-
Donations are made either to politicians or parties considered generally favorable or split across different parties to make sure the organization has a voice when necessary.
|
Environment
|
|
-
Environmental and waste issues are considered compliance or public relations issues.
-
Public pronouncements are made, and some steps taken, but otherwise every effort is made to minimize short-term costs.
|
Transparency
|
-
Because the organization considers its strategy provides a competitive benefit, and already keeps track of critical practices, metrics, and performance improvement processes, it publishes an annual corporate sustainability report that provides meaningful information on how it creates opportunities and risks for all stakeholders.
|
|