Business executive • MAY 11
l How leaders and potential leaders can cultivate the skills to master the challenges of the globalising world of the future. The vanguard model is good for business and society. It is
also good for individuals. The newer generations of professionals and managers want satisfying work (and pay, certainly); they also want to be part of an institution that contributes to the common good. We are talking about globalisation, new business models
and changes in the world during the opening years of the twenty-first century. There has always been an interplay between the economy, society and the financial functions performed by businesses. Companies are social institutions, producing jobs and shaping lives through their products, services, norms, and operating standards. Ideas about leadership, change management, innovation,
and regional competitiveness resonate in developing countries and, in some cases, companies are leaping ahead of multinational competitors. We need to understand companies holistically, as they operate in many parts of the world. For example there are
some questions that need some answers: l Are companies responding to changing expectations about the role of business in society in this contradictory era of privatisation that challenges the legitimacy of global capitalism?
l Can social considerations contribute to effective business and product strategies?
l Can companies that are leaders in setting and exemplifying world class standards use their social investments to maintain marketplace advantages in the new global competitions?
l Can they both provide public benefits and improve their own performance?
l Are companies engaging more deeply with suppliers, customers and communities as members of an extended family of partners? Does this nourish the business and provide situations for innovation?
l Can new kinds of social involvements help companies build their brand locally throughout the world, ensure favourable market conditions (stable governments, educated consumers, suppliers and distributors operating to high standards) and make a positive difference to diverse communities? Can this have a high impact and be sustainable over time?
l What are the new workplace challenges associated with progressive business practices, as employees bring new expectations to their jobs in a globalising world?
l Can workplaces be empowering and inclusive, meeting the needs of all people?
l What skills and qualities are necessary for mastering these challenges?
l Who becomes a leader; who is likely to rise to top positions? There are a variety of down-to-earth answers for the new
model for business. In making companies more competitive as well as more socially constructive, there are many practical lessons for managers and professionals at all levels. The vanguard model works through strategy and operations and can improve innovation, mergers, teamwork, and relationships
with government and the public. Vanguard principles can change business practice. Beyond business, we need to explain global change to the general public to illuminate trends and possibilities. We also need to convince informed citizens that, with the right leadership and values, companies can make unique contributions to help produce a better world. Most people in the world do not work for large companies, but everyone is affected by business trends as consumers, community members, and citizens. Some find their well-being and livelihood influenced by the ripples of companies through supply and distribution for larger businesses; also people in non-profit and non-governmental organisations who work on behalf of communities are touched by business, and educators teaching the next generation of potential leaders. At this time of global financial stress, the vanguard
companies have generally escaped the worst of the crisis, outperforming their industries even as markets declined. The messages about the potential for principled businesses
to lead the vanguard of change will hopefully inform and inspire readers. If corporate executives follow the vanguard model, enlightened companies can drive positive change. The challenges facing the world are daunting; for some people business has seemed part of the problem. We need to ensure that business becomes part of the solution. There is a debate between economists; some argue that
the only purpose of a business is to make money, while others demand that companies invest resources to deal with social and environmental issues. The former find it irresponsible to shareholders for companies to take on social causes; the latter think it irresponsible to other stakeholders not to adopt those causes. There is a third way that combines pragmatism and idealism. The new model for vanguard companies enables them to pursue their everyday business opportunities in a way that reflects humanistic values and the promotion of high standards. This helps them grow, quickly and effectively, both solid profits and equally solid reputations. It is not an easy route, but in the long run it will probably turn out to be the best choice. !
VANGUARD COMPANY case study – IBM
A vanguard company gains its powers primarily from the ability to integrate its parts, combine people, and get the action moving quickly. IBM’s response to natural disasters (like the 2004 Asian tsunami) show these capabilities at work for the good of the whole community. About 10,000 people were killed by the tsunami in India. Hundreds of thousands lost their homes.
Local IBM staff were moved to donate medicines, clothes and cash; IBM itself contributed $1 million to the relief efforts. But its most potent contribution was its expertise, its creative problem-solving abilities, and its strong corporate values. Even where there was no direct company self-interest, employees were proud to play their role as citizens. Critical to disaster relief is the ability to track equipment and supplies into the disaster area.
Government attempts to manage the process of locating victims, distributing aid and co-ordinating volunteers manually, can have devastating results. Using skills developed in 2001 in response to the Gujarati earthquake, IBM India created a tracking mechanism that government and relief agencies could use on the ground to make decisions regarding resources and to track missing people. Because it made clear from the start that it wasn’t looking for publicity, IBM got local business partners to participate – for instance using borrowed bandwidth from a local ISP, an IBM customer. This was no ‘arm’s-length’ response involving straightforward donation. Instead IBM staff created
systemic solutions that local communities could use for years to come. IBM went on to develop a disaster relief in a box set of technological resources that could be adapted across the globe. It features open-source software tools called Sahana, which means ‘passion’ – an appropriate name.
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