"Change before you have to," said Jack Welsh.
In a Sarbanes-Oxley universe dominated by litigious lawyers, big government, aggressive advocacy groups, and 24-hour investigative media, any corporate reform that can happen will happen. Fast. The only issue is whether it will be forced down our throats or we will anticipate it, embrace it, and profit from it.
In recognition of this, many of the world's smartest companies are changing for the better. Literally. Microsoft voluntarily included parental control technology on its newest video game console. Distiller Brown-Forman is integrating responsibility into every aspect of its business plan. BP, Toyota, and other carbon-dependent companies are turning green. Even gambling giant Harrah's is investing heavily to keep problem gamblers out of its casinos.
However, many corporate leaders with sincere intentions to make their companies more socially responsible find it hard to convert those good intentions into reality. We've worked with many clients embarking on a social responsibility "makeover." Some have succeeded and, unfortunately, many others have failed. It's worth taking a look at the characteristics of both.
A successful CSR program either starts at the top or, at least, enlists the CEO's early and enthusiastic support. These programs must become part of the company's DNA, which only happens when everyone knows the boss wants it to happen. But, wanting it to happen won't make it happen. Leaders intent on "getting right" on CSR look for tangible ways to convey this message throughout the organization, as well as to the public. One effective tactic is to cancel an offending high-profile program. Recently, Anheuser-Busch killed off its highly successful promotion of "beer pong," a popular college drinking game, in just such a move.
Conversely, company leaders often fail in CSR efforts if their commitment is not total or they are unable to convince the organization that it is. This often happens because the responsibility program hits the marketing department like a 185-pound running back hitting a 350-pound nose tackle. No contest. Those within an organization preaching the importance of responsibility can often sound "soft" - "It's the right thing to do, it will pay off in the long run, and it's good for company morale." The response from marketing is "tough" - "Responsibility will cost us money, we'll forfeit market share, and we can beat the bastards in court. In most macho corporate environments, "tough" beats "soft."
That is why successful CSR programs are almost always based on alignment and enlistment. The CEO has to take the lead in aligning the business and the social strategies - showing that it is not a zero-sum game where one agenda comes inevitably at the expense of the other. Then, he or she must enlist the support of the natural enemies of these programs - the marketing and sales departments. If they can be made to see the long-term value in brand enhancement, reputation, and sustainability, the company can move forward, united and committed to responsible leadership.
Greg Schneiders is a founding partner of Prime Group, a consultancy specializing in helping clients understand, plan, and execute change. mailto:Greg@primegroupllc.com