This past January, Time magazine developed a special report, "Getting Smart at Being Good ... Are Companies Better Off for It?” Partially answering that question in the article’s subtitle, the report observed, “Not everyone says yes, but a growing phalanx of CEOs thinks that, done right, corporate caring bolsters bottom lines.” Click here to read the full report.
Five months later, the June 12 edition of Advertising Age carried a special report, The New Samaritans” that observed, “Corporate social responsibility grows as marketers find that doing good is good business.”
More recently the June 26 issue of Business Week carries an article entitled, “Charm Offensive; Why America's CEOs are suddenly so eager to be loved.”
Not everyone looks on the trend towards more humanistic enterprises in a positive light. Stephen Bainbridge, a corporate-law professor at the University of California, Los Angeles said in the Time special report, "In a nutshell, the problem with CSR (corporate social responsibility) is that managers who are responsible to all of their constituencies are accountable to one."
But Mr. Bainbridge is dead wrong. He represents the either/or mindset that provides a sharp binary focus, but that restricts creativity. It is a mindset born in Newtonian physics where every event in nature has a predictable cause. But humans are not as predictable many would like, and business corporations as extensions of human personalities similarly resist deterministic explanations of their behavior. Advocates of CSR tend to have a more adaptive view of matters: "There is only so much we can change, but we almost always can adapt."
The number of articles devoted to the subject of corporate social responsibility is rising rapidly. CSR has reached the critical mass of a full-blown movement. One of the casualties of this movement is the silo view of organizational structure. In the companies that we researched for the forthcoming Firms of Endearment (January 2007) there are few if any marketing departments in a traditional sense. Marketing is a company wide function in which in the grocery business even checkout clerks are part of the marketing team.
Interestingly, few of the companies we cited as exemplars in Firms of Endearment have much of an advertising budget. They are masters at creating buzz on a low cost basis. A number of the brands we feature in the book have an almost cultish quality about them. In fact Commerce Bank founder Vernon Hill unabashedly tells his employees, “You are all cult members. And if you can’t buy in, this isn’t the place for you.”
Harley-Davidson, Whole Foods, Patagonia and others we identify as exemplars of CSR hold a special place in the hearts of a large segment of their consumer constituencies. This is true also among their employees, the communities in which they operate and, of course, their shareholders.
Looking at these developments in a marketing context, as the future unfolds, marketing will be less about creating award-winning ads and more about harnessing the residual energies in all stakeholder groups to shape company success. This is why we prefer the term stakeholder relationship management (SRM) to corporate social responsibility. In fact, we believe that SRM will replace CRM (customer relationship management) as a strategic tool. CRM’s value will be in its use as just another tactical tool used in marketing.