This example of a small business (and I'm sure there are many others) suggests what may be a novel way of measuring business success. Although there is no single measure, the main measures of success so far has been profits, which is often expanded to profitability and market share. But these measures still reflect a shareholders' perspective, not one of society as a whole. But this example of a what is known as "societal orientation" in marketing, or a community-friendly business model, seems to be of interest as a possible starting point for developing such a measure.
A new buzzword doing the rounds in economics and the social sciences generally is 'social capital', referring to community ties, networks, norms, trust, and public goods of various kinds. Although the World Bank discusses social capital in the context of poor countries and development, it is essential