Matter by Peter Sheahan and Julie Williamson
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Management consultants Peter Sheahan and Julie Williamson report on intensive research they conducted with the leaders of major global corporations to discover how to build companies that “matter.” They learned that successful executives need the courage to challenge tradition, the optimism to envision opportunity amid change and the curiosity to explore uncharted territory. These leaders’ cutting-edge knowledge and flexibility at “the edge of disruption” give them an “elevated perspective” on the market. Their deep connections result in fruitful, “elevated relationships” and their value-based work earns an “elevated impact.” getAbstract recommends this in-depth report to current or future chief executives, leaders and entrepreneurs who want to shape significant organizations. The authors’ excellent case studies, analysis, tips and exercises make it clear that a company that matters delivers deep value to its clients and its community. Here’s how to start building yours.
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- How to create an “elevated perspective” when disruption forces you to merge new and old technologies;
- How building “elevated relationships” with your workforce, colleagues, peers and competitors adds value; and
- How to give your company an “elevated impact” that matters.
Companies That “Matter”
Interviews with corporate leaders worldwide show they share similar strategies for building organizations that “matter” to their industries, employees, customers and communities. They consider their companies’ distinctive capabilities and reputations, and they work with their clients to learn what issues are most important to them and what problems they need to solve. Based on this research, leaders determine which solutions will best serve their clients, add the most market value and open up the widest range of future options. They follow the “matter model” of three intersecting circles: “elevated perspective, elevated relationships and elevated impact.” In 1916, Piggly Wiggly supermarket founder Clarence Saunders realized his customers wanted the freedom to browse his store and choose purchases for themselves. He introduced the shopping cart and launched self-service grocery shopping. The leaders of companies that matter, executives like Saunders, share three vital traits:
- The courage to challenge traditional assumptions about business and consumers.
- An optimistic vision that perceives opportunities for innovation.
- The ability to see the broad picture and the curiosity to explore unknown territory.
“The purpose of life…is to be useful, to be honorable. It is to be compassionate. It is to matter, to have it make some difference that you have lived.” (Leo Rosten)
Self-service grocery stores now face disruption from an updated version of the clerk who filled your grocery list: online orders for home-delivery. This change illustrates the need to stay abreast of the constantly shifting “edge of disruption.” Knowing how changes in technology cause changes in consumer behavior can alert you to consider ways to make your firm matter more.
“To be a company that matters, you need to judge yourself by your impact, not your intentions.”
“Elevated Perspective”
Visionary innovation works only if it can prove it is marketable – and that requires data. Use controlled tests and budget-friendly pilot programs to explore your idea’s practical applications. Engage clients directly to discuss their needs and resolve obstacles. Co-creating with them encourages a deeper bond. Clients naturally feel enthusiastic about solutions they help forge.
For decades, vicious, devious bidding wars ruled the corporate pursuit of major construction project contracts. The tradition of low-ball prices and high hidden costs fueled consumer aversion and industry acrimony. Doug Woods, Peter Nosler and Ron Davidowski founded DPR Construction, which is named for them. Woods challenged the low-ball bid system. He refused to bid. He learned every detail of technical construction, especially the most complex innovations. He sought client feedback. He shared his expertise and gave realistic cost estimates.
“Elevating your impact means confronting your edge of disruption head-on and leaning into the complexity you find there.”
DPR, now a $3 billion company, built a brand known as responsive and knowledgeable. Its client base provides 80% of its new business through referrals. Understanding his complex industry and respecting his clients’ needs elevated Woods’s perspective. DPR now includes clients in shaping its long-term vision. By keeping its clients involved and up-to-date on its edge of disruption, and by sharing data within DPR’s niche market, Woods makes his company the clear choice in that niche. He curates his knowledge into a platform that adds value and inspires innovation.
“Elevated relationships mean you are influencing as high as possible in the organization …cultivating broad relationships and exerting influence on the market.”
