Wednesday, June 10, 2015

Longevity Factor #5: Active Community Members

Because the old companies see themselves as an integral part of a web of relationships often connected to their family history and reputation, the development of relationships within the local community – both commercial and social – are seen as just as important as the development of relationships with their business transaction partners. The old companies are active participants in their local communities, promoting the community and developing local networks for mutual learning and benefit. In many cases a company and their local community are so closely associated with each other that they are seen as one and the same.

Old companies score significantly higher than young firms on every question relating to building relationships within their communities. Whether it was participating in business organizations (such as the Chamber of Commerce), building personal connections with people in other industries, or being involved in projects to promote their local community, the older firms are significant, active members of their communities. The old companies believe the connections they build with local people in other industries at all levels of management have a positive influence on the reputation of their firm. They also believe there is a positive influence on their business that comes from the local community’s good reputation.

As a result of recognizing the value provided by the society beyond their individual business or industry, the old companies invest time and resources in projects that develop and sustain their communities. And when a crisis hits their community, the old companies are there to help. And this community support works both ways, with the community stepping in to help out a business when disaster hits, such as with 150-year-old, sixth-generation Brietbach’s Country Dining in Balltown, Iowa, which was struck by fire and completely destroyed twice within 18 months. In this case, it was the community that helped rescue the business. (You can see more of this remarkable story in the film Spinning Plates.)

Often when I talk about social responsibility with my students, they think just in terms of philanthropy, or monetary donations to non-profit organizations, and they ask how small or start-up companies can do this when they are still struggling to make money to keep the business operating. The community relationship practices engaged in by the old companies are great examples of how social responsibility and community service can be more than just financial donations to the United Way (although when able, the old companies are philanthropic as well). Often these practices take the form of supporting employees’ volunteer efforts.

Other companies have “donated” their employees to non-profits during slow times in the business cycle, thus keeping valued people on their payroll for when business turns up again while also contributing to their community. It would be difficult to overstate the loyalty and dedication to a company that these practices build in employees who see themselves helping out their community.