The most overused business phrase from 1995 through about 2005 was “increase shareholder value.” It appeared in more corporate mission statements, vision statements and annual reports than “be environmentally responsible” does today. The worst part wasn’t the monotony (litany?) of corporate speak during those years… it was that the strategy wasn’t really a strategy. It was a result.
The best companies didn’t focus on creating shareholder value. They focused on their customers, products, services… delivering what people wanted, in the way they wanted it, in exchange for fairly valued compensation. The right focus and smart execution drove success, which ultimately increased shareholder value. Regardless of its inclusion in any mission statement, I might add. Do you think employees can all rally around the idea of doing their very best so they can increase the value of stock owned by someone else? Or even their own stock, which generally is a tiny portion of their compensation or retirement? Doubtful. Employees rarely care about shareholders.
Today, companies are urged to be responsive, engaging, transparent and social. Employees tweet or manage facebook pages for themselves and for businesses. There are videos, photos, review sites… so many ways to share information. And the customers are out there… tweeting, facebooking, reviewing, too. The companies who are engaging, who are social, who are transparent (which is just to say, HONEST), build this army of fans or friends. When something negative is posted to the facebook wall, fans defend the brand. When a tweetstorm erupts over someone’s negative experience, the brand responds, the followers defend and retweet, and all is rosy and well in the social sphere. Until… a major crisis hits, and those fans want answers.
They have been trained through interaction to feel like part of the team. Fed a diet of transparency and access, they feel entitled to answers, honesty and truth in short (very short) order. And they are correct. Those fans you’ve been cultivating? They are your businesses’ social shareholders. They have an (emotional) stake in your company. They defend, but they also demand. Just like in the old days of increasing shareholder value, creating raving fans is still a result, not a strategy.
Serve the customers…. in the immortal words of Becky McCray at the recent Get Social conference in OKC, “Customer service is all you’ve got.” She didn’t mean just the basic idea of customer service (being nice, greeting them, sacking the groceries correctly, etc.); she meant truly serving them. Putting those customers first, in all ways. Then, right after you take care of those customers and create those loyal followers, friends and fans, go take care of your social shareholders. They deserve it, too.
My big takeaways from the conference?
The Context / Content stuff is going to come together for another post soon 🙂
What do you think? Do you believe in the idea of social shareholders?
Thanks to Blake Jackson… the inspiration for this post came from his opening discussion at Get Social.