CSR and True Devotion…

Here is a tough question: Is it really possible for a firm to show real devotion to a cause or social initiative? I mean real and authentic interest. Do you believe that this can be the case? Most of the companies that have implemented a CSR program claim that they are truly interested in solving or contributing to a social problem. They do not cite as their main reason for a CSR campaign the branding and marketing benefits that by all means seek. I personally believe that almost all the companies that are involved in a corporate social responsibility initiative and cause have as their prime goal branding and marketing benefits. However, in this pursuit for differentiation and advantage they can make a truly great impact in the society. I also hold the opinion that there might be a very small percentage of corporations that are devoted to a cause because of the cause itself and not for all the potential (marketing and branding) benefits that they may reap.

Social Causes

One great use of social media and user generated content of any form (text, audio and especially video) is to support a cause and a social initiative. Corporations in particular can utilize that form of communication to publicize and enhance awareness of the cause and their contributions as well. Corporate social initiatives and corporate social responsibility are current trends that have great impact in brand reputation and equity. I believe that businesses will realize the potential benefits that social media could add to their CSR campaigns and start utilizing these as strategic tools.

An example of my previous statement can clarify what I mean. Suppose you are a business that starts a new social initiative, for example a race against deforestation. You can host videos and other forms of content (such as photos, text comments, etc.) of local people and your employees planting trees. On each event you plan and host you can add valuable content of that kind to inspire more people to join your efforts, to show that while doing these activities you can have fun and to show that you support and embrace your community and its members. These videos or media of any kind you choose to implement can also have a great educational value.

Business Strategy Evolution

Last year I had written a series of posts about the possible evolution of business strategy. A great blogger I know, Dmitry Linkov, was writing his post-graduate assignment on this topic and these were some of my thoughts about the subject (you can find my thoughts here, here and here). Anyway, thinking of my ideas about business strategy evolution it seems that I have not included what these days seems so obvious: social media. Social media are and will definitely be included in the short and medium-term focus of business strategy and innovational – creative thinking. In fact, I foresee social media as key elements that corporations and organizations will implement as core competencies and they will take advantage of their users’ generated content as business strengths.

Business Strategy Evolution: Part C

This is the third part of some thoughts about how business strategy will evolve in the future. Have a look below to see the previous part too. These were my thoughts at this time. Should I have more thoughts about this topic at a later time, I will post it.



Information Overflow

Businesses were always striving for more information to enable them decision-making and more accurate predictions. That led to advanced information systems, technological advancements, IT departments stuffed by experts, ERP, CRM and other software to handle all that information. That information race however led to information overflow. Moreover web 2.0 made information available to all consumers and facilitated its exchange and sharing thus resulting in companies having to manage that overflow both internally and externally. Nowadays companies will have to adopt sophisticated systems to easily and effectively manage information flow into the corporation, out of the corporation and furthermore track and take (some) control of the relevant information that exists out there. Imagine a dissatisfied blogger posting his/her grievances on his/her blog and even worse commenting on thousands of other about your bad customer service or product. How a company can track that information and find ways to answer back or apologize for a bad incidence?


Further Segmentation of Markets

Another characteristic of modern markets is its variety and diversity of products. A single need can now be satisfied with hundreds if not thousands of similar products. Companies have developed targeting and niche markets in order to succeed and survive in the long-term. However competition is now starting to even strike niche markets and highly targeted consumers have plenty of alternatives options. In the not to far future, businesses of all sizes will have to segment the market they deliver to, even more. They will have to develop more niches, target at even tighter groups and aim at keeping their clients loyal and satisfied. It will not be easy anymore to substitute a dissatisfied customer with a new one, so customer service and loyalty programs are number one success factors. Thus for business to find their niches, they will have to strive more: it will be difficult to track them, advertise at them and convert them to customers and later on to advocates (very loyal customers, free and quality advertisers). Businesses will have to offer a lot more to get far less that they used to. Common advertising will be highly ineffective of course.

Business Strategy Evolution: Part B

Ok, this is the second part of the evolution of business strategy. I have some thoughts but unfortunately very few spare time to write them down and post them here... This is the second part which is very short but I am already working on the third (and maybe last) part.


