Corporate Social Responsibility
Why do we turn to nonprofits, NGOs and governments to solve society’s biggest problems? Michael E. Porter¬†wrote the book on modern competitive strategy for business. Now he is thinking deeply about the intersection between society and corporate interests. While he admits he’s biased, as a business school professor, he has started four not-for-profits, himself. He¬†wants you to hear his case for letting business try to solve massive problems like climate change and access to water.
Why? Because when business solves a problem, it makes a profit — which lets that solution grow.
Can’t view the video? Want to access the interactive transcript? ¬†Click here.
Getting the discussion rolling…
There is much to like in this presentation, and it does a very good job of bridging the terrain that divides social and corporate ventures.
That said, as we reviewed this video, (and in the tradition of¬†Muppet Show hecklers, Statler and Waldorf),¬†Ann and I had a few thoughts:
Would business take on reform of global monetary and financial systems?
Does Porter’s premise that business will resource the solving of¬†society’s biggest problems, out of a profit motive / enlightened self-interest, ¬†scale to all of¬†society’s biggest problems? For instance, why and how would businesses around the world resource a fundamental restructuring of the current global monetary and investment systems?
Many think these systems are fundamentally broken, and at the very least, the systems are reinforcing the wealth divide. So how would that work? Business, by virtue of being able to generate wealth would voluntarily fund a global overhaul of the broken mechanisms of wealth creation and distribution, in cooperation with the worlds’ governments? The same mechanisms that capitalize business growth and fund governments, through taxation? The same governments who rarely agree about matters relating to the global commons – atmosphere, oceans, global warming, nuclear proliferation, etc.?
(I’m picturing the world described in Neal Stephenson’s intense and dark science fiction novel, Snow Crash, in which governments had¬†ceded most of their power to private corporations, organizations, and entrepreneurs operating as nation-states. brrr!)
Will public companies be allowed to move to a longer view of profitability?
On the bright side, Porter gives examples of businesses that are taking a longer view of profitability:
‚ÄúThe deeper work, the new work, the new thinking on the interface between business and social problems is actually showing that there’s a fundamental, deep synergy, particularly if you’re not thinking in the very short run. In the very short run, you can sometimes fool yourself into thinking that there’s fundamentally opposing goals, but in the long run, ultimately, we’re learning in field after field that this is simply not true.‚ÄĚ
Glad to hear it, because the last couple of public multinational corporations we worked with had a VERY difficult time making socially-conscious, longer-term investments. The pressure to meet quarterly projections coming from Wall Street, alone, was devastating, forcing them to give up their long-term aspirations or be punished in the short-term as their stock prices fell. It is ironic that the multinational companies that could do the most good may be least able within the existing system.
What do you think?
Ann and I would be fascinated to hear your thoughts on Porter’s video. If you feel moved to contribute to our community’s discussion, we welcome your input on the commentary thread, below.
Thanks for watching!
- Ann and Gary Ralston
¬© 2014 Ralston Consulting Inc.
MOOCs are opening more than higher education to the world – they can open the world to you
This fall I participated in my first MOOC (Massive Open Online Course – see sidebar). The course, Behavioural Economics in Action 101x, is offered by the prestigious Rotman School of Management at the University of Toronto, for free. I’m accessing this course through EdX, a¬†non-profit online initiative of 30 of the world’s top universities,¬†created by founding partners Harvard and MIT.¬†Their mission is expand access to the best of higher education for students around the world – and this in part means reducing or eliminating the barrier of cost.
If my class is any indication, EdX has proven its global reach. I was blown away – each pin on the world map below represents one of my over 2100 fellow learners!
Now it’s great that EdX is bringing this course to the world. Absolutely. But early into the course it dawned on me that through this MOOC, EdX had brought the world to me! While I found the course content interesting, I was much more intrigued by the varied points of view from different cultures.
