Business Vision: I was recently asked by a major corporation to prepare a talk on "Business vision" and how to create them. I told two stories one of Citigroup a massive bank and it's flawed vision and one about a much smaller clothing business Patagonia and it's inspirational leader.
This screencast is a 20 minute version of the hour presentation buts gives you the key points of the stories.
The key points illustrated by these compelling stories of success and failure around setting a business vision are:
Business Vision requires leadership that listens and learns but can also lead from the front
Business Vision requires head and heart to be compelling
Business Vision needs to be creative but also pragmatic to be effective
As rare as a diamond is finding a mission statement that reflects the real purpose of a business.
It is rare to come across a corporate mission statement that mentions making money. But businesses have a responsibility to maximize return for their shareholders so why is it shied away from? Because most businesses have lost the honesty and bravery needed to present the value equation to customers transparently: we make a fair return when you get a good service. And that’s because many businesses don’t make a “fair” return but they “game” the consumer and make extraordinary, unjustifiable returns and in many cases they don’t deliver a “good” service but a poor one.
Even more unusual is a mission statement that actually inspires. Most corporate mission statements are complete and utter rubbish, full of stereo-typical and generic promises that mean little to anyone. They rarely tell you what the businesses does or what it cares about but rather reflect what the corporation thinks we want to hear.
Perhaps it is time to sit back and think up powerful mission statements that represent the truth about making money for delivering new, exciting and good products and services to our customers. Then we can ask ourselves whether this truth inspires us to get up in the morning and go to work.
For the complete guide on how to create trust in your businesses and brands get your copy of Why Should Anyone Buy from You? BUY NOW
Just back from a trip to America and having spent far too long in airports over the past couple of weeks I was reminded of Jane Jacobs 1961 book The Death and Life of Great American Cities, and her powerful description of the ‘daily ballet,’ happening on the streets. The mass movement and information exchange between strangers going about their daily business which can be observed and felt on busy streets and places like crowded airports.
Walking among strangers in an unfamiliar place has always had a certain piquancy to it…but these uneasy feelings are now more and more common even as we make our way around our own communities and countries. In airports the constant checks and universal CCTV and security presence makes one feel the oppression of the lack of trust in the travelling public and far from being reassuring it makes me feel on edge.
It is this environment of nervousness and suspicion that makes it harder for us to be comfortable around each other and benefit from the formal and informal interactions of walking with strangers. Our response is to naturally spend more time alone or in close family groups, in our cars and homes and less out in our communities. We lose the sense of ourselves as citizens living together with others in society, and often replace this with other roles – like ourselves as consumers.
And thus, marketing and many other businesses benefit as we replace community with consumption. The impact of these changing modes of interaction and atomisation of society are far-reaching. We trust less, we assume more negative intent and we destroy our very ability to trust, denying ourselves the opportunity to learn and interact with others, and in the process, blunt for good our skills in trusting.
For the complete guide on how to create trust in your businesses and brands get your copy of Why Should Anyone Buy from You? BUY NOW
Brands and businesses always want to be trusted. But rarely do they trust their customers to understand how business works. This is why most organisations mission or values statements don’t include simple direct statements of what businesses are there, in part, to do which is make money. Businesses and corporations assume that we distrust them and therefore act defensively. In some cases, often the high profile ones, covered by the media, this default position of distrust is right but the vast majority of businesses, those that many of us work for, and employ our friends and family members, are full of good people trying to deliver well for their customers and make a fair profit in return, and money for themselves.
But most businesses, especially the big ones, are pathologically scared of saying anything that isn’t on message. And those messages are devoid of reality because they just don’t trust normal people to understand that running businesses is not easy, a balancing act and they have to make a return on their efforts. The cancer in these organisations are the public relations and corporate affairs departments that are obsessed with controlling the message, saying as little as possible, and where success is staying hidden.
In my experience most people are fair and reasonable. We understand that businesses need to make money, but we want them to give us good services and not exploit us for super-profitability. But most corporations treat us like we are cynical, conspiracy theorists or anti-business. And this has created a culture, especially in Britain, France and Germany, where making a profit is seen as inherently exploitative and almost immoral.
Witness John Petter from BT this morning (12th Feb 2010) on BBC Breakfast. Since BBC doesn’t replay Breakfast (can someone upload the interview to YouTube? YES ITS HERE) I’ll give a sense of the Tweets that were going round that summarise his performance:
jhemusinsignia: BT spokesman on BBC Breakfast was v.poor: why are people lacking the necessary skills put forward? Train them or use someone else
charlie74: BBC Breakfast presenter grilling the BT rep on TV… loved it
Tommy_Hill: Anyone else think the BT guy was seriously floundering on BBCBreakfast? “I don’t know if we’ll make money on it”.. Bulls**t
zenemu: #BT chap who was just on the BBC was a bit of a worm. BT are changing free evening calls from 6pm to 7. Odious little man from awful company
RAIPR: Wtchng John Petter, BT directr justify 7pm off-peak move on BBC. Nervy, defensive, dncng feet, looking away from cam, stuttering #fail
imogenfarr: Anyone see the BBC Breakfast interview with the squirming BTspokesperson? Blimey, he’d never have coped if he was interrogated by Paxman.
