BM_IMD_REPORT-How-Authentic-is-your-Corporate-Purpose

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We buy from suppliers with whom we’ve had a relationship for years and with whom we want to continue having a relationship for many years to come. Many years might mean 20–30 years. The continuity of the company and this long-term perspective requires a rooted sense of underlying corporate purpose, because we have been there and we will be there. We are in this market niche for the long-run, so we have to be really true about it, to be perceived as we want to be perceived … as a long-term player. Inter-dependence of purpose and external stakeholder relationships Tetra Pak’s primary external stakeholders are its customers. Much of its sustainability work is done with the perspective of helping the future of its customer’s businesses. The company has realized that in order to be a supplier of choice for its customers, it also needed to contribute to their environmental performance. The above-mentioned director describes the centrality of purpose to its customer relationships as follows: In our relationship with our customers, the purpose and the continuity are very important and this has become part of our values. In every business relationship, you are also using your values as part of your selling proposition. The sustainability values come from the real intent of the company, of its purpose. They can be validated by being part of what you represent to your customers. Achieving recognition from customers is a challenge. While some customers value a lower carbon or water footprint, most are not willing to pay a higher price tag associated with them. To be as creative as possible with solutions and increase the chances of success, there are a number of challenges. Organizations must acquire new levels of creativity, deeper knowledge and internal competences that will enable them to collaborate with a variety of external stakeholders. In this way, the company understands better what the possible solutions can be. This has lent itself to a collaborative approach, and Tetra Pak remains close to its stakeholders to find solutions: We need to understand what the possibilities are, not just by asking the supplier a question or a number of questions about carbon footprints, but by understanding what makes up the carbon footprint of their product and then working with them to reduce that carbon footprint. And if they are the supplier we want to work with from a business, commercial and risk perspective, it’s not only price that counts – it’s about risk, it’s about engagement, it’s about sharing goals for the future. Then by working with them we can find an optimized value chain for this supplier that reduces their carbon footprint rather than just buying from someone else. Tetra Pak views developing and sharing knowledge with its peers, to better understand how to move forward in a way that is consistent with its purpose, as a fundamental differentiation factor. As a result of its continuing engagement with its stakeholders, Tetra Pak has acquired a deep – difficult to replicate – awareness of its purpose, as well as a commitment to pursuing it. We often make presentations to customers, to internal stakeholders, to government teams of other organizations or within Tetra Pak where we try to present why we are doing this and why we think this is the right way forward. We try to present on a peer-to-peer basis, in order to offer support. Tetra Pak is very open and people are free to speak. It’s a very Scandinavian culture. If people have an opinion, we are going to hear that and engage in a conversation. Recommendations for Increasing Organizational Awareness To build this capability, leaders and stakeholders should pay special attention to the following: 30
1) Seeking feedback from stakeholders. 2) Being aware of the impact the organization has on its stakeholders. 3) Understanding the reason behind the organization’s actions. 4) Understanding what drives and motivates the organization. 5) Understanding what the organization finds truly important. 8.2 Embeddedness An organization that is “embedded” has a close relationship with its stakeholders and the world around it. Leaders and stakeholders concerned about embeddedness should first ask themselves these questions: - Is the organization disconnected from the world around it? - Is the organization distant from its stakeholders? - Does the organization have a sense of connectedness with society? - Does the organization have a relationship with its environment? Case story: Google Innovation Lab for Food Experiences Google is a global technology leader focused on improving the ways people connect with information. In 2013, Google has 70 offices in more than 40 countries around the globe, its products and services were available in over 100 languages and 50 countries. It had $60 billion of revenues (90% of which were generated from advertisers), with the US accounting for 45% of its revenues. Google’s business is primarily focused around the following key areas: search and display advertising, the Android operating system platform, consumer content through Google Play, enterprise, commerce and hardware products. Google had 47,756 full-time employees in 2013. Larry Page and Sergey Brin started the company as a result of Page’s doctoral research project in 1998. Google’s initial public offering took place in 2004, raising US$1.67 billion and providing Google with a market capitalization of more than $23 billion. Its founders retained a strong involvement in the business and had intentionally done so in order to retain control and lend continuity to Google’s activities and contribute to its corporate purpose. Google’s mission is “organizing the world's information and making it universally accessible and useful.” While it is well known for having revolutionized online searches, Google sees its purpose as being broader: using information technology and data to address broader global issues and, as one executive put it, “make the world a better place.” Thus, purpose is at the core of Google’s recruitment and HR practices; it attributes its ability to attract talent to the belief that the organization is working on effecting positive change in the world. Google also allows its employees the freedom to work on projects they believe will have a positive impact on the world. Its 47,756 full-time employees (Googlers) may use 20% of their time to work on innovation projects that they have selected themselves and that they are passionate about. Such projects have resulted in successful Google innovations including Gmail, Adsense, Google Transit and Google Talk. This open innovation approach also encourages the development of leaders within Google, by helping them to work in a non-hierarchical way. In addition, Google leaders are empowered to make 31
Page 1 and 2: How Authentic is your Corporate Pur
Page 3 and 4: Contents Executive summary ........
Page 5 and 6: Executive summary Introduction Over
Page 7 and 8: although awareness is critical to a
Page 9 and 10: Research by Burson-Marsteller and I
Page 11 and 12: To validate the dimensional structu
Page 13 and 14: Leading Image: In contrast, researc
Page 15 and 16: 4. Survey Results and Key Findings
Page 17 and 18: Figure 4: Top Five Companies with a
Page 19 and 20: We then asked more specifically for
Page 21 and 22: 6. Leadership and Authentic Corpora
Page 23 and 24: 7. Qualitative Research Findings In
Page 25 and 26: One executive described the “doub
Page 27 and 28: companies as members. Other such fo
Page 29: - Is the organization aware of the
Page 33 and 34: knowledge for the broader good. Tha
Page 35 and 36: - Does the organization openly shar
Page 37 and 38: • Strategy has to illustrate purp
Page 39 and 40: making process. If managers are not
Page 41 and 42: De Hoogh, A. H., Den Hartog, D. N.,
Page 43 and 44: Leading 13. Appendices Appendix I:
Page 45 and 46: Appendix II: Qualitative Interview
Page 47 and 48: Appendix III: Qualitative Interview
Page 49 and 50: Appendix V: Characteristics of Surv
Page 51 and 52: Appendix VII: Industry Demographics
Page 53 and 54: Appendix IX: Companies Identified a
Page 55 and 56: Appendix XI: Ranking of Full List o
Page 57 and 58: Appendix XIII: Status of Authentic
Page 59 and 60: Appendix XV: Standardized item fact
Page 61: Appendix XVII: Confirmatory Factor

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