A bit about the course content
What was your BIGGEST class at university?MOOCs are bigger…
A¬†MOOC¬†is a Massive Open Online Course – a relatively new development in the world of online learning that is generating significant buzz, and no small amount of angst about their possible impact on the business model for higher education.
Top universities are offering top-notch¬†interactive¬†courses to¬†large¬†numbers of students at once, taught by excellent faculty, many¬†for free,¬†and some¬†for-credit, at a fraction of the cost¬†of a conventional university course.
In case you are wondering how many students per class is¬†large…¬†according to Wikipedia,¬†‘Udacity’s CS101, with an enrollment of over¬†300,000 students, was¬†the largest MOOC to date.’
Behavioral economics explores, from a psychological point of view, why people sometimes make irrational decisions, and why and how their behavior does not follow the predictions of economic models. Further, these behavioral insights can be used to influence decisions in many ways, from the obvious – drive up consumer spending by offering “bargains” – to the more subtle – lose weight by doing nothing more than taking a picture of everything you consume. Such techniques or strategies, designed to subtly influence decisions toward a given outcome, are commonly referred to as¬†“Nudges”, and there has been much interest in applying such behavioral insights to larger policy and societal issues.
Many of our class discussions (held in web-based discussion forums) focused on social issues, with the intention to explore how to influence or “nudge” behaviors that increase health and overall well-being of people and societies.
Some of our early topics…
- disrupting the transmission of AIDS in Uganda,
- quelling noise pollution from overuse of car horns in large cities in India, and
- shifting a nation’s personal debt and spending / saving patterns.
And the conversations were fascinating! The richness and diversity of views and the insights from different countries, socio-economic backgrounds and fields of study opened a much wider world to me, creating a deeper and more engaging learning experience. There is nothing like discussing a subject with someone from a foreign culture and way of thinking to show up your own assumptions and biases!
If you’ve been missing out on the amazing variety of free, quality education available through MOOCs, and a world of fellow learners, here are a few tips (okay, nudges!) to get you started:
- Get the goods:¬†For quality courses, stick with the big three in the MOOC-iverse ‚Äď ¬†Coursera,¬†Udacity¬†and¬†edX¬†‚Äď at least to begin with.
- Get inspired: How to pick the best MOOCs: six tips from a Coursera junkie
- Get ready:¬†Picking and Planning Your First MOOC: Getting Started
See you in the MOOC-iverse!
- Ann Ralston
¬© 2013 Ralston Consulting Inc.
What do we really know about human behavior and motivation, worldwide?
Sustainable business models and social enterprise models count on our ability to understand why our customers buy and use our products and services. Our most successful clients have developed an uncanny sixth sense ability to know the customer’s motivations better than the customer.
On their home turf.
“Home turf”, for many of our clients, means¬†WEIRD countries. Now before anyone takes offense -¬†WEIRD stands for¬†Western,¬†Educated,¬†Industrialized,¬†Rich, and¬†Democratic. As long as they grow their ventures into other WEIRD markets, that sixth sense about customer motivation can serve them. But go beyond, and it’s a different story (to which our clients with global reach can attest).
Why is this so?¬†¬†Why do some of our instincts about customer motives in foreign markets turn out to be wrong – and sometimes¬†waaay¬†wrong??
“We Aren’t the World” is a brilliant article / interview about three researchers at University of British Columbia who, according to author, Ethan Watters, “are shaking the foundations of psychology and economics‚ÄĒand hoping to change the way social scientists think about human behavior and culture.”
Their work has taken them around the world, testing how¬†perceptions, behaviors, and motivations vary by culture. Along the way, they discovered significant biases in the research methods of “…a¬†vast amount of scholarly literature in the social sciences‚ÄĒparticularly in economics and psychology…”
“As the three continued their work, they noticed something else that was remarkable: again and again one group of people appeared to be particularly unusual when compared to other populations‚ÄĒwith perceptions, behaviors, and motivations that were almost always sliding down one end of the human bell curve.
