Apply the six thinking hats to this readings
- If the first letter of your last name isK-N, make your initial posting about your case from the perspective of theblack hat.
untitled See discussions, stats, and author profiles for this publication at: https://www.researchgate.net/publication/242424545 The High Impact of Collaborative Social Article in MIT Sloan Management Review · March 2005 CITATIONS 162 READS 3,407 2 authors: Some of the authors of this publication are also working on these related projects: Entrepreneurship Research View project An Assessment of the Role of Latin America in the Core International Business Literature View project John A Pearce Villanova University 134 PUBLICATIONS 9,428 CITATIONS SEE PROFILE Jonathan P. Doh Villanova University 167 PUBLICATIONS 7,687 CITATIONS SEE PROFILE All content following this page was uploaded by John A Pearce on 02 June 2014. 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Pearce II and Jonathan P. Doh Please note that gray areas reflect artwork that has been intentionally removed. The substantive content of the article appears as originally published. SUBSCRIBER COPY - NOT FOR REPRODUCTION - SUBSCRIBER COPY - NOT FOR REPRODUCTION - SUBSCRIBER COPY - NOT FOR REPRODUCTION - SUBSCRIBER COPY - NOT FOR REPRODUCTION - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - 30 MIT SLOAN MANAGEMENT REVIEW SPRING 2005 n 1999, William Ford Jr. angered Ford Motor Co. executives and investors when he wrote that “there are very real conflicts between Ford’s current business practices, consumer choices and emerging views of (environ- mental) sustainability.” In his company citizenship report, the grandson of Henry Ford, then the automaker’s nonexecutive chairman, even appeared to endorse a Sierra Club statement declaring that “the gas-guzzling SUV is a rolling monument to environmental destruction.” Bill Ford has had to moderate his strongest environmental beliefs since assuming the company’s CEO position in October 2001, just after the Firestone tire scandal. Nevertheless, while he has strived to improve Ford’s financial performance and restore trust among its diverse stakeholders, he remains strongly committed to cor- porate responsibility and environmental protection. In his words, “A good company delivers excellent products and services, and a great company does all that and strives to make the world a better place.”1 Today, Ford is a leader in producing vehicles that run on alternative sources of fuel, and it is performing as well as any of its major North American rivals, all of whom are involved in intense global competition. The new CEO is successfully pur- suing a strategy that is producing improved financial performance, increased confi- dence in the brand and clear evidence that the car company is committed to contributing more broadly to society. Among Ford’s more notable outreach efforts are an innovative HIV/AIDS initiative in South Africa, which is now expanding to India, China and Thailand;2 a partnership with the U.S. National Parks Foundation to provide environmentally friendly transportation for park visitors;3 and significant support for the Clean Air Initiative for Asian Cities.4 Ford’s actions are emblematic of the corporate social responsibility (CSR) initia- tives of many leading companies today. Corporate-supported social initiatives are now a given. For some time now, many Fortune 500 corporations have been creating senior management positions dedicated to helping their organizations “give back” more effectively. CSR is now almost universally embraced by top managers as an inte- gral component of their executive roles, whether motivated by self-interest, altruism, strategic advantage or political gain.5 Their outreach is usually plain to see on the companies’ corporate Web sites. Corporate social responsibility is high on the agenda at major executive gatherings such as the World Economic Forum. It is very much in evidence during times of tragedy — as seen in the corporate responses to the Asian tsunami of last December — and it is the subject of many conferences, workshops and newsletters. “Consultancies have sprung up to advise companies on how to do corporate social responsibility and how to John A. Pearce II is a professor of strategic management and entrepreneurship at the College of Commerce and Finance, Villanova University, and is director of the college’s Entrepreneurship Research Center. Jonathan P. Doh is an assistant professor of management and director of the Center for Responsible Leadership and Governance, College of Commerce and Finance, Vil- lanova University. Contact them at
[email protected] and
[email protected]. The High Impact of Collabor Corporate social respon- sibility has become a vital part of the business conversation. Research points to five principles that underscore how collaboration provides the best combination of social and strategic payoffs. John A. Pearce II and Jonathan P. Doh I SUBSCRIBER COPY - NOT FOR REPRODUCTION - SUBSCRIBER COPY - NOT FOR REPRODUCTION - SUBSCRIBER COPY - NOT FOR REPRODUCTION - SUBSCRIBER COPY - NOT FOR REPRODUCTION - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - ative Social Initiatives let it be known that they are doing it,” noted The Economist in a survey on corporate social responsibility earlier this year.6 Executives face conflicting pressures to contribute to social responsibility, while honoring their duties to maximize share- holder value. These days they face many belligerent critics who challenge the idea of a single-minded focus on profits — witness the often violent antiglobalization protests in recent years. They also face skeptics who contend that corporate social responsibil- ity initiatives are chiefly a convenient marketing gloss. It is not the intent of this article to question the appropriateness of exec- utives’ CSR activities or to judge their sincerity. Rather, we start from the assumption that many organizations are eager to improve their CSR effectiveness. The issue is not whether companies will engage in socially responsible activities, but how they should do so. For most companies, the central challenge is how best to achieve the max- imum social benefit from a limited amount of resources avail- able for social projects.7 In our studies of dozens of social responsibility initiatives at major corporations, we have found that senior managers strug- gle to find the right balance between “low engagement” solu- tions such as charitable gift giving and “high commitment” solutions that run the risk of diverting attention from the com- pany’s core mission. (See “About the Research,” p. 32.) In this article, we discuss the findings of our research that show how collaborative social initiatives (CSIs) — a form of engagement in which companies provide ongoing and sustained commit- ments to a social project or issue — provide the best combina- tion of social and strategic impact for companies. The Core of the Corporate Social Responsibility Debate The proper role of corporate social responsibility — the actions of a company to benefit society beyond the requirements of the law and the direct interests of shareholders — has generated a century’s worth of philosophically and economically intriguing debates.8 Since steel baron Andrew Carnegie published The Gospel of Wealth in 1889, the argument that businesses are the trustees of societal property that should be managed for the pub- lic good has been seen as one end of a continuum, while at the other end is the belief that profit maximization is management’s only legitimate goal. The CSR debate had been largely confined to the background for most of the 20th century, making the news after a major event such as an oil spill, when a consumer product caused harm or when an ethics scandal reopened the question of business’s fundamental purpose. The debate surfaced in more positive ways in the last 30 years as new businesses set up shop with altruism very much in mind and on display. Firms such as ice-cream maker Ben & Jerry’s Home- made Holdings Inc. argued that CSR and profits do not clash; their stance was that doing good led to making good money too. That line of thinking has gained popularity as more executives have come to understand the value of their companies’ reputations with SPRING 2005 MIT SLOAN MANAGEMENT REVIEW 31 SUBSCRIBER COPY - NOT FOR REPRODUCTION - SUBSCRIBER COPY - NOT FOR REPRODUCTION - SUBSCRIBER COPY - NOT FOR REPRODUCTION - SUBSCRIBER COPY - NOT FOR REPRODUCTION - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - S U B S C R IB E R C O P Y - N O T F O R R E P R O D U C T IO N - S U B S C R IB E R C O P Y - N O T F O R R E P R O