I predict a business best seller for a book that’s being released this month: Firms of Endearment: How World-Class Companies Profit from Passion and Purpose. It’s about how successful companies focus on ALL their stakeholders, not just shareholders. [2014 Update: This book is now in its second edition.]
Given my internal marketing bias, I’m thrilled with any book that encourages companies to pay more attention to their employees. But Firms of Endearment goes even further as it advocates appropriate attention to all of a firm’s stakeholders: its customers, employees, partners/suppliers, investors, and the community-at-large/society. I also love the examples of how these companies do this profitably in spite of Wall Street’s short-term focus.
The research process used to identify “Firms of Endearment” (FoE) was opposite of the Good to Great approach. Instead of starting with financial performance and working backwards to find common corporate practices as with “Good to Great” companies, FoE authors began by identifying companies that people love. These companies were then screened for their performance in serving each stakeholder constituency, followed by an investor analysis on the publicly-traded companies.
The book explores the answer to the question:
“How is it that these companies can be so generous to everyone who costs them money (customers, employees, suppliers, communities) and still deliver superior (some would say spectacular) returns to investors?”
I’m adding the book to my “recommended reading” list that I handout in my training workshops and, of course, my “Good Reads” blog roll.