“Thought Leadership”
By the mid-1990s, the Internet’s broadening market showed little effect on the wine business. Most consumers and vendors still believed wine signaled either a special occasion or a special sophistication. Then college junior Gary Vaynerchuk, son of a liquor retailer, set up WineLibrary.com to serve an untapped demographic: novice wine buyers. He demystified the exclusive wine world’s inscrutable descriptions, substituting fun attributes like “popcorn” for musty flavor descriptions like “oak.” When broadband channels further disrupted the market, he vaulted into video with his YouTube channel, The Daily Grape. Then he launched VaynerMedia. By 2014, this third venture boasted $30 million in sales, with huge clients like PepsiCo and GE.
Traditional wine reviewers criticized Vaynerchuk, but he stayed committed to his mission to make wine more accessible. Sharing his know-how spurred sales, enhancing his information product’s value. He built connections with wine buyers, suppliers and even his competitors.
“Companies that transform into the obvious choice are also able to convert insights about what they see in their markets into action for their brands.”
The Right Stuff
When executives can create a platform built on a shared vision, then they have an asset they can leverage, for instance, turning a solid reputation into elevated relationships that become influential connections. Such leaders take bold, calculated risks for their vision. They:
“You cannot be the obvious choice if you don’t create more value. And you cannot create more value if you don’t have an elevated impact.”
- Gain access to “key influencers” – Targeting top-ranking decision makers, these leaders address prospective clients’ obstacles with specific solutions. They provide practical support by conducting field credibility studies. They avoid launching sales teams in favor of having more meaningful conversations at higher levels of the corporation.
- Update the sales team – Leaders replace traditional bottom-line sales staff with technologically sophisticated reps who are attuned to each client’s needs. They foster a service attitude and commit to ongoing data and cost analysis. The use of high-tech knowledge in the sales process helps distinguish their firms from price-based rivals.
- Know when to say no – These executives accept only those prospective clients who welcome their firm as part of a team. They focus on partnering with clients with complex needs. They refuse short-term gains in favor of long-term visions of market value.
- Set high standards of conduct – These CEOs and top executives set stringent ethical criteria for themselves, their employees and their clients. When they develop genuine, caring partnerships with long-term clients, they expect those clients to embrace their elevated perspective for their own benefit and for the advancement of entire industries.
- Focus on a future self – Always alert to waves of disruption, these leaders focus on the vision of an ideal future self as they meet increasingly complex challenges, enhancing the market’s perception of their product or service.
“Elevated Partnerships”
Far-sighted CEOs broaden and deepen their elevated relationships. They build partnerships with clients who recognize the opportunities wrought by disruption and understand which solutions generate the greatest value. These leaders engage with their clients’ needs, keeping everyone updated on problems, processes, data and options.
“Change is how an environment continues to unlock new and vibrant forms of value.”
Companies with an elevated perspective seek insight about their changing markets. They interpret data to discover valuable new applications. Luxury auto Mercedes ran a study with the goal of encouraging customers to have their cars serviced on schedule. Researchers found that most drivers leave their cars for servicing when they’re headed for out-bound flights. When Mercedes added service centers – and sales centers – near airports, service checks skyrocketed and new car sales also rose. The Mercedes team also noted clients’ general dissatisfaction with receiving subpar loaner cars. These customers expected the company to trust them to test their best cars, so the company filled its service and rental stations with top models. Once they’d driven the best, customers began buying more of the best. From its elevated perspective, Mercedes moved beyond a short-term fix to improve its long-term client partnerships.
“When the future threatens the status quo, people become defensive and start to think, talk and act out of fear.”
The Big Picture
Astute leaders learn all they can about their firms’ positions in a changing, global society by:
- Examining the big picture – These leaders understand the world’s interconnectedness. They study supply chains, politics, fair-trade deals, new tech and shifting consumer expectations. They seek opportunities in upcoming and ongoing disruptions.
