The Case For Good Business
Updated: Feb 4, 2019
Here are some snippets from a great article by NZEntrepreneur:
"Business leaders and marketers would have to have their head firmly in the sand not to see that today’s consumers are increasingly voting with their wallets, and choosing where possible to support brands operating with a higher purpose.
But aside from just doing the right thing, it’s good to know that for the number-cruncher’s out there, doing conscious business is not just good for the planet, but also great for shareholder returns
For far too long now business has put profit at the heart of its measurement of success and, in many cases, made this the single determinant of a company’s success. Although this is an important aspect for the longevity and sustainability of a commercial enterprise it is not the only one, and there are many other factors that determine overall “success”.
Businesses need to consider a wider range of criteria rather than purely financial performance and a business that operates with a higher level of consciousness will consider other aspects of wealth creation including intellectual, social, emotional, cultural, physical, spiritual and environmental.
Although not surprising to those that truly understand this approach it is fascinating to others that those companies that operate with this broader mandate have proven to significantly outperform traditionally operating businesses from a financial perspective.
They grow faster than their competitors by aligning better with the needs of their customers who grow to become ‘raving fans’ who continue to spread the word. As a result they are typically spend less on promotional activities and also grow market share.
At the same time they invest into areas that have a big impact on productivity and both staff and customer retention (such as team happiness and the customer experience) and this creates significantly less on things like staff recruitment.
Here’s How Good Business Works:
Higher sales are achieved based on greater acceptance by customers who in turn become ardent fans and advocates. These companies consistently outperform industry averages on metrics such as revenue per team member thus generating more revenue on a comparable asset base than their competitors. As such they can afford to pay better wages and create a virtuous cycle of well-paid team members with a true passion for their work and for serving customers that in turn creates a superior customer experience. Their people are more productive, consistently creating excellence with greater innovation and love for what they do that clearly becomes contagious all round.
Lower marketing costs are possible thanks to a large number of ‘raving fans’, delighted customers and staff who love their work. Customer retention is high as is word-of-mouth advertising from the many loyal and passionate advocates for the company. Many conscious businesses spend as little as 10 to 25% of the industry average on marketing with huge cost savings on traditional marketing strategies.
Staff happiness + higher engagement = much lower staff turnover. This equation says it all as most people will be familiar with the high cost of recruitment and training for new employees. When a company takes care to hire those with passion that aligns with the company purpose and truly values its people they simply stay longer, love their work and are more productive. The significant savings that this creates are then re-invested into their people providing benefits that in turn enhance loyalty, passion and longevity."