Archive for January, 2011

Move over, CSR. It’s time for New Capitalism

Tuesday, January 25th, 2011

There’s been something new happening around what is called “corporate social responsibility,” a term that emphasized how distant caring about its social impact was from a company’s core mission. The new thinking is this: is it possible to integrate positive social impact (or, at least, much-reduced negative impact) into the very fabric of a profit-making business?

Examples are popping up more frequently. Wal-mart has received attention for its initiatives promoting compact-fluorescent lighting and its recent effort to improve the nutrition of the food it sells.

Already in 2011, two important works have emerged in this area of thought. First, Umair Haque’s book “The New Capitalist Manifesto,” and, in the Jan-Feb Harvard Business Review, “Creating Shared Value,” by Michael Porter and Mark Kramer. Of the two, “Manifesto” is more brightly written and attention-grabbing, while “Shared Value” is solider, with more salient examples.

Haque in particular has a way with a metaphor. For example,

Imagine two worlds: The first is a big world of abundant resources and raw materials, an empty world where demand is infrequent and easily satiated, and a stable world where disasters are infrequent and weak. The second is a tiny world, emptying of raw resources, a crowded world where demand is always hungry, and a fragile world, where contagion of every kind can flow across the globe in a matter of minutes, days, or weeks. A big, empty stable world is like a vast, placid, untouched game reserve.

But a tiny, crowded, and fragile world is like an ark. Industrial-era capitalism was built for a big, empty, stable world.

But at the dawn of the twenty-first century, the world is more like an ark – tiny, fragile, and crowded.

Consuming, borrowing, and utilizing are the engines of prosperity in a big, empty, stable world, but the engines of crisis in a tiny, fragile, and crowded one.

Porter and Kramer traffic in more ground-level thinking, but with the same aim in mind:

The traditional playbook calls for companies to commoditize and exert maximum bargaining power on suppliers to drive down prices – even when purchasing from small businesses or subsistence-level farmers.

[By contrast,] Nestle worked intensively with its [coffee] growers, providing advice on farming practices, guaranteeing bank loans, and helping secure inputs such as plant stock, pesticides and fertilizers. Nestle established local facilities to measure the quality of the coffee at point of purchase, which allowed it to pay a premium for better beans directly to the growers and thus improve their incentives. Greater yield…and higher production quality increased growers’ incomes, and the environmental impact of farms shrank. Meanwhile, Nestle’s reliable supply of good coffee grew significantly. Shared value was created.

This is the key thread connecting “Manifesto” and “Shared Value.” Neither is proposing offsetting bad actions with some related or unrelated good actions. Rather they both advocate creating profits and benefiting the planet through “ark management.” Recognizing and capitalizing on the interdependence of people/resources/governments; regaining a focus on the welfare of the communities in which a company does business; and planning, not just for the next quarter, but decades into the future.

David Brent (”The Office”) on training

Tuesday, January 18th, 2011

Well, after his much-commented-on stint hosting the Golden Globe Awards last Sunday, Ricky Gervais perhaps is not the best role model I could have chosen for today’s post. Yet, let us hearken back to a time when Ricky, in addition to being a “slightly chubby but very kind comedian,” made fun of himself at least as much as the people around him.

I fell in love with the original version of “The Office” years ago. Gervais’ character, David Brent, was all our bad management practices and insecurities in one package, which made for hilarious yet uncomfortable viewing by any manager.

One episode that made me cringe out of self-recognition was “Training.” In this one, David hires a trainer to teach the company about customer service but undermines him by jumping up at every opportunity to (try to) demonstrate that he knows more about customer service than anyone at the company–more, even, than the trainer. While watching this, I had flashbacks to all the times I had jumped up to interrupt a trainer during a class or to demonstrate how much I knew about the subject at hand.

This is a smart-person problem. It was important to me to show I knew a lot. Or, perhaps, a “I think I’m smart but not sure I’m smart enough, so I have to demonstrate my smartness” problem. Or, if you’re David Brent, it’s a “I think I’m brilliant but I’m actually quite dumb,” in which case you have a comedy show.

The lesson I took from this was to see how this behavior looked to others. While I was trying to impress people, they were more interested in learning about the topic at hand. (Some folks probably wished they could have told me to sit down and shut up.) Jumping up to show how much you know is a manifestation of the Hermione Granger syndrome, which I’ll discuss in a future post.

For now, check out David Brent (Ricky) and make sure you don’t do what he does:

Keith Richards – Hall of Fame hard-liver; also collaboration guru?