The Beta Products

Harsh competition forced many companies to speed the process of product development and resulted in a model where customers are also testers of the early stages of products. Beta versions are very popular and common on the internet. Furthermore beta versions apply more to services and tangible products rather than regular products (I can’t imagine Beta toothpaste!). Two are the key points when discussing the beta products: Firstly, betas mean less testing for the company thus lower investments. Lower investments lead to lower risks associated with product failure. So, we come to the second point: The collaborative model where business and customer cooperate for the interest of both (company for increased profits, customer for better experience). In that model, customers constantly give valued feedback to the company and in a way they actively participate in the product development.
So in brief, Beta products help companies be ahead of competition and lower the risk of product failure, which in normal occasions is very high (the majority of products fail either in development or at their launch).


The Experience Approach

Businesses are trying a different approach in delivering products; a holistic approach. From the core product, we have advanced to an escorting set of services as a point of differentiation. From now on, companies are starting to transform products’ & services’ consuming to “Experiences”. That is a new emerging approach that is unexploited yet. Experience means more integration of services, more customer satisfaction and a strong focus on loyalty and value for customer.

The Evolution of Business Strategy: Part A

I saw a post in one of the blogs I read (The Messaging Times) about the evolution of Strategic Management and Business Strategy. See the post here: http://www.messagingtimes.com/blog/?p=218. Dmitry Linkov (http://www.dmitrylinkov.com/) is writing his Master Diploma work and he can use some help and thoughts about the evolution of business strategy and management.

Below I post some of my thoughts about the subject… this is the first part:



SME Shelter

The internet is the last frontier for small and medium sized businesses in order to compete with the contemporary giants. I foresee two possible scenarios:

• Web 2.0 and modern internet trends will shelter small and medium sized businesses and will become the strategic center where these businesses will answer back and proactively claim customers’ attention and preference. That will happen through management of change, customer careful listening / trend watching and finally through advanced specialization, know-how, intensive and innovative ways to compete.

• Big corporations and multinationals will fast and easily respond to the latest trends such as blogging, internet affiliating and referring, infolust, etc. They will carefully adapt those latest developments and moreover they would be available to evolve those concepts to even more innovative projects and wealth channels for them.

It is highly likely that those two scenarios will both occur having several markets which are vastly segmented and others highly concentrated.


The Referring Economy

Another trend that will gain much popularity and importance is the “Referring Economy”. Referring Economy is the system in which each individual will have great referring power and he/she will be in position to make really great impact in economy and markets. This goes further than the average affiliate selling program; each of us will have a great amount of information and choices thus enabling us to refer others to use the services and consume the products either we know and trust or we have a vested interest at them. Viral marketing and word-of-mouth will be the case in the first occasion and affiliating / referring the later.

Kinds of Corporate Social Initiatives and major problems-challenges when designing a Corporate Social Responsibility Program

Those involved with the development of corporate social responsibility initiatives always face the problem of which kind of corporate programs about social responsibility to adopt. This is indeed a great challenge for a marketer and may lead to an unprecedented success or a complete disaster! Hence there is great need for a careful plan to be designed and be successfully integrated. Although there are several categories that social initiatives fall in, it is preferable for a company to choose one or more categories rather to implement many different programs which will likely cause little cooperation and may confuse the customers. A full descriptive study about different types of CSR initiatives is included in Kotler’s and Lee’s book: Corporate Social Responsibility. The writers group the most common CSR programs (those which fall into the corporate social responsibility concept umbrella) in 6 categories: cause promotion, cause related marketing, corporate social marketing, corporate philanthropy, social responsibility practices and employee volunteering. Also note that this categorization is not the only one. For example many companies choose to categorize programs in group of similar activities such as environmental activities etc. Or other companies implement social responsibility programs categorized according to the respective stakeholder. For each CSR category there are specific steps in creating the plan of action. Many of these steps are similar for different categories or even exactly the same.

The second more important decision, beyond what social issue should one get tied with, is if one should include partners (both for-profit or not-for-profit) and if so, what partners and what kind of partnership to tie? Partnerships can play a very important role in a CSR’s program success. Strong Partners can wield great influence upon pressure groups and consumers and thus they can reinforce the company’s brand name and add value for the firm. Moreover partners can link the company with several stakeholders, they can add validity and reliability to a CSR initiative and provide with the necessary know-how.