- Forming broad connections – These executives cultivate connections with leaders outside their client or market circles. They form elevated partnerships with organizations that share common goals of positive change. They know relationships enhance product value.
- Improving the system – They identify specific needs and problems that they and their partners can alleviate. They generate widespread, positive change locally or globally.
“By adopting a more optimistic stance, leaders asked better questions – questions that pushed them to identify the opportunities, not just the threats, at the edge of disruption.”
“Help a Child Reach 5”
Unilever’s Help a Child Reach 5 project offers an inspiring example of outreach that puts values into action. William Lever developed Lifebuoy soap with the vision of eliminating infectious, often deadly diseases spread through lack of proper washing. Unilever set out to save lives in India, where widespread lack of handwashing had escalated preventable child deaths and was killing more than 1,000 children under age five every day. The corporation turned to elevated partnerships with global suppliers, distributors and nonprofits such as the Red Cross and UNICEF. They began a grassroots campaign into far-flung villages to promote the habit of handwashing with soap. Habitual handwashing swept India in a wave of disruption, overwhelming traditional cultural norms. Within two years, preventable child mortality dropped by more than 30%, with thousands of lives saved.
“It’s more important for the right people to access your perspective than for a lot of people to access it.”
Lifebuoy became India’s market leader, and its success helped pay for the project. Unilever aligned its resources and partnerships to solve a serious problem for large populations, thus adding value to children’s lives and becoming a company that matters.
“Elevated Impact”
Burberry’s classic trench coat ruled for decades as a must-have fashion item for top professionals. But its aging demographic eroded the coat’s fashion flair as the Internet disrupted its market. Competitors used websites to offer competitive products, online convenience and low-overhead savings. Even the Burberry’s own website sold its products for less than its stores charged.
“The best companies attract the best talent because they do the right thing.”
When Angela Ahrendts took over as CEO in 2006, she discovered she was her own toughest competitor as Burberry.com’s success reduced in-store visits. Ahrendts ordered studies gleaned from social media data and shared the research with a store staff newly trained on iPads. Ideas for improving sales considered customer’s former purchases and their current desires. Burberry embraced cybershopping, offering a brand strategy to meet the changed expectations of online customers and maintaining its elegant shops to please traditional clients.
“The work you, your team and your company choose to do on a daily basis matters.”
Ahrendts delved into the oncoming disruption of millennials’ ideal “celebrity experience” sale. She made sure Burberry’s had celebrity spokespeople and installed cutting-edge fashion tech in the stores. To promote extremely personalized service, in-store technology enabled a customer to hold a garment’s RFD tag in front of an interactive mirror that would then display a video of an artisan making that garment. The video added value to Burberry’s high-priced products, thus encouraging customers “find a ‘rational’ justification for what, given the price, was ultimately an irrational purchase.” The magic mirrors also offered customized images of matching accessories.
Ahrendts made long-term investments in research, technology and training. Burberry’s stores gained customers, and retrained employees found that they often earned higher commissions. Burberry regained market dominance by uniting its employees, clients, systems, supplies and branding. “This is the hard work of elevating your impact, and there are no shortcuts.”
“Companies that matter have high standards and look for opportunities to link their social obligations with their strategy to create generative relationships that renew over time, cementing their place in the community.”
An elevated impact aligns with an elevated perspective and elevated relationships. The executives who’ve built companies that matter share certain personal attitudes, including:
- A sense of corporate social responsibility – doing the right thing.
- A view that short-term losses are investments in a better future and sustainable profits.
- A commitment to growth opportunities for their employees, with jobs that have meaning.
- A willingness to take a stand for their customers’ and communities’ best interests.
- A belief that they can negotiate win-win outcomes to benefit their companies, employees, clients, industries and communities.
- An “authentic commitment to doing well by doing good.”
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The author of Flip and Generation Y, Peter Sheahan is the founder and Group CEO of the international consulting firm Karrikins Group, where Julie Williamson, PhD, is a vice president.
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