The Value of Role Models in the Downturn- a hbr article i wanted to share with all
The Value of Role Models in the Downturn
8:56 AM Monday March 2, 2009
It's hard to find many bright spots in the increasingly gloomy economy, but they're out there.
Among big companies, IBM and Procter & Gamble are bright spots. IBM's earnings have beaten forecasts; P&G has a robust business and has already integrated its huge Gillette acquisition relatively seamlessly. Why are these and select other companies faring OK today? Because they made important changes well before the recession hit full force. This includes, for these two companies, a re-emphasis on values and ethics. This downturn's survivors will be the role models for a new kind of business practice that is more socially responsible not as an add-on or after-thought but as a first thought at the core of its business operations.
That's a good thing, because numerous revelations of misdeeds - from Bernard Madoff to Indian software entrepreneurs - always turn up when conditions turn down. That's one reason that confidence in business executives is hitting bottom. Having positive role models among giants that buy from numerous small company suppliers can reverberate through the economy to provide some hope, especially if their practices are emulated.
Seeking role models - not just benchmarks - is one way to find an upside in the downturn. It's counterintuitive, because downward spirals or losing streaks tend to push people and companies to withdraw and become insular - like individual depression that might cause people to stay in bed rather than face the world. With a little extra time, or as a pause between bouts of hard work, we can look at positive models, current or historical, to find inspiration. Book club organizers, now's your chance.
A time of cynicism and mistrust can be made brighter by focusing on heroes. And because every story of success is also a story about persistence despite obstacles, the lessons can be applied to one's own situation, as a source of inspiration and practical tips.
One of the things that my own heroes, both top leaders and individuals, have in common is their feeling of obligation to leave a positive mark on the world. They do not stop feeling it just because the going suddenly got tough. This stimulates their creativity, produces innovations that turn out to be valuable in downturns, and motivates effort, no matter what. Their work matters.
I think about how Nelson Mandela survived 27 years in prison before emerging to become South Africa's first democratically elected president. He never forgot that he was the leader of a movement, and that others depended on him. He managed to run a training camp while imprisoned for other dissidents who passed through on shorter confinements.
Another hero is Michael Brown, CEO of City Year, who founded that great non-profit with Alan Khazei. City Year mobilizes 17-24 year-olds for a year of full-time national service, primarily in disadvantaged public schools, like an urban Peace Corps. City Year's focus on reducing school dropout rates not only infuses the organization with a mission even larger than recruiting youth to serve, but it also is attracting scarce public sector support at a time of cutbacks. Better yet, a partnership with TIME magazine earned TIME managing editor Rick Stengel an executive-of-the-year award along with Brown and Khazei for championing national service, which gives people in the TIME wing of the troubled mainstream media industry a feeling that their efforts to help the magazine survive are important not just to shareholders but to America.
That brings me back to IBM and P&G. In both companies, the sense of social mission that accompanies the business mission keeps people focused on the importance of their work to solving societal problems. The resulting innovations help the companies in tough as well as easy times. In Brazil, P&G's focus on meeting the needs of lower-income consumers - the fastest-growing part of the economy - helped innovators develop a series of high-quality but lower-priced products, stripped to their essential best features, which were responsible for dramatic increases in market share and profitability before the recession. They became global models for poor countries. Now, during this recession, products like these can help the company continue to reach consumers even in mature markets who can no longer afford premium-priced diapers or laundry detergent.Sure, P&G is a business, and so are IBM and TimeWarner. But the way they emphasize their social mission that gets real work done can help build the foundations for a stronger economy. That's an uplifting upside to carry us through this terrible downturn
8:56 AM Monday March 2, 2009
It's hard to find many bright spots in the increasingly gloomy economy, but they're out there.
Among big companies, IBM and Procter & Gamble are bright spots. IBM's earnings have beaten forecasts; P&G has a robust business and has already integrated its huge Gillette acquisition relatively seamlessly. Why are these and select other companies faring OK today? Because they made important changes well before the recession hit full force. This includes, for these two companies, a re-emphasis on values and ethics. This downturn's survivors will be the role models for a new kind of business practice that is more socially responsible not as an add-on or after-thought but as a first thought at the core of its business operations.
That's a good thing, because numerous revelations of misdeeds - from Bernard Madoff to Indian software entrepreneurs - always turn up when conditions turn down. That's one reason that confidence in business executives is hitting bottom. Having positive role models among giants that buy from numerous small company suppliers can reverberate through the economy to provide some hope, especially if their practices are emulated.
Seeking role models - not just benchmarks - is one way to find an upside in the downturn. It's counterintuitive, because downward spirals or losing streaks tend to push people and companies to withdraw and become insular - like individual depression that might cause people to stay in bed rather than face the world. With a little extra time, or as a pause between bouts of hard work, we can look at positive models, current or historical, to find inspiration. Book club organizers, now's your chance.
A time of cynicism and mistrust can be made brighter by focusing on heroes. And because every story of success is also a story about persistence despite obstacles, the lessons can be applied to one's own situation, as a source of inspiration and practical tips.
One of the things that my own heroes, both top leaders and individuals, have in common is their feeling of obligation to leave a positive mark on the world. They do not stop feeling it just because the going suddenly got tough. This stimulates their creativity, produces innovations that turn out to be valuable in downturns, and motivates effort, no matter what. Their work matters.
I think about how Nelson Mandela survived 27 years in prison before emerging to become South Africa's first democratically elected president. He never forgot that he was the leader of a movement, and that others depended on him. He managed to run a training camp while imprisoned for other dissidents who passed through on shorter confinements.
Another hero is Michael Brown, CEO of City Year, who founded that great non-profit with Alan Khazei. City Year mobilizes 17-24 year-olds for a year of full-time national service, primarily in disadvantaged public schools, like an urban Peace Corps. City Year's focus on reducing school dropout rates not only infuses the organization with a mission even larger than recruiting youth to serve, but it also is attracting scarce public sector support at a time of cutbacks. Better yet, a partnership with TIME magazine earned TIME managing editor Rick Stengel an executive-of-the-year award along with Brown and Khazei for championing national service, which gives people in the TIME wing of the troubled mainstream media industry a feeling that their efforts to help the magazine survive are important not just to shareholders but to America.
That brings me back to IBM and P&G. In both companies, the sense of social mission that accompanies the business mission keeps people focused on the importance of their work to solving societal problems. The resulting innovations help the companies in tough as well as easy times. In Brazil, P&G's focus on meeting the needs of lower-income consumers - the fastest-growing part of the economy - helped innovators develop a series of high-quality but lower-priced products, stripped to their essential best features, which were responsible for dramatic increases in market share and profitability before the recession. They became global models for poor countries. Now, during this recession, products like these can help the company continue to reach consumers even in mature markets who can no longer afford premium-priced diapers or laundry detergent.Sure, P&G is a business, and so are IBM and TimeWarner. But the way they emphasize their social mission that gets real work done can help build the foundations for a stronger economy. That's an uplifting upside to carry us through this terrible downturn
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thanks for sharing this GDB