There is no doubt that his performance this morning was very poor but I suspect rather than being a consequence of not enough media training, it was caused by too much media training. Having been through several versions of this torture myself these sessions are focused on Corporate Affairs/Public Relations/Media people drilling you. “Don’t say this, say that”, “don’t answer questions directly” and most importantly don’t tell the truth. Don’t lie, don’t tell the truth, better to not say anything at all.
This goes right to the heart of the way that businesses present themselves currently. There is no longer a recognition, a trust, that we understand how businesses work. Read the mission and values of BT (taken from their website this morning):
Our vision is to be dedicated to helping customers thrive in a changing world. The world we live in and the way we communicate are changing, and we believe in progress, growth and possibility. We want to help all our customers make their lives and businesses better with products and services that are tailored to their needs and easy to use.
This means getting ever closer to customers, understanding their lifestyles and their businesses, and establishing long-term relationships with them.
We’re passionate about customers and are working to meet the needs they have today and innovating to meet the needs they will have tomorrow.
Our corporate identity defines the kind of company we are now and the one we need to be in the future.
Central to that identity is a commitment to create ways to help customers thrive in a changing world. To do this we must live our brand values:
Trustworthy – we do what we say we will
Helpful – we work as one team
Inspiring – we create new possibilities
Straightforward – we make things clear
Heart – we believe in what we do
We are committed to contributing positively to society and to a sustainable future. This is part of the heart of BT.”
I can guarantee that John Petter and his boss Gavin Patterson spend most of their time obsessing about how they can organise their business to make money, grow and be cost efficient, whilst giving a good service. That’s what they get rewarded for. And yet making a fair return, making money for themselves and their employees, is no where to be seen in the mission and values of BT. These vision, mission and values statements have become divorced from reality, and its not just BT that suffer this problem.
Every business person that goes through a media training torture session comes out scared to death of saying anything, and is certainly left with the impression that having an open conversation about working hard to deliver value whilst making money is completely “off message”.
That’s what you could hear this morning from Mr Petter. His message was “buy unlimited packages” and he automaton-like repeated this time and time again. Charlie Stayt asked for a commitment from him that the prices would always be better value now and in the future, something which was impossible to answer on the couch in a studio. But instead of calmly responding, as Mr Petter might in a normal conversation with you or me, that BT always wanted to be good value, but that these decisions needed to be properly planned his only reply was “buy unlimited packages”. He thereby demonstrated that he didn’t trust those listening to his interview to conclude that he was a reasonable man with a reasonable approach and, yep, these things generally needed to be thought about.
Even when Susannah Reid asked him directly why he didn’t just explain that giving customers free calls meant that they didn’t make enough money, he wasn’t brave or trusting enough, to agree and admit that giving a good service and making a fair profit was what they were trying to do. All he could say was “buy unlimited packages”.
I felt sorry for John Petter this morning, a classic victim of media training where the goal is to say nothing, and a corporate and cultural context where trusting people to understand that businesses are there to try and give good services that we all need, and make a fair profit in return, is unacceptable.
Unfortunately until brands and businesses start to wake up to the fact that trust is a two way relationship, they will never win our trust.
Did you see the interview this morning. What do you think?
Do you work for BT? How did you feel?
Have you been media trained? What is your experience?
Please comment below and share with others using the social media icons.
Thanks – have a lovely, non-business, non-brand, non-marketing weekend and Valentine’s day.
Yesterday I attended a talk at the RSA by John Lanchester who has recently written a book called Whoops! about the credit crunch.
The talk and subsequent questioning was mostly about the role of culture and regulation in banking; with the audience and speaker exploring how to develop a system that might be more sustainable.
I wrote a blog called Banking and the Common Good a while back which explored how the concept of common good could be placed as a central focus of a financial institution. Today’s blog picks up on some of these concepts.
The question is how we create a banking system that actually balances commercial objectives with social objectives that deliver benefit to the common good. I believe that a new language of responsibility needs to be imposed on the banks. Nearly all banks will tutor their leaders in Business Ethics; all banks have values statements that will include some version of “doing the right thing”.
But despite these words and intentions we still have a system that doesn’t in aggregate and from a macro-economic perspective deliver “the right thing” and act ethically in its impact. The frustration is that there are very few financial institutions that deliberately act in a clearly unethical way decision by decision, action by action, but in aggregate the effect is destructive.
The heart of the issue for me is one of what banks, especially investment banks, markets focused institutions and bank leadership more generally, value. And that is money, to this everything else is subservient. This is why banks are so successful, they have created extremely efficient systems for maximising profit to the exclusion of virtually all else. This creates inattentional blindness, which is the psychological phenomenon of being “blind” to anything apart from that which you are concentrating on, add hubris and you have a system that builds risk and is narrowly focused on one immediate outcome.
