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The Quiet Revolution - How Social Progress Became An Economic Imperative

Apr 3, 2008
Seven years ago, as the Millennium turned, my US buddy Jim Armstrong looked out of our Liverpool office over the River Mersey and told me that a business was not a brand to be built, it was a cause to be believed in.

It was a claim that felt at the time to be a bit rich for the palate of the UK boardroom brought up on a diet of shareholder value. Although I was convinced by the sentiment, I knew that the hard-headed directors I had known in my working life would find the idea on the fringe of business common sense.

My view changed considerably when the RSA invited me to take on the deputy editor of The Economist in a debate about the purpose of business at their historic venue in London. The Economist had just run a special supplement ridiculing CSR and re-affirming the idea that business was about money and only money.

Interestingly, as we waited for the battle of ideas to begin, I was told by the opposition that their readers had already decided the debate - the posse of chief executives and finance directors who subscribe to The Economist had already written to the paper to disagree with its stance.

Now, an army of leading companies have revisited the purpose of their businesses. Microsoft describes itself as helping people achieve their potential through technology. GSK is committed to helping people live longer, healthier lives. Phone companies help connect people to each other.

In fact, what we are talking about here is classic marketing. If companies deliver products and services that improve people's lives they will be successful. Shareholder value will follow.

While this is a dramatic change from a once dominant mentality that used customers as a vehicle to deliver for shareholders, it is only the beginning of the story.

In 2001 I found myself in Dublin listening to Eric Friedenwald-Fishman who runs the successful Metropolitan Group in the US. Eric was sharing the theory and practice of Public Will Building - how to get huge swathes of people behind a common cause. The theory was based on the idea that you cannot impose your set of values on someone else. All you can do is seek to understand their values and then show how you can help them live their values. The theory had terrific resonance with me.

Around that time I had also noticed a big increase in marketing bucks being spent on earning customer trust. Marketing directors had begun to hear a tune their customers were playing and they saw opportunities to build emotional loyalty by singing along.

My instinct told me that their interest was tactical and that they had probably not invested in significant research to get under the skin of customer trust - to learn from Eric and discover the priorities and the beliefs that influenced people's buying decisions.

Then, last year, six leading edge companies supported a piece of independent research commissioned by Corporate Culture. This was the first Customer Trust Index. Its results confirmed my conviction that we buy products and services that help us live the lifestyles we seek.

On its own that is not altogether surprising. Perhaps more revealing is that the research revealed that what we believe influences what we buy. Two thousand customers agreed with Eric's theory.

So far then, my journey had led me to two personal revelations. First, that the purpose of business is to create products and services that improve people's lives. Second, that successfully selling products and services depends on an in-depth understanding of the lifestyles, values and belief systems of customers.

But behind this is a tsunami of change - hinted at by Ricardo Semler in his book Maverick. Ricardo is a successful Brazilian businessman who recognized the power of setting a direction and then gifting control over delivery to employees. He has taken this so far that his employees set their own salary and recruit their own managers.

Today, technology is allowing this idea of gifting control to be taken to customers. At Proctor & Gamble, customers are involved in creating new products. At the BBC, people are invited to tell their own stories and create their own news. Everywhere, people are claiming more control or being invited to take it.

So let's take this a little further. Let's imagine each organization has a clear direction to improve people's lives. Let's imagine delivery is informed by the beliefs and lifestyles of customers. Let's imagine they are involved in creating new products.

But there's a potential problem. How can we secure long term success? External issues increasingly seem to be getting in the way. The success of business is being affected by shortages of skills, climate change, an aging population and many other factors. The social issues that were fringe to economic success ten years ago now dominate the business pages.

In my view, the big change is yet to come. Currently we imagine these social issues as an ethical imperative or a risk to be managed. Real change will only come when there is universal understanding that these social issues have an economic imperative - and collaborating to fix the issues will create richer, stronger markets.

In the UK, the Stern report said it was probable that global warming could bite between five and twenty per cent off the UK's Gross Domestic Product. For the first time, the inconvenient truth was an economic imperative.

And that economic imperative applies to other issues. It is an economic imperative for action if 50 per cent of children start school functionally unable to communicate, if one in six pupils leave school without the basic numeracy or literacy skills business needs and if 20 per cent of children in Europe are living in poverty.

In practice, this means that these social issues are no longer the stuff of well meaning community investment programmes. It means they are the domain of marketing directors, whose focus should include the creation of sustainable market environments.

And that is where we are now. Around the world companies are gradually realising the opportunity. They have a choice. They can be bit part players, where they trigger activities to be seen to "do their bit" and generate limited PR. Or they can provide active leadership, involving customers in creating products and services that improve their lives, and collaborating with others to achieve real social change to create richer, stronger markets.

There has never been a more exciting time to begin a career in communications. The worlds of reputation and reality are now unified, and the required skills are changing. This new breed of communicators enable dialogue, they are strategists and change agents, with experience across audiences and sectors. They have passion and they have purpose. They are, genuinely, children of a revolution.
About the Author
John Drummond is Chief Executive of Corporate Culture, a communications and campaigning business based in Liverpool and London. For more information on building customer trust or delivering change for good, visit the Corporate Culture website here http://www.corporateculture.co.uk
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