Business as usual no longer applies anymore. In case you haven’t noticed every market segment of our economy is in a state of flux. While many rally around any good news out of Wall Street the results are short term reactions with little basis as sustainable. Long term the fiber of the old economic system has shifted and isn’t likely to return.
Doing more with less is now the common management mantra but it goes way beyond that old model of cutting expenses and producing more. The entire “system of capitalism”, its old business models and thinking, has moved away from “mass production supported by mass consumption” to value production supported by social consumption. This shift changes every business assumption on the planet.
Value consumption is driven by relationships and production is fueled by a new kind of social responsibility.
The very term of social responsibility represents a seismic shift in consumer behavior influenced primarily by conversations. Any business that is not in tune with these shifts is living on borrowed time and in denial. This shift is not going away rather its speed is increasing.
Is Your Business Useless?
Omair Hague from Harvard writes: Is Your Business Useless? These days, lots of people ask me: “Phew! So, the crisis is over, right?” Wrong.
The real crisis is in the DNA of the industrial economy — and it’s just as lethal as ever. Most businesses are socially useless. They’re about as useful to society (to paraphrase Gloria Steinem) as bicycles are to fish.
Sound controversial? If it does, it only underscores just how out totally of touch with real value we’ve gotten. (Here, for example, are Paul Krugman, Simon Johnson, and Lord Turner all discussing social uselessness.)
What has socially useless business cost just over the last five years? $12 trillion at a minimum. Those are the costs of the various bailout packages for socially useless banks.
Socially useless business is what has created a global economy on life support. Socially useless business is what has created a jobless “recovery” and mass unemployment amongst the young. Socially useless business is why we don’t have a better education, healthcare, finance, energy, transportation, or media industry. Socially useless business is a culture in shock, reeling from assault after assault on the fabric of community and comity. Socially useless business is the status quo — and the status quo says: “You don’t matter. Our bottom line is the only thing that matters.”
Until now. Today, socially useless businesses are living on borrowed time — and the clock’s about to reach zero hour. Somewhere out there is a Constructive Capitalist who’s going to use the power of meaningful economics to relegate you to the dustbin of economic history — just like Google and Apple are doing to big media, Wal-Mart’s doing to big food, FMCG, and retail, and Nike’s doing to shoes.
Constructive Capitalists are better businesses. They’ve learned how to create thick value: value that’s socially useful. They are doing things that matter to people, communities, and society.
So there’s a single, simple, fundamental question every decision-maker should be asking today. How useless is your business?
To answer it, you’ve got to stop thinking in yesterday’s terms. Forget the decades-long obsession with business models for a second. It’s time to think anti-business models. Anti-business models are models companies use to profit without doing anything socially useful.
What Is Socially Useful?
Social usefulness are those activities which matter to people. Regardless of your business the critical question to become a socially useful business is to ask “What really matters?“. If you think through this question you will find what matters is centric to improving relationships. Your relationship with the market, your employees, suppliers, shareholders and society can be enhanced by adding more value. However, value has shifted from the output, results, to the input side of your system. The input side of your business starts with your thinking and how you manage and produce everything.
How useful is your business? The crowds and the conversations will decide.