This valuing of one outcome only, with little assessment of second and third order effects and impacts, allows for a culture to become devoid of morals. And that moral bankruptcy turned into financial bankruptcy.
So what to do? Remembering that business ethics and values were taught and “on the wall” at our big financial institutions and offered no protection.
I would advocate a complete reversal of the incentive systems at our banks. We need an incentive system that puts most emphasis on demonstrating moral action and joined up thinking rather than seeking risk for greater return. This should be in an overtly, openly discussed moral framework. Leaders in these organisations need to become expert not just in maths and playing the markets, but seeing the impact of their business on different stakeholders and balancing this for commercial and social return.
Morality is at the very heart of our economic system. Adam Smith’s conception of markets was built on predictable outcomes between buyer and seller. The foundations of these predictable outcomes, in a time when regulation and rules of commerce were much less regimented and established than they are now, were moral action from individuals. I don’t think it is surprising that The Theory of Moral Sentiments, that Smith wrote 15 years prior to The Wealth of Nations and the majority of the books in The Wealth deal with how individuals living in society should conduct themselves. In order for the invisible hand, specialisation and the market dynamic to work as a value exchange there needs to be trust and in Smith’s conception this comes from morality.
This morality will need to be imposed. Major financial institutions have regressed back to the status quo, as John Lanchester said yesterday “the system is as risky as ever”. They will never voluntarily accept any balances to their earning power. So this will need to come from changed systems of regulation.
But this creates a paradox in that regulation, with its rule based approach, enables a moral vacuum by replacing human judgement with an attitude of “if we stay within the rules we are acting responsibly”. Ironically the FSA (the UK bank regulator) knew this. Over the past few years anyone working in a UK bank will be familiar with the pre-crash mantra of “principle based regulation”. No longer were we to work just within the “rules” but to their spirit. It didn’t work because it stayed at the surface, and people’s behaviour doesn’t change, in many cases the people need to change.
By changing what is valued in banks this will change who progresses within the organisations. This will be a key to unlock a new system. Let’s open up board positions on banks to a wider audience. What’s clear from the past two years is that having a career in banking behind you doesn’t give you any special insight or understanding so let’s have a more diverse group from environmentalists, to community leaders, to customers, having a real voice in the running of financial institutions.
It has been said that markets are amoral. That maybe true but they don’t work unless their participants act morally. Creating moral financial institutions working for commercial gain and the social common good is the challenge.
Please comment below and share using the social bookmark icons. Thanks as ever for reading.
Last year I recommended the best selling book – Exploiting Chaos – by a friend of mine Jeremy Gutsche.
Jeremy’s website Trend Hunter continues to go from strength to strength. His model is fascinating. He has thousands of “trend hunters” posting interesting content about stuff happening all over the world. But what I really love is the way that they are exploiting and developing insight from this content.
The guys have launched a new service called TrendHunter Pro Trend Reports. These are great syntheses of what is hot from all the content posted on Trend Hunter. If you are in consumer insight or want to know about the real cutting edge trends happening now then they are worth looking at. Trend Hunter is great example of how powerful the democratisation of the creation of content is to delivering insight and value.
[Disclosure: If you buy through the above link then I receive a commission on this sale. This does not affect my recommendation of what I think is a good product. If you prefer not to recognise my recommendation through a commission then you can use this link: www.trendhunter.com]
Some of Jeremy’s ideas and thoughts are powerful. He has created a good resource in this book of examples, ideas and provocative challenges that will help to inspire and stimulate thinking.
I’ve always thought that we should hold a high bar to what we regard in business as innovation. During my corporate career I seemed to be constantly working on the next “innovation” as were my colleagues. I think many businesses use the word to make people feel better about the work that they were doing! A new ad, a new twist on an existing product, a new concept in an existing category – most likely they aren’t going to be an innovation.
In my mind innovations need to meet at least the following criteria:
2. It delivers something new against a new or existing need meaningfully and for the long term. I think an innovation should have context – it can’t be a good idea for the sake of a good idea.
The Honda hydrogen fuel cell car, for example, I think will be seen as truly innovative over time because it moves us on significantly into new long-lasting territory. Whereas the Toyota Prius won’t stand the test of time because whilst it was a step forward (and a good one), it didn’t fundamentally deliver against the need meaningfully and for the long term (although the harvesting of electrical energy from braking that Toyota developed is an innovation which I suspect will last).
3. It should significantly challenge the existing status quo. The introduction of an offsetting mortgage, much touted as a financial innovation, didn’t meet my bar – it was a good product and clever but not an innovation. Zopa, on the other hand, a marketplace for you and I to lend to each other safely is an innovation – it challenges the exisiting significantly and is truly novel.
The debate over innovation will go round and round. I just hope that more businesses can deliver value against our needs, whether they call it invention, innovation, or just plain old tweaking.
What do you think? As always please feel free to share, retweet, comment and get involved.