Recently, at a business event, the discussion led to the very common question: What is the ultimate goal of an organization? Surprisingly, or not surprisingly, two models dominated the conversation. First the traditional one of maximizing Shareholders value (yes, ..still!) and the second, focusing on Customer Relationship Management (CRM).
Our intention was not to go back to debating scandals as ENRON and how much “value” did these companies bring to their shareholders in the end. The shocking finding was the fact that some business leaders are still convinced shareholders are the key stakeholder group to focus on and those deserving return on their investment (even if others need to suffer for a while to achieve the right numbers to put in front of them). Further, some were lobbying for the more “advanced” strategy of switching focus on Customer Relationship Management (CRM), putting the customer into the middle of all business decisions, believing a satisfied, engaged and involved customer is key to achieve business growth.
The key shocking discovery was the underlying  “Either – Or” thinking…Shareholders or Customers. And the need to pick one. In isolation.
What some organizations, such as Costco, Whole Foods or Patagonia figured out the answer to already is: Why not both? Or wait for it….Shouldn’t we focus on all stakeholders?
The leaders of the companies mentioned above and many more, referred to as the “Firms of Endearment” (FoE) are the pioneers in mastering Stakeholder Relationship Management (SRM) practices. Proven by the research conducted by the FoE authors, the FoE companies out-performed the S&P 500 by 14 times and Good to Great companies by six times over a period of 15 years (1998-2013) – see the detailed graph below.
Their success goes beyond profit and growth. They are the ones classified as the LOVEMARKS, the BEST EMPLOYERS and the SOCIAL IMPACT CATALYSTS of the business world.
But what is SRM? And why do we see the tendency of companies moving beyond satisfying the shareholders or the customers only?
SRM is caring for all stakeholders, not seeing them as resources (if of supplies, materials, labor, money or profit) but looking at the bigger picture, seeing them as partners in making the world a better place and in achieving their overall purpose.
The Integrated Stakeholder Ecosystem
At Fortuny Consulting we work with an Integrated Stakeholder Ecosystem model, helping our clients to review their current stakeholder map, identifying the relationship gaps and business opportunities in order to accelerate their growth in a sustainable fashion.
Accelerating your growth with ISE
Interested to learn how to drive business growth by learning about the best practices for each stakeholder group? Over the coming weeks we will be bringing you clear examples and mini-case studies to demonstrate how some companies mastered this approach, offering you ideas and food for thought to introduce in your own company.
