Civic entrepreneur Tom Hayes believes that a new kind of enterprise will become the engine for good works — and good work — in the future. He calls it the “socially networked company” — a business that builds its market power by maximizing intangible assets such as goodwill, community support, and employee pride. Says Hayes: “The successful organization of a decade from now will be one that recognizes that the real value of the business is not on the balance sheet but in the relationships it develops with a whole range of constituencies.” Hayes explains the five principles behind the socially networked company of the future.
- Doing well means doing good. There’s been a fundamental shift in the adversarial relationship between business realities and social mission. If you are good to your own people, business allies, customers, and the community, you can still make a lot of money. You can become filthy rich being decent to people.
- Work is social. Business is the most powerful force in our society. Work has become the primary place where people define self-worth. In Silicon Valley every company I know, and every person I know fully expects to change the world. The next step is for them to realize they already are — in how they source their products, how they hire, how they invest — and to take responsibility for it.
- Community investments create value. If you take care of your community, it will take care of you. Community investment is an above-the-line activity. That support is an asset, so it’s a good business strategy to invest in and maintain that asset.
- Character counts. The Information Age has created a vast array of choices. Where we work, what we buy, how we sell are now open to reconsideration every day. All other things being equal, the brand that stands for something beyond just making money is not only going to win a lot of purchasing decisions; it’s also going to recruit the best talent.
- Raise the stakes How many companies today would be willing to dedicate 5% to 10% of their pretax earnings to social good? Not many. How many would be willing to change their basic business practices to strengthen the social compact? Fewer still. But if companies really looked at what captures and keeps customers, recruits talent, and strengthens ties with strategic partners, they might be willing to take the first steps in that direction.