Philip Sheldrake

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Category: Financial & Corporate

The meaning of business

open for business

Why do firms exist? Strangely, no-one appears to have asked this question until a 27 year-old economist did so in 1937.

Ronald Coase published his answer in The Nature of the Firm, now considered a seminal text. He studied the circumstances that led entrepreneurs to hire people as employees instead of simply contracting jobs out to traders and came up with the answer we now simply refer to as transaction costs. People are hired when the various associated costs are lower than they would be otherwise.

Here's a similar sounding question, but one that is actually fundamentally different. What is the meaning / the purpose of business?

Coase needed to look no further than economics to explain why firms exist. Their existence is a binary thing. But any question seeking to address meaning and purpose encompasses philosophy, sociology, and politics.

Unavoidably, any answer is framed in terms of ... What's best? What's optimum? Why? How? And for whom?

Euler Partners sense Summer 2016 - the meaning of business

The answer was in fact framed economically for a long time in terms known as shareholder value, and perhaps Coase's question and answer influenced this blinkered perspective. But we've found and are still finding that a different answer can lead to superior economics, and not just in terms of profitability but in terms of the triple bottom line – people, planet and profit.

Euler Partners' just published its sense Summer 2016 report, The meaning of business. Available here as PDF and also on Medium.com. If you're frustrated with today's typical responses to this question, and / or if you want to build sustainable business, you'll find the report provoking.


Image credit: By Leo Reynolds, CC BY-NC-SA 2.0

Conversations start with something interesting to say delivered in an interesting way – Part 2

I posted a few weeks back about how organisations must engage stakeholders in dialogue, and how this conversation starts by not just having something interesting to say, but delivering it in an interesting way.

After all, whilst marketers consider the 30 second ad to be on its last legs because it tries to wallop all and sundry, you can take longer to get your point over if you're talking to those whose interest is already sparked and who want to find out more.

My last post featured a video and an animation, and I promised to come back with some more formats for starting a conversation in an interesting way. For topical reasons I have another animation for your interest, but the main feature in this post is a call-to-action-microsite. Read more

Enhancing Organisational Performance Management with the Influence Scorecard

Influence%20Scorecard

Last week I posted about hosting a meeting on the Influence Scorecard. The post was testing the water to determine the level of interest such an event might generate, and I was answered by dozens of emails, direct twitters, comments and even some direct editing of the post itself, as I'd hoped! (MarCom Professional allows an author to permit others to edit a post, wiki-style.)

I even received tentative enquiries about sponsorship, so it looks like we are on to something here...

Moreover, the interest was split almost 50:50 between Europe and North America, and it was spread fairly evenly amongst each of the required participant groups.

What is clear from all the queries and interest is that we now need to put some meat on the bones.  Here are a few top line thoughts on 'influence', 'scorecard' and what we hope to achieve.  Your thoughts are welcome.

Influence

Organisations want to influence the opinion and behaviour of their stakeholders. They do this via the various marketing and communications disciplines and approaches - PR, advertising, branding, community building, conversational marketing, direct marketing, events, product placement, public affairs, sponsorship etc..

Of course, stakeholders also influence each other and some will want to influence an organisation - how ready an organisation is for this dialogue is another matter.

Scorecard

The 'scorecard' is inspired by the Balanced Scorecard, one of the most widely adopted organisational performance management methodologies (generally known as "business performance management" or just plain BPM). According to the Balanced Scorecard Institute: Read more

Influence Scorecard – defining influence measurement for organisational performance management

Influence%20Scorecard%202009

When I first decided to write The Social Web Analytics eBook 2008, I had no idea it would attract over 10,000 downloads in 100 days. And why does it continue to be downloaded 1,000 times a month? In hindsight, the reasons are plain:

  • Listening to and learning from all our stakeholders is a widely and keenly felt desire
  • Acquiring a grasp of the reputation our company and brands have notched up must constitute a key organisational performance metric for anyone
  • Understanding how our interaction and dialogue with our stakeholders contributes to the achievement of our marketing and communications objectives helps us quantify how well we are meeting those objectives. Read more