Most of us as individuals make new year resolutions and try to live up to them to make us better individuals both in our personal and professional lives. Now, it may be time for organisations to make new year resolutions and strive to to be better organisations in the future.
I would recommend the following priorities as the top twelve for organisations to focus in 2023. They could consider focussing on one factor every month and thus make the world a better place to live in.
1. Move away from shareholder value to stakeholder value: Today most organisations and their senior management are focussed on how to enhance shareholder value. While there is no doubt that the shareholders are the owners of the company and hence we need to add value to their investment, it is important for organisations to realise that all other stakeholders like employees, suppliers, customers, governments and community at large are equally important for sustainability of organisations.
2. Think long term rather than quarter to quarter : Organisations tend to plan and strategise to achieve their quarterly results. While there is nothing wrong in ensuring consistent quarterly performance, it is important to focus on the medium and long term and not just on the short term results of the organisation. Sustainable organisations look beyond quarters and enhance value for all stakeholders.
3. Strive for employee wellness as much as organisational wellness: Managers tend to focus on organisation health. It is important for senior leaders in any organisation to focus on organisation health. If an organisation turns sick then it impacts all its stakeholders. However, it is important for managers and leaders to focus on employee wellness too. This is important because employees take care of all our key stakeholders of the organisation.
4. Focus on Sustainable products and services: We produce products and services to fulfil the stated and unstated needs of our customers. In this process , we may sometimes end up producing products and services, which are not sustainable in the society at large. Hence, it is critical for organisations to ensure that their products and services are always sustainable.
5. CSR should not be a statutory obligation alone: Many organisations today tend to serve communities around them more to fulfil their statutory obligations rather than a duty towards the communities they live in. It is time to realise that organisations cannot survive in an isolated world and hence need to serve the societies around them to thrive and grow in the future.
6. Target Carbon neutrality as a goal: This may appear as a long term goal. However, it is important for organisations to begin with small steps. Leaders need to find ways to neutralise the carbon they produce and emit in the environment so that they can aim to be carbon neutral in the future. This could be done with small steps like self generation of power by using renewable energy and so on.
7. Think “Zero waste” & recycling of resources: Organisations tend to generate a lot of waste and pollute the environment around them. It may be time for leaders to explore ways and means of targeting “zero waste” and recycling of resources so that they reduce unnecessary waste and pollutants in society. Recycling of packaging materials could be a first step.
8. Suppliers are as important as customers and employees: Most organisations focus on customers and then on employees. Yes it is true that customers apart from shareholders are the one of the most important stakeholders. After customers, managers tend to focus on employees. This is important too. However, there is a tendency not to treat suppliers with same value. Is is important to realise that suppliers are as important as customers and more so in times of crisis and hence they need to be partners to our success in good times and bad.
9. Let employee restructuring be the last option always: When an organisation goes through a rough patch financially due to business cycle or environmental factors, the first decision most organisations take is to reduce the number of employees as a way of cost reduction. It may be time to think of employee restructuring as the last option and not the first. Organisations need to realise that employees win customers, sustain suppliers and manage other employees.
10. “Customers” pay us always: It is important for organisations to realise that our “customers” pay us always. They not only pay employee salaries but ensure the sustainability and survival of organisations. I cannot imagine organisations surviving without keeping customers happy. Organisations tend to become arrogant over a period of time when their brand value increases and they distance themselves from customers. Hence, it is important for organisations to revisit their customer orientation periodically.
11. Equity is as important as profits: It is critical for organisations to be in good financial health always. Making profits on a sustainable basis helps organisations to thrive and grow in a competitive market place. However, it is important to realise that maintaining internal and external equity for all its stakeholders is equally important. Organisations have to ensure that equity is a value while dealing with customer issues, supplier problems or employee salaries. This will ensure its survival and growth.
12. Ethics has always to be a way of life: Shortcuts may yield quick results. This may end up in higher profits too. However, if organisations do not make “ethics” as their core value in all their business operations, they may not survive in the long run. History will always teach us that ethical organisations only can survive and grow in the long term.
As in the photo above, organisations also have equal responsibility to make the world a beautiful place like this exotic flower in the garden.
While the above 12 may not be the only priorities to focus on and may not be equally relevant to all organisations, they could be considered as important foundations for a sustainable organisation of tomorrow.
S Ramesh Shankar
15th Dec 2022