“We’re celebrating ten years. Thank you to our customers who have made this possible.”
Sign in a restaurant in Connecticut
But don’t forget another constituency that is fast becoming a company’s most important constituency to serve, because of its power to help a company to grow profitably!
We visited my wife’s nearly-99 year old mother this week, and went out for lunch at a local restaurant. Those were the words on a special announcement at our table. I read it and thought, that’s great – they have made it to the tenth anniversary. That’s a notable accomplishment in the restaurant industry. And how nice to thank their customers.
That was several days ago, and the sign still rattles around in my brain. In fact, it haunts me. Why? Because they’ve mentioned only part of the formula for success!
So, let me ask you:
Whom does your business serve?
That sounds easy: We serve our customers, for without them, there is no business. That’s been the mantra for years. But is that really the whole answer?
The financial folks started a push a few decades ago to refine our thinking so that we kept the shareholder in mind – in fact, first in mind. That’s behind most of Wall Street’s moves to restructure companies so they provide a greater financial return to financial shareholders, and thus greater shareholder value in the price of the company’s stock.
Okay, so there’s both the shareholder and the customer that we serve. But there’s another constituency we serve. And it often gets forgotten or overlooked. That is our employees. Funny how many annual reports say that “our employees are our most important asset.” Yet those same companies too often forget that humans are not just a resource; they’re a constituency that we serve.
Perhaps it is best said by David Neeleman, founder and head of three successful airlines, the most recent being JetBlue. At a meeting I attended some years ago, Neeleman explained his people-centered philosophy of leadership. During the Q & A, someone asked, “That’s all well and good, but how do you explain that to the financial shareholders whom you serve?” I still remember his quick, curt response so vividly. Without even stopping to think, he spoke these words about the way he saw the profit equation and management’s role in it:
“We serve our employees, who serve our customers, who serve our shareholders.”
Boom. End of story. How clearly that statement rings!
So, back to the restaurant, just think how powerful it would have been for them to state:
Thank you to our loyal customers and dedicated staff, for without them, we would not be the restaurant that we are today.
The best way to drive home this truth may be to tell you about companies that I know that purposely and consciously “serve” their employees. Here are two:
Prosperity Candle – whose motto is “empowering women globally”
Amber Chand, co-founder of Prosperity Candle, created a mission of helping women in war-torn areas to create a livelihood for themselves and their families. They train the women and support their becoming entrepreneurs. It’s not a government or non-profit program requiring outside funding. It’s funded by (mostly) American consumers who buy their products.
A more in-depth discussion with Amber is provided in our Newsletter from Summer 2009.
Nick’s Pizza & Pub – http://www.nickspizzapub.com/home/
Nick Sarillo wanted to create the best pizza restaurant in the industry – and to do that, he didn’t work on developing the best recipe. He already knew how to make pizza – his father had a pizza restaurant. He focused on people – both customers and employees. I won’t go into his employee practices here, but just consider the results: a profit margin historically well above the industry average, with employee turnover a fraction of the industry average.
A more in-depth description of Nick’s is provided in an earlier blog post.
These are just two companies that treat the people who work in/for their companies as not only “valuable resources” but as constituencies that must be served if the business is to thrive. I plan to include them in my forthcoming book as examples of a “new business model” that I see emerging.
So now go back to my original question, and answer for yourself
* Whom does your business serve?
* And furthermore, what might you do so that/those constituency(ies) feel(s) well served?
* And, regarding the employee dimension of your company, what might you do to inspire and motivate them to help take your business to new levels of growth, innovation and profitably?