Leadership must be practiced consciously. Which leadership credo will guide your team: purpose, value, collaboration, or relationships?
You want this year to be bigger and better for your team. Got any idea of the path required to achieve that goal? Define your credo.
The single biggest CIO challenge is finding a balance between what needs to be achieved and how that will be accomplished. Solving this complex problem can ensure a lengthy CIO tenure or expedite unplanned job opportunities. What you achieve as CIO matters. How you accomplish it also matters.
Build a credo to unify your department. Determine how you’ll lead this year:
- With purpose
- With value
- With collaboration
- With relationships
How you lead will impact those that follow. Define what you want to achieve and how that will be accomplished by identifying your leadership approach.
Lead with purpose: natural capitalism
The concept of natural capitalism was first introduced in the book, Small Is Beautiful: A Study of Economics As If People Mattered, which was published in 1973 and written by Ernst Schumacher, a statistician and economist. The book is segmented into four sections:
- The Modern World: focused on world economics
- Resources: focused on natural resources
- The Third World: focused on global and social change (aka the World-systems Theory)
- Organization and Ownership: focused on humanism
Natural capitalism proposes addressing global issues by providing essential goods and ecosystem services—e.g., food supply, water supply, carbon storage, and energy supply—through societal and environmental changes wrapped in a context of human wellbeing.
Twenty-six years later, in 1999, Paul Hawken, Amory Lovins, and Hunter Lovins wrote the book, Natural Capitalism: Creating the Next Industrial Revolution. This book is a critique of traditional “industrial capitalism,” which made the argument that the classic system of capitalism doesn’t place value on natural-resource and living systems or human capital—including social and cultural systems.
Leading with purpose—natural capitalism—focuses on conservation of resources, reuse of materials, changing values, and sustaining natural resources.
Lead with value: the triple bottom line
The origin of the phrase, the triple bottom line, is largely unknown, although John Elkington, a writer and authority on corporate responsibility and sustainable development, evangelized the term in his 1997 book, Cannibals with Forks: the Triple Bottom Line of 21st Century Business.
The concept of leading with value was first published in 1981 by Freer Spreckley in a work titled Social Audit—A Management Tool for Co-operative Working. In this work, Spreckley referred to defining success as economic, social, and environmental, stating that “…companies can give rise to social and environmental costs which are not recorded on the balance sheet as a business cost.”
The triple bottom line alters the classic profit-and-loss focus in the bottom-line statement of revenues and expenses to include people, planet, and profit.
- People: the social-equity bottom line
- Planet: the environmental bottom line
- Profit: the economic bottom line
The phrase, “the triple bottom line,” adds two more bottom lines—social and environmental (ecological) concerns—as factors for determining success. These social and environmental costs are hard to measure and are shouldered by employees and the local, national, and global community.
Leading with value—the triple bottom line—focuses on balancing profit, a positive societal impact, and a neutral or positive environmental footprint while generating profits.
Lead with collaboration: shared-value capitalism
Creative shared value (CSV) was formally introduced by Michael Porter and Mark Kramer in a 2006 HBR article titled, “Strategy & Society: The Link between Competitive Advantage and Corporate Social Responsibility.”
The concept of creative shared value (CSV) is an extension of corporate social responsibility (CSR). The approach centers on the premise that companies can create shared value opportunism using three methods:
- Reconceiving products and markets: create new products, adjust existing products, or innovate new ones.
- Redefining productivity in the value chain: Improve quality, quantity, cost, and reliability while being socially and environmentally responsible.
- Enabling local cluster development: partner with surrounding companies for economics of scale—similar to the concept of coopetition (collaboration among business competitors with the goal of mutually beneficial results).
Much of the analysis of the shared-value capitalism concept concentrates on tweaking the value chain and specifically explores the social influences on competitiveness in four main areas:
- The rules and incentives that govern competition
- The nature and sophistication of local customer needs
- The local availability of supporting industries
- Presence of high-quality, specialized inputs available to firms
Adjusting these levers of influence closely parallels the conventional idea of corporate social responsibility (CSR) programs. The challenge, of course, is that companies attempt to solve the substantive problem of “shared value” by masking it with a temporary “image problem” that can be solved by small shifts rather than a tectonic movement of culture followed by action.
Leading with collaboration—shared-value capitalism—embraces the idea that the most important objective for a company is to contribute to a prosperous economy and community.
Lead with relationships: conscious capitalism
The concept of conscious business was reframed as conscious capitalism in the book, Conscious Capitalism: Liberating the Heroic Spirit of Business, by John Mackey, the former co-CEO of Whole Foods Market, and Raj Sisodia, co-founder of the Conscious Capitalism Institute and author of the 2007 book, Firms of Endearment: How World-Class Companies Profit from Passion and Purpose.
Conscious businesses are companies that benefit human beings and the environment in their business strategy. This movement emerged from the CSR wave within the U.S. that emphasized a value-based approach of considering social responsibility in the context of local and global. The adoption of a local-to-global mindset began in the late 1990s when globalization as a social, cultural, political, and legal phenomenon was alive and well.
Conscious business, however, isn’t only focused on sustainability, as it’s possible to be environmentally sustainable and not operate a conscious business. Leading a business consciously is about being aware of and responding to your surroundings.
Leading with humanity—conscious capitalism—elevates the idea that organizational awareness, self-awareness, and awareness of purpose are essential when leading an organization and refocusing culture.
There are four concepts of conscious capitalism: higher purpose, stakeholder orientation, conscious leadership, and conscious culture. Taking some liberties with expression, allow me to rephase these concepts.
- Conscious purpose: a greater purpose that just profit
- Conscious collaboration: operate from a stakeholder ecosystem
- Conscious leadership: focus on the “we” rather than the “me”
- Conscious culture: how we get things done
With some adjustment, one could correlate conscious business with a form of relationshipism. Based in social intelligence and the cognitive sciences, relationshipism is the theory of being relationship-centered in all aspects of your personal and organizational life. An interpretation of the relationshipism concept was introduced in 2019 by the BRM Institute to identify this value recognized by business relationship managers (BRMs).
Conscious capitalism emphasizes relationships over profit while acknowledging that capitalism works yet can be abused.
How we lead
Tomorrow’s success will be built on the decisions you make—and, more importantly, on the credo you establish for your team today. Before the daily grind washes away your curiosity and passion to effect change, reflect on how you’ll lead your team. Are you guiding with purpose, championing change with value, spearheading transformation with collaboration, or leading with relationships?