As long as the bottom line looks good, it doesn’t matter how your business got there. The end justifies the means, right? Wrong! The book Firms of Endearment argues the exact opposite. It shows how companies with a greater mission than simply earning money are thriving today and will continue to do so in the years to come.
In my continuing series of book reviews, I take a look at a great book from Wharton School Publishing. Firms of Endearment is built on the premise that, because individuals are experiencing greater quantities of wealth and a plethora of goods and services, they are naturally seeking a higher meaning in their lives. Similarly, companies also need to adopt this idea of having a more meaningful purpose than simply increasing the bottom line.
The authors refer to the companies with greater purposes as “Firms of Endearment (FoEs).” The mission of FoEs build relationships with all of their stakeholders and not simply their owners. They classify 5 key stakeholders:
Society – Local and broader community…
Partners – Suppliers…
Investors – Individuals, lenders…
Customers – Past, current and future.
Employees – Past, current and future (including families).
Thirty FoEs were identified and studied to help determine how and why they are successful. Some call what they do “corporate social responsibility,” but they would call it smart business. The authors, however, use the word “concinnity,” the definition of which is “a skillful blending of the parts achieving an elegant harmony.”
This concinnity is a result of the FoEs’ leadership of love. The leaders themselves are passionate about their fellow beings, inspire others to join them in making the world a better place, and are driven by integrity. Leaders who focus on themselves and the bottom line are not true leaders. They may be in a position of leadership, but they are leaders in name only.
It’s not just share of wallet anymore; it’s share of heart. The authors believe it is changing the very soul of capitalism.
This supports what I see often with my clients, that companies have the ability to do good while still doing well!