Corporate planning: The missing piece

Anyone who has been in a top management role in a company will tell you that CSR is basically window-dressing and has no impact on a company achieving its objectives.

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Most companies are familiar with crafting their vision and mission while developing their corporate strategy. Many blue-chip Malaysian companies have a vision or mission statement but not all.

A quick search of several Malaysian Main Board companies shows that not all of them have displayed their vision and mission on their websites – the conclusion is, they simply don’t have a vision and mission.

Some have a vision without a mission and others have a mission without a vision. Some don’t have anything. In any case, the majority of the companies listed on Bursa Malaysia which have their vision or mission listed still have something missing.

If you were to search the websites of companies on the Global 500 that are globally marketing their products, you’ll notice that most of them have their vision, mission and values listed.

The missing ingredient in Malaysian companies is the values that govern them. Interestingly, many of the Malaysian Main Board-listed companies have a CSR (Corporate Social Responsibility) policy listed prominently. This is probably because Bursa Malaysia is driving companies to undertake CSR.

Anyone who has been in a top management role in a company will tell you that CSR is basically window-dressing and has no impact on a company achieving its objectives.

Often companies use CSR as a tax write-off. Been there, done that. Most customers don’t really care about your CSR activities. They only care about WIIFM – What’s In It For Me.

Bursa Malaysia believes that Malaysian companies should play a prominent role in social development. The late management mahaguru, Peter Drucker, says that every business is a social business because every business exists to fulfil some need in society.

Can you think of one that doesn’t?

So why do you need CSR? Isn’t every product or service a business creates provides some sort of service to society? Isn’t a restaurant doing social responsibility by feeding people? Isn’t a private clinic fulfilling its social responsibility in making sick people well?

From Drucker’s perspective a company’s social responsibility is to ensure that it makes useful, workable products and provides valuable service to society (customers).

The values of a company indicate to customers and other stakeholders what the company values. One airline lists one of its values as, “Safety First – partnering with the world’s most renowned maintenance providers and complying with the world airline operations.” Would you fly this airline or another, which doesn’t have any values but has been making losses for the last decade?

Wouldn’t you worry that they would cut corners to become profitable? In fact, they had a crash in East Malaysia and there were suggestions that vigorous cost-cutting or other procedures may have caused the crash.

The Proton example

The Vision, Mission and Values (VMV) are the foundations of a company’s future operations. They set the tone for how a company will manoeuvre the environment it operates in.

The values state what is significant for the company and its business intent. The values are the guide that all staff will use to make decisions on how they serve customers and interact among themselves and other stakeholders.

If we look at the company that most Malaysians love to hate, Proton, we see that it doesn’t have a VMV listed. Does it have a vision? Does it have a mission?

When you analyse its products and business performance, you will wonder what Proton’s intentions are. It is unsuccessful in all the markets it operate in. Its website lists its history and glorifies Dr Mahathir Mohamad. But who cares?

Nobody buys Proton cars based on its history. Without VMV, Proton is wandering aimlessly – one day thinking of tying up with VW and another day with GM or some Japanese company and buying motorcycle companies, and so on.

Proton probably meanders because it was not created for a business purpose but to fulfil political and personal egos. The question to ask is, will society suffer if Proton disappear? No. We have Perodua which already makes good, cheap cars and when the government slashes imported car duties, we will have cheaper, good quality cars.

Even among the Global 500, the companies without value statements are the ones which have perennial problems with their staff and/or the authorities and the public.

Getting the right person

The values statement becomes critical when a company deals with the public, So B2C (back to consumer) companies can’t have an excuse to ignore it. People like to deal with other people who are like them.

So your company values will resonate with like-minded people who will become your customers, suppliers or just simply your supporters.

These supporters or detractors could be NGOs, which are becoming powerful in moulding public opinion towards organisations.

In summary, a company needs a vision to tell others what it wants to become or aims to achieve in setting up its business. This is like “Starting with the End in Mind”, as Stephen Covey said.

Secondly, the mission tells the world what a company will do to achieve its vision. Finally, the values proclaim what its beliefs and guiding principles are. Creating an effective VMV is the first step to marketing your company’s reputation.

However, there’s a caveat to this. An awesome VMV can only be developed by the right people. And it’s having the right people who will drive your company to being world-class.

Looks like we’re back to the topic of the right person. Next week, I shall outline how to actually get the right person. It’s not rocket science but there’s still a science behind it.

James Pereira is a Reputation Marketing and Organisational Development Coach Consultant. He has spent more than 20 years in multinational companies in the areas of marketing, sales and organisational development. He was also the Deputy Dean of the Post Graduate School at a local university.