Public opinion increasingly represents a clear and present threat to business and it will be difficult to remain relevant unless businesspeople can clearly state what they stand for, says Five Horizons author, Steve Sanders
All business leaders are relied on by stakeholders to make the best decisions with regards to the impact their company will have on them as individuals, their interests and their income. Companies that perform well for their stakeholders tend to secure even greater success for the business in the future. But how can leaders articulate this and execute it, especially when it comes to persuading shareholders and directors that some ideas are the right strategic choice?
The need to satisfy and act on an implicit duty of care to all should be the priority for businesses. They are accountable to customers and shareholders first, but also employees, suppliers, the environment, and communities, wherever they make an impact. This is in addition to remaining responsive to government and regulators at home and in all markets, and amid a changing profile of investors or lenders.
A ‘Great Shift’ is around the corner
During the next 10 to 15 years, humanity will fundamentally change in terms of what, how and why we buy and consume, and why we decide to work for any given company. The governments and businesses our elders run are responsible for all global societies reaching a precipice of globally catastrophic proportions. As a result, the attitude barometer is moving very, very quickly. Public opinion, among those generations soon to be aged 20 to 50, increasingly represents a clear and present threat to business.
Market conditions are shifting, and the race is now on. Either your business or another will be the first company in your competitive environment attaching a brand to a set of principles or a purpose that is important to your target audience.
Businesses will act or be left behind
The threat of being outrun by competitors should be enough to motivate shareholders and directors to invest in ways to navigate that shifting new norm. This is likely to become one of the greatest causes of discontinuity in businesses that we’ve ever seen. This ‘Great Shift’ will be a pan-sector disruption event second to none. Even now, it is simmering away in the background of every industry and competitive landscape. Employees and customers are just waiting for viable alternatives to arise. As soon as alternatives appear that better serve a burgeoning and overwhelming desire for satisfaction, the dial on employment and buying choices will move without warning.
Change presents an opportunity
Yet, by pinpointing more precisely who and how their impact can be changed for the better, change gives businesses a positive opportunity. This is a key enabler for future success in business. It will be difficult to remain relevant unless businesspeople can clearly state what they stand for. This could be in terms of values and principles-led strategy, or simply the impact that is being made in the interconnected value chains of their ecosystem – both positive influences and actions to resolve previous negative effects.
Business leaders need to look ahead and think about the scenarios that could arise in the future and try to identify potential vulnerabilities or opportunities in their ecosystem’s interconnected value chains. Doing this will help organisations decide how and when to act in response to unforeseen events as they unfold, using scenario planning and monitoring changes as they occur.
Ideas come from your people
You don’t need to look far to find the sources of ideas. Listening to your own people and asking your business ecosystem with genuine curiosity will help you uncover the ideas and changes that are desired most urgently by consumers and employees, and the principles that will result in their loyalty. Some key actions to take are:
- Aligning your business with global issues that matter deeply to most people at a human level, regardless of the scale of impact. This is likely to resonate immediately and could be a vital differentiator for your business.
- Embracing the nonconformists and contrarians out there because they are the ones who will take your business in unforeseen directions.
Translating ideas into actions
To form coherent arguments, business leaders should learn to use frameworks, methods, tools and techniques, professionally and wisely. Get some help and become better at using the insights gained. Getting this right will directly improve financial performance and will result in increased company-level valuation. This is at the heart of your ability to convince directors and shareholders of the reasons why your choices are the right strategic decision – for survival and for improved profit.
By being inclusive of people in your team and across your ecosystem you may create a force of evangelists that will spread news of your business’s purpose-led differentiation. To make sure their choices are right, leaders should encourage respectful challenge among that cohort. It also ensures the business is reactive to changing dynamics that its people might discover before leaders can.
Your deadline to act is now
There are more than 200 million businesses in the world and collectively, we are able to have more impact than any other community can. However, this impact must be preceded by an opening up of people’s minds. There must be widespread acceptance that doing good and having a better impact throughout the value chain and supply chains is now a matter of business survival, not simply a nice-to-have icing on the cake.
It’s likely that business leaders will doubt this because they haven’t witnessed it before. Nobody has. The truth is, that we are at a crucial moment in the history of our species, at which it appears we are failing to act judiciously, expeditiously or with respect for the significance of our historical duty. What is more pitiful is that an addiction to consumerism and an insatiable thirst for perpetually growing profit – our basest human urges – seem likely to precipitate our fall.
Whether this ‘Great Shift’ is an opportunity or a threat for organisations will largely be determined by how they react, and the course of action they choose to take. Will they act now or opt to wait and see? I sincerely hope you make the right choices.
Steve Sanders is an entrepreneur, the author of Five Horizons and market strategist at Business Growth Mechanics. He is also a Fellow of the Institute of Directors and an MBA strategy guest speaker.