In the end they titled their paper ‚ÄúThe Weirdest People in the World‚ÄĚ (pdf) By ‚Äúweird‚ÄĚ they meant both unusual and Western, Educated, Industrialized, Rich, and Democratic. It is not just our Western habits and cultural preferences that are different from the rest of the world, it appears. The very way we think about ourselves and others‚ÄĒand even the way we perceive reality‚ÄĒmakes us distinct from other humans on the planet, not to mention from the vast majority of our ancestors. Among Westerners, the data showed that Americans were often the most unusual, leading the researchers to conclude that ‚ÄúAmerican participants are exceptional even within the unusual population of Westerners‚ÄĒoutliers among outliers.‚ÄĚ
Given the data, they concluded that social scientists could not possibly have picked a worse population from which to draw broad generalizations. Researchers had been doing the equivalent of studying penguins while believing that they were learning insights applicable to all birds.”
How could this happen?? (Did you guess: ‘European colonialism and political correctness’?)
“The last generation or two of undergraduates have largely been taught by a cohort of social scientists busily doing penance for the racism and Eurocentrism of their predecessors… “
I cannot overestimate the importance of developing acute cultural sensitivity when going into regions affected by European colonial expansion, which began in the 15th century and whose impact is felt to this day.
Also, don’t assume you have to cross oceans to find such cultures. I owe a debt of gratitude to my aboriginal clients and friends – members of Coastal First Nations in British Columbia. They helped me through one of the most powerful, disturbing experiences of my career as I learned about the terrible history of abuse of aboriginals in residential schools in Canada.¬†For more information, please visit¬†Canada’s¬†Truth and Reconciliation Commission¬†site.
For any colleagues heading into similar territory, the site above, as well as the book:¬†Decolonizing Methodologies: Research and Indigenous Peoples¬†may help heighten your cultural sensitivity.
“To avoid stereotyping, it is rarely stated bluntly just exactly what those culturally derived qualities might be…¬†Economists and psychologists, for their part, did an end run around the issue with the convenient assumption that their job was to study the human mind stripped of culture. The human brain is genetically comparable around the globe, it was agreed, so human hardwiring for much behavior, perception, and cognition should be similarly universal. No need, in that case, to look beyond the convenient population of undergraduates for test subjects. A 2008 survey of the top six psychology journals dramatically shows how common that assumption was: more than 96 percent of the subjects tested in psychological studies from 2003 to 2007 were Westerners‚ÄĒwith nearly 70 percent from the United States alone. Put another way: 96 percent of human subjects in these studies came from countries that represent only 12 percent of the world‚Äôs population.”
But it gets worse. From the research paper:
“Even within the West, however, the typical sampling method for psychological studies is far from representative. In the Journal of Personality and Social Psychology, the premier journal in social psychology‚ÄĒthe sub‚Äźdiscipline of psychology that should (arguably) be the most attentive to questions about the subjects‚Äô backgrounds‚ÄĒ67% of the American samples (and 80% of the samples from other countries) were composed solely of undergraduates in psychology courses (Arnett 2008). …”
No. Way. Epic experiment design assumption goes¬†horribly wrong and throws a shadow over an entire field of study. Oh – and anything else that is based on the field in question.
The magazine article concludes:
“And here is the rub: the culturally shaped analytic/individualistic mind-sets may partly explain why Western researchers have so dramatically failed to take into account the interplay between culture and cognition. In the end, the goal of boiling down human psychology to hardwiring is not surprising given the type of mind that has been designing the studies. Taking an object (in this case the human mind) out of its context is, after all, what distinguishes the analytic reasoning style prevalent in the West. Similarly, we may have underestimated the impact of culture because the very ideas of being subject to the will of larger historical currents and of unconsciously mimicking the cognition of those around us challenges our Western conception of the self as independent and self-determined. The historical missteps of Western researchers, in other words, have been the predictable consequences of the WEIRD mind doing the thinking.”
So take heed – if your organization has plans to operate in a foreign cultural context and marketplace:
- Read the article, research paper, and anything credible you can find about the culture.