Corporate Social Responsibility # 2: Business Ethics

Continuing the article about CSR (corporate social responsibility), I would like to discuss about the ethical part of businesses and the part ethics play both in the performance of a company and in the planning of a CSR program.

Ethical questions arise very often in the business world not only in strategic level but also in everyday decisions about normal and usual activities of the company. Managers should follow the guidelines and the main principals of the company in order to resolve ethical problems and answer to difficult questions. Under the context of CSR and Business Ethics a manager should always seek to find the moral answer to his questions and decide to act good to the environment and the society in general. Reasons to support the context of CSR have been discussed in an older post below. Consequently, managers when deciding which option to choose, the first which cause harm or the second which has a positive impact on society, should choose the latter.

Real problems arise when both choices are ethically right and good!!! On occasions like this –which are not very rare – managers face great dilemmas as to which option to choose and which good practice should sacrifice in order to provide greater welfare to individuals and society. A good idea then is to consult the main principles of the company or organization in which he/she works and find which option is evaluated as more important and higher in the main objectives list. One can ask guidance from his/her supervisors, from code of ethics of one’s company or relevant manuals, etc. However there are some dilemmas which are not being addressed by the code of ethics of the company (or organization) or are ambiguous. In those occasions things are even harder for managers to decide. The real interest and an integrated education and deployment of ethics in the organization in which ethical questions have not been addressed can provide the ground for the solution of the problem/challenge, while the final answer would be made by the manager. An example of such a good against good decision is given –among others – in the book “Business Ethics” by Chris Moon, Clive Bonny et al., (Profile Books Ltd.): A company has very strict rules against bribery but when it comes about human lives which can be saved (for example a pharmaceutical company during a war), decisions are very tough to be made and may be against shareholders opinions, law and reputation. Thus when one have to choose between conceding bribery for many lives to be saved or against bribery (in favor of company integrity, legitimacy and good reputation) and loss of lives, could be in deep water. Many examples could be cited (one is referred to the above book), but the questions are not being addressed.

On conclusion, as above, moral integrity and ethical education can provide the frame for answering difficult moral questions but cannot provide solutions to real dilemmas, who have to been addressed effectively by individual managers.

Another good reference is: Kotler Philip, Lee Nancy, Corporate Social Responsibility, John Wiley & Sons Inc., 2005

Corporate Social Resposibility

I 've been inactive for a while, sorry about that!

I would like to discuss a few things about corporate social responsibility, a fast growing concept which is not as considered such a new idea!

Corporate Social Responsibility

Corporate Social Responsibility is about activities undertaken by corporations and organisations as regards environmental and social issues. It is about environmental protection measures such as reforestation or activities against sea contamination; sociatal issues such as unemployment programs, human rights support, local communities support etc.

Social Responsibility while it seems to be against shareholders' interests and share value can have a positive impact to the price of a share. Several researches from many countries have shown that although there are some others with ambiguous results.

Corporate Social Responsibility:

• Can boost a corporation's reputation (by increased publicity, strong Brand name building, word-of-mouth, etc.)
• Can save millions from prosecutions, negative publicity, riots, provoked by dissatisfied customers, pressure groups, local communities and the sevaral stakeholders (there are many examples of corporations which have been damaged in millions dollars and reputation)

There are several programs that corporations undertake, some of them may be:

• Support for literacy
• Support for Humal Rights and Labour Relations
• Fight against environmental pollution (air pollution, sea contamination)
• Fight against hunger, diseases (such HIV), race and other discriminations
• Support for child's rights and against children's employment
• Local community support (local umemployment, sustainable development and resources of local communities)
• Support for culture, science, sports etc.

There is not any standard program to undertake or any best policy to adopt. The best way to involve into corporate social responsibility practises is to find the needs of your corporation, the obtainability of your objectives and the impact your business has to the sociaty and the environment. Then you can choose the best program to fit your business goals and objectives and create your plan of action. It is also crucial to enable channels for interaction and communication with your stakeholders (shareholders, state, employees, suppliers and customers, pressure groups etc.) and support feedback from those groups. Thus you can be enable to predict the impact of your actions, mentain a good and honest communication and relation with your stakeholders something which will give you their help and support.

That's for now! Stay tuned-in for more articles and resources about Business and Marketing practices...