Thursday, January 13th, 2011

keith richardsI took a hiatus from business books this holiday. They are all starting to read the same to me. For instance, the narrative opening has become a cliche: “Bill Fredericks entered the CEO office for the first time since his surprise promotion and considered how he’d spend his first day in the long-coveted role. The WonderLam PR debacle was entering its third month….” etc. etc.

Anyway, I’m reading a very non-business book: Rolling Stone Keith Richards’ autobiography, “Life.” It’s a great read, as you might imagine. Richards is very candid with his views on his own behavior and that of his compatriots. There’s also amazing in-depth discussion of how to write songs and how to play guitar, Richards-style.

But for the purposes of this blog, Richards’ amazing skill at collaboration stands out. Besides playing with the same core group of musicians for more than 40 years (a collaboration feat that impresses all on its own), Richards also has worked with this list of artists:

Chuck Berry
Aretha Franklin
Gram Parsons
Wayne Shorter
Waddy Wachtel
Phil Spector
Ronnie Spector
George Jones
Jack White
Tom Waits
Muddy Waters
Etta James
Willie Nelson
Don Everly
Sly Dunbar & Robbie Shakespeare

See what I mean?

What did Richards have that made him reach out to so many, and be sought out as well?

Eye on the goal
Richards (at least as he sees it) is totally focused on music. He couldn’t have cared less about the business aspect of the band. From his teenage years, he absorbed records and others’ performances. He thought about music all the time; dreamed it, even.

With this singular focus (let’s put aside the years when music shared his attention with another mistress, heroin), ego and band politics were left aside. About the only conniving Richards admits to involved sneaking a great sax player whom MIck didn’t approve of back on the bandstand.

Being absorbed by music made Richards attractive to others who shared his passion. He might be in the biggest band in the world, but if you had an opinion to offer on, say, Buddy Holly’s singing technique, he would probably have a discussion with you.

Humility and willingness to learn
Richards never seems to feel he masters the guitar. He always has things to learn from others. And when he meets a set of musicians, rather than talk a lot, he seems to spend hours (days, even), playing music with them.

He’s also aware of his limitations. Here he discusses an unexpected call from songwriter Hoagy Carmichael:

He’d heard a version I’d done of the song “The Nearness of You,” which I’d given to our lawyer Peter Parcher. Peter liked my record and the piano playing and he’d sent it to Hoagy. My treatment of it is barrelhouse; it really flips the song on its back, deliberately so. I can’t play piano well and I was improvising to say the least, just sort of making do. And here’s Carmichael on the phone, and he says, “Hey, man, when I heard that version, shit, that’s the way I was hearing it when I was writing it.”… I couldn’t believe it when he rang and said he’d liked the way I’d done it.

And finally to humility, here is Richards’ on the Stones’ initial ambitions: “Our first aim as the Rolling Stones was to be the best rhythm and blues band in London, with regular gigs every week.”

Talent and willingness to teach
Despite his acknowledged limitations, Richards is obviously talented. Soon after he begins absorbing blues music, he is in a band. And soon that band is indeed the “best rhythm and blues band in London.” Then come the songs, and the records, and tours, etc. People wanted to collaborate with Richards because of what he had done. And unlike the comic fearful of getting his jokes stolen, he was happy to share what he knew. Waddy Wachtel writes this in one of “LIfe”’s many sections contributed by Richards collaborators:

I remember when I discovered this weird tuning–as it seemed to me then–that Keith had adopted. In the early ’70’s, I went to England [touring] with Linda Ronstadt. And we was led into Keith’s house in London and there’s this Strat sitting on a stand with five strings on it.And I’m like, “What happened to that thing? What’s wrong with that?” And he goes, “That’s my whole deal….The five-string! The five string open-G tuning.” …Growing up and playing guitar, you’re learning Stones songs to play in bars, but you know something’s wrong, you’re not playing them right…. So when he said that to me, I said, “Is that why I can’t do it right?”

Here’s Richards on collaboration:

After that I decided, fuck it, I want a band…. So I called in guys I’d always wanted to work with, and I knew the man to start with. You could almost say a collaboration had begun between me and [drummer] Steve Jordan even back in Paris during the making of Dirty Work. Steve encouraged me; he heard something in my voice that he thought could make records. If I had a melody I was working on, I’d get him to sing it. And I thrive on collaboration–I need a reaction to think anything I’ve done is any good. So back in New York we started to hang, and we wrote a lot of songs together. Then, with his buddy and collaborator Charley Drayton, mainly a bass player but also another superbly gifted drummer, we started to jam at Woody [Wachtel]’s house.

So if you want to be a better collaborator, rather than look in the business section for advice, you may want to borrow a few pages from a less-likely source, Keef.