- Find local cultural guides and take a learning journey, immersive¬†far beyond the ‘airport hotel and tour bus’ visit. The aim is to¬†experience firsthand¬†the nation, the people and their culture – down to the specifics of¬†where and how they will buy and use your offering. (Be prepared to put aside anything you’ve read in favor of direct experience.)
- Given all you have learned, localize your business model, offering and approach.
Maybe then, the locals won’t dismiss you as too¬†WEIRD.
A shout out to Fleurette Sweeny at SelfDesign Learning Foundation for turning us on to this article!
- Gary Ralston
¬© 2013 Ralston Consulting Inc.
In Part 1, after watching a TEDTalk video featuring Simon Sinek, Ann and I decided to re-write the way we tell the story of Ralston Consulting Inc. following the approach in the presentation.
Sinek observes that everyone in an organization knows What they do, some know How they do it, and yet fewer know Why they do what they do. His insight is that great companies, and great leaders reverse the order of the message: Why, then How, and then What. Sinek maintains: “People don‚Äôt buy what you do; people buy why you do it.”
We decided to test it out with you. Here’s a draft of our new message:
We believe the world urgently needs leaders of heart, of conscience and of long vision, who today undertake enterprise that also benefits our children’s children. It is these leaders we are interested in walking with.
We do so as partners in thought and action, co-inventing sustainable and generative ways forward where convention doesn’t cut it, the past has failed the future, and the alternatives are unclear.
We offer leading-edge tools and ideas for strategic foresight and business innovation, for lean startup and sustainable growth, for creating communities of change, and for developing our next generations of leadership.
Walk with us and tell us what you envision. Let’s create a better way forward…
What do you think and feel about it? We’d love to hear from you, and we want it all. We need the straight goods if we are to make it better.
If you’re moved to share your thoughts, either post a comment here, or email us.
Thanks very much!
Ann and Gary
Here’s a systems-thinking puzzle: If you wanted to improve the global economy, slow population growth, reduce HIV-related deaths, break dependency on international aid shipments, and encourage peace, could you accomplish all that in one focused move?
Watch The Girl Effect:
Check out the widespread, high-profile response:
Now visit girleffect.org and see how you might help…
Our thanks to colleague, Charles Holmes, for bringing this vital campaign to our attention!
It’s a hot summer Saturday in the middle of June. ¬†Most kids are on summer vacation, but today, 200 students from around Ohio are in a school gym, competing in the CORI Connect a Million Minds 2010 Robotics Invitational, sponsored by Time Warner Cable. ¬†It’s about robots PLAYING SOCCER and high school students created the robots!
Why are these students so engaged? Why are so many volunteers and sponsors across the nation, from education, business and communities, so deeply involved in FIRST robotics programs for students? What is the Central Ohio Robotics Initiative (CORI), and why is Ralston Consulting, in collaboration with others, so active in bringing CORI to life?
This type of event, one that captures the hearts, minds and excitement of the students, is the FUTURE. It is the future of how students learn, interlacing theory with hands-on innovation, mentorship and collaboration with competition, and technology with human character, ethics and spirit. ¬†It is having a real-world impact increasing the likelihood that high school students will choose careers in Science, Technology, Engineering and Mathematics-related fields (STEM), so critical to the future of our economy.
It is also the future of how workers will collaborate, and the future of how businesses will be managed. In a recent Wall Street Journal article titled: The End of Management, author Alan Murray underscores the crises organizations face as a result of the ineffective bureaucracies contributing to today’s corporate inertia. Organizations and their managers are not agile enough to deal with today’s rate of change. ¬†It is, in point of fact, easier and more comfortable to not change.
Mr. Murray lists attributes of the ‘new science of management’:
- mass collaboration;
- a marketplace mentality of resource procurement and allocation; and
- “structures that drive innovation, creativity and a spirit more akin to an entrepreneur.”
