October 31, 2011

News & Opinion: Despite protestations, changes are being made in business

By: 800-CEO-READ @ 7:51 PM – Filed under: Management & Workplace Culture

Amid the press coverage of Occupy Wall Street, the Tea Party, government gridlock and bankrupt foreign countries, there is some evidence that there has begun a process of change with a new thought framework that serves as a backdrop to mistrust of government (89 percent in the latest New York Times-CBS News poll) and a hatred of big business. Worldwide, there are a number of individuals and institutions that are taking things into their own hands and improving the world in their own way, and three books illustrate the changes. Start Something That Matters Blake Mycoskie, who rose to fame as a contestant – along with his sister, Paige – on the CBS reality television series, The Amazing Race, has written Start Something That Matters. The book illustrates not only his founding of Toms Shoes, but also serves as an overview of how to start what Mycoskie simply calls something that matters – eschewing the many other monikers such as good company, conscious company, compassionate company and others that cover the various shades of making profits while improving the world.    Mycoskie is a serial entrepreneur, having started three businesses before starting TOMS (the name has nothing to do with a person, but rather is an abbreviation for Tomorrow’s Shoes). He was inspired to start TOMS after a second trip to Argentina, the first was a somewhat brief one during the Amazing Race show, and saw the multitudes of people wearing alpargatas – a lightweight canvas shoe – and the multitudes of children who could not afford shoes at all. After much thought and consideration, he came up with the idea of selling the shoes in the United States and other parts of the world while providing a free pair of shoes to those children for each pair sold. A taste from the book:
TOMS is only one example of a new breed of companies that are succeeding at this volatile moment in capitalism. The tremendous growth of TOMS would never have been possible during my parents’ generation or even when I was first getting started in business in the not-so-distant past. In this fast-paced and constantly mutating world, it is easier than ever to seize the day, but in order to do so, you must play by a new set of rules – because, increasingly, the tried-and-true tenets of success are just tried, not true. What you now hold in your hands is a guide to help you and anyone who is interested start something that matters. In this book, I describe some of the counterintuitive principles that have helped TIOMS grow from an interesting idea to a company that in five years has given more than a half-million pairs of shoes to children in need.
Infinite Vision Equally interesting is the story of Aravind Eye Care Hospital in India. Due to be published at the end of November, the book provides a detailed accounting of the founding and success of the for-profit business and how it has succeeded in providing a continuum of care from high-end care wrapped in creature comforts to free care that returns the poor in the country to the ranks of productive member of society, the only alternative for which is begging in the streets. The amazing part of the story is that all the care is provided with the same high level of quality and compassion – whether the patient is a millionaire or pauper. The key to all of this is a ruthless efficiency combined with skillfully channeled compassion. Each day, the company performs 7,500 outpatient visits; between 850 and 1,000 surgeries; conducts five or six outreach camps at which 1,500 patients are examined and 300 patients are transported to base hospitals for surgery. That’s every day. And at a success rate higher, with fewer complications, than hospitals in the United Kingdom. As one might expect, there are a myriad of actions and approaches under the twin umbrellas of efficiency and compassion and it would be natural to wonder if the approach is sustainable. The family that runs the business has been at it for more than 25 years and is heading into a new generation of leadership. One of the secrets to its success is adapting to changing realities, including the constant upgrade to its equipment, procedures, systems, and approaches to reaching potential patients. Infinite Vision tells the tale of a business that, if it could be replicated, would revolutionize health care across the globe. Clinics are either established or planned in Egypt and other African nations.  The Fortune at the Bottom of the Pyramid A seminal book on the melding of for-profit business and improving the world, The Fortune at the Bottom of the   Pyramid: Eradicating Poverty Through Profits, was first penned in 2004 after the author, C.K. Prahalad, Paul and Ruth McCracken Distinguished University Professor of Strategy at the Ross School of Business at the University of Michigan, was inspired to develop a new paradigm around the world’s poverty and how for-profit business could work toward lessening it. The 5th Anniversary edition of the book adds a new introduction, video clips about the featured companies and updates written by the CEOs of the companies featured in the original book. Fortune at the Bottom of the Pyramid examines 13 companies and how they have worked to reduce global poverty while executing the thesis and research that Prahalad has uncovered and developed. The upshot is an amazing account of how it’s being done and how others can do it in the future. Taken on their own, each book outlines an interesting part of a growing trend that underscores the notion that relying on government to cure poverty and other ailments is futile and inefficient. Taken together, they record a point in history when business stepped up. They remind us that it is always better to make our own way and take matters into our own hands. The largest remaining question: Why don’t more of the examples come from the United States where much work also needs to be done.