Firm Focus = Shared Value + Value Proposition

Value proposition is nothing more than a believable collection of most persuasive reasons that your customer notices you and takes the action you are asking for. Focusing on the prime needs of your customer is how the businesses try to create value in the ecosystem. Each customer has the tendency to search 4-5 different options before arriving at the final selection. Firms try to stay ahead by uniquely positioning its product/service offerings different from its competitors. Regardless of whatever one firm does, it always has a competitor who is doing better (barring the one who is leader).  There will always be existence of companies whose brand sells more than yours, people whose blogs have more readers than yours, there will be websites which will have more per day hits than yours and the list is endless. We can find innumerable comparisons from our daily interactions as a customer with different firms. But is it that staying focused only on the value proposition front means that it is also serving the larger purpose of creating value for the society? Businesses need to extend their thought process further, reinvent their strategies and must evolve towards creating shared value.

The society in which the businesses operate cannot be completely ignored. Firms need to look for opportunities in the manner they can uplift the society. Apart from creating employment opportunities for the individuals living in the peripheral areas, firms need to think on formulating clear business strategy to create shared value. They have to unleash their power to create a strong impact on the society and work on tackling the common global issues. Opportunities do not remain static but constantly keeps on changing with the advancement of technology and with the changing dynamics of the highly interlinked economies. It must be a win-win situation for both - firm and stakeholder and not the win-lose relationship. 

Over exploitation of natural resource by the firms is a major topic in discussion these days. Especially the companies which are into direct association with the use of environmental resources like mining firms (which leave a major impact on the environment in the areas of their operation) have to work substantially on creating value for the society at large. The leadership in these industries have to engage their employees by providing clear direction in achieving ethical & sustainable objectives along with the core business activities. A good example of creating shared value can be Rio Tinto (a British-Australian firm active in mining business), which defines a parallel target of creating project positive impact for every project it works on. It tries to identify the opportunities available on the social-economic front before proceeding for the project and holistically works on the same.

Measuring the impact of firm's actions becomes an important parameter in evaluating the impact of shared value. As the concept of creating shared value is still its infancy, the complete framework for measurement of social impact on the economic business is evolving. But firms have started accepting the ideology that there lies a congruence between the improvement in productivity of the firms and creating shared value for the society. More the firms start thinking of the innovative ways to make the societies progress, the more they benefit and thus, the more they become more productive in the value chain. Sustainability standards have also increased awareness among the corporates of their impact on society and thus have triggered meaningful improvements in social and environmental performance. For eg.: Recent energy price spikes have challenged everyone to think in terms of higher efficiencies in energy utilization and has thus brought a wave of revolution in this energy efficiency market. It has helped the companies reduce their energy costs and also created new employment opportunities for the society. 

The Global Reporting Initiative (GRI) has laid down voluntary reporting standards on ESG (environment, society and governance) and many Fortune-500 organizations are already part of this reporting network. Many corporates like Siemens are already working proactively on sustainability front and are promoting same by conducting sustainability awareness programmes. The success of companies in future shall be linked to their evaluation on social, environmental performance along with the financial aspects. These firms will have an integrated strategy to target financial goals and simultaneously create value for the society and its stakeholders. Taking consistent, persistent and focused action is always easier said than done. The challenge that still remains is daunting and task is tough and the firms have to really delve into it to make it a success !

Abishek Mittal

NMP XXVI - Class of 2014

MDI, Gurgaon

Building a Perspective

Perspective is simply the state of one's own ideas. How come that this term has garnered so much importance these days? Why is it insisted time and again to have your own perspective? Be it a business place, home, educational institute or anywhere else, having your own perspective on an issue is important and is deeply stressed upon. It is distinctly visible that perspective does play a major role in B-School these days during the lively group discussions. People who have developed this habit excel in thinking and are good in communicating their thoughts with clarity and precision.

The world has become really a complex and smaller place with the penetration of technology and round the clock availability of cheap transport. Humans are being bombarded with loads of information everyday from various channels. Each one of us is hooked to internet day in and day out via WiFi hotspots, Smartphone, laptops, tablets etc where we regularly come across many current hot issues. It is solely for us to decide when to keep hold of the information, when to agree to the viewpoints presented, when to differ from what is said and when to let it pass freely. But, after going through the issue, sitting back and pouring in your thoughts is what matters the most. This is where the originality plays its role and can lead to a change. It is a beauty of human ecosystem that each one of us have our unique way of living, unique way of thinking and unique way of viewing the things. This is because all of us have come across different experiences in our lives and represent different cultures of shrinking global village.

Building a perspective imparts overall clarity to ones thought process. We must not develop the habit of passively believing and uncritically accepting whatever we have learned over the past years. Rather, we should start raising questions and rejuvenate our thoughts to find a reason whether our viewpoint is well deserved or not. There will be many times when we may not be accurate but the fear of being rejected should never deter our thought process. On the other hand, holding a perspective without any valid reasons (solely on ones intuition) can be negative and must be avoided. Once we have reached this level of clarity and purpose, it will help us to overcome the existing challenges, thus leading to achievement of our goals. 

So, i will close today's blog by stating that we must "Think Original, Think Different !"

Abishek Mittal

NMP XXVI - Class of 2014
MDI, Gurgaon