If this is the future of management, it is here, now, in the FIRST Robotics Competitions.
Rewind to the start of each year’s robotics competition: It’s 9:00am on a Saturday morning in early January, and bleary-eyed students come alive as they participate in a nationwide simulcast unveiling the game for the year. Dean Kamen, inventor of the Segway and the first insulin pump, and the mastermind behind FIRST (For Inspiration and Recognition of Science and Technology), shares the closely guarded game and specifications bounding each year’s competition. (3D game animation from 2010 on the NASA site,¬†here)
Over the next 6 weeks, the students voluntarily work after school and on weekends to design and build these robots for regional competitions. ¬†The limited design/build window demands rapid prototyping, rapid decision-making, and levels-up students’ critical thinking skills. ¬†Failures are part of the design process, and students master the ability to evaluate, learn adjust their designs, as they build, test, and rebuild their robots.
What drives these kids? They see it as fun – fun AND relevant. They create deep friendships with their teammates and mentors. They get to try on a career before going to college. They believe they have an advantage over their peers in the classroom, being more experienced in critical thinking skills and in the creative process as an outcome of their experience. Many of the students refocus their orientation toward school in order to master knowledge needed for their team to create a competitive robot.
The students apply their limited resources across the project, breaking down the robot into different elements, coming together to integrate work and breaking back up to small groups to accomplish additional tasks of presentations, video and web production, marketing and fundraising. Students with the most experience or knowledge mentor new/younger students, first, to get the job done, and second, to make sure that the next years team will have the talent pool adequate for future success.
In addition to their peers, student teams are matched with mentors (often college-age engineering students, and many, themselves, former FIRST team members) and advisors, who serve as facilitators, thinking partners and role models.
By design, Mr. Kamen intertwined collaboration as a fundamental value throughout the culture of FIRST. ¬†Competition is structured with alliances of 3 teams, competing against another 3 team alliances. The alliances change every round. ¬†Your determined competitor this round will likely be a vital ally in a future round. This fosters a spirit of Gracious Professionalism‚ĄĘ – “a way of doing things that encourages high-quality work, emphasizes the value of others, and respects individuals and the community.” Gracious professionalism can be seen as experienced teams support rookie teams, or as equipment and parts are shared with ‘opponents’ to bring the level of competition up for all. The grace and professionalism exhibited by these student competitors could serve as an ethical model for many of today’s business leaders.
Newly founded, the Central Ohio Robotics Initiative (CORI) amplifies FIRST’s national structure and intent by developing a regional (and therefore, more affordable) competitive robotics event for Central Ohio.¬†The group is a collaborative of parents, students, business owners, professors and teachers who have come together to help launch new teams, recruit advisors, and host these events for the betterment of the students and of the region.
What can¬†business – your business – learn from these students?
- Get over failure. It’s part of learning what works and what doesn’t.
- Use rapid prototyping to accelerate learning and innovation.
- Intentionally pair new people (or people new to their role) with mentors holding the needed content expertise.
- Structure for collaboration.
- Plan your firm’s capacity-building in the short-term in a way that positions it for long-term success. FIRST teams have a simultaneous focus on success both this year and next year, driving the teachers, mentors and experienced students to bring along the newer, less experienced / knowledgeable team members to prepare them for the following season.
- Be conscious of the impact of culture on your initiative. In FIRST, students increase mastery in Science, Technology, Engineering and Mathematics in part because an environment has been created where geek – to be freaking smart – is cool. What would make your initiative the ‘cool’ place to be?
It’s not just the future, it’s our future. These students are the future of our country. I have great faith that these students will master the science and technology needed for their careers, but they will also be wonderful managers, leaders and innovators. Ralston Consulting is delighted to be a part of creating CORI, and welcomes all new teams, mentors and sponsors gearing up for the 2011 FIRST season!
(c) 2010 Ralston Consulting Inc.
About the Author: Ann is president of Ralston Consulting Inc. and a founding member of the Central Ohio Robotics Initiative.