Business - at its core, remains profit centric. Albeit, with changing times, the definition of profit has transcended beyond that of just monetary gains - and onto more. The power of the organisation on the socioeconomic paradigm, its reputation - perception of not just the stakeholders, but the general public as well, have become facets of that new definition; with it, a new and often vague sense of stakeholder priority. One that can led to unintentional mismanagement - with conducive conclusions.
A few weeks back, The Economist published an article titled, "Keeping stakeholderism practical". The write up delved into the rights and wrongs of management books on social issues - discussing four books by doyens of the topic. The books were: "Trailblazer" - written by Marc Benioff, who is the chairman, co-CEO, and founder of Salesforce and a pioneer of cloud computing; "Green Swans" - by serial entrepreneur John Elkington; "Restoring the Soul of Business" penned by Publicis Groupe Chief Growth Officer Rishad Tobaccowala; and "Share" - co-authored by Chris Yates, the general manager of Learning & Development at Microsoft and Linda Jingfang Cai, the Global Head of Learning and Talent Development at Aon. The four weighty tomes argue that companies have a broader purpose than simply making a profit, and pivot into issues that a modern manager should be aware of; and also be capable of handling.
Worries of a modern business executive go beyond the balance sheet. They are told to be aware of their company's environmental impact, of how well they treat their employees and suppliers, and whether their workforce is sufficiently diverse in terms of gender and ethnicity. The pressure can drag on from customers unhappy with the company's stance on an issue. At times even employees may demand that their firms take action against an issue or objection: Even Google had to drop a contract with the Pentagon after workers complained.
Any modern business is aware of the environmental, social and governance decision they make or are prone to make - without the push. However, the danger is that managers may use these books to have an opinion on every social issue of the moment.
Social entrepreneur John Elkington co-founded SustainAbility, an environmental consultancy; the idea behind "Green Swans" is to focus on changes in the economy that will lead to environmental breakthroughs, but his message is lost in a miasma of mixed metaphors. In the space of two pages he writes about "10x thinking", "an exponential mindset" and the "Chrysalis economy", while warning that the world is both heading into "some sort of historic u-bend" and backed into "the mother of all corners". However, the author failed to delineate quite how a corner can have a mother.
Yates and Cai fell into a different trap with their jointly written "Share". The dust jacket promises a book about "new business models based on sharing, reciprocity and co-operation". Instead readers get a rambling mix of personal biography and economic history.
Marc Benioff offered more immediate useful lessons in his "Trailblazer" - his personal history of how he built his software giant, while donating one percent of its services, profit and employees' time to help non-profit organisations and charities.
"Companies and their leaders simply can no longer turn a blind eye to the issues that matter to their employees, their customers and the communities on which they do business," he argues in the book.
Salesforce opposed a bill in Indiana that would have allowed business owners to discriminate against lesbian, gay, bisexual, transgender and queer or questioning (LGBTQ) customers. Following Benioff's intervention, Indiana's then governor, Mike Pence, revised the bill to prevent such discrimination. The book provides some useful lessons for chief executives who might assume their company is free from bias. Marc Benioff admits that for a long time he assumed his company paid sexes and races equally. But a review showed that it did not and three rounds of pay adjustments were needed before equalisation occurred. This focus on social issues has not stopped Salesforce from making money for shareholders. It also regularly ranks as one of the best places to work.
The plausible best of the books would be Tobaccowala's "Restoring the Soul of Business". The book offers sensible and practical suggestions; some of these include assessing all meetings to eliminate those that waste time; and suggesting that all employees spend 20 percent of each month trying to enhance their skills. The author projects a clear focus: how to ensure that one can hire, then inspire, the right workers in the knowledge economy.
"Employees who find work meaningful are highly productive, agile and committed," he writes, adding that talented workers are in a more powerful bargaining position in the current economy. He also argued that companies can be too obsessed with data, and not enough with employee motivation: "The best businesses find ways to marry the math and the magic."
The books on management - a mélange of both its micro and macro aspects, reflect on how companies can pursue both broader social goals and the desire to grow; and it is argued that the aims are complementary, rather than contradictory. They also demonstrate the benefits of practical advice over grand philosophising about every social issue of the day - lessons applicable for managers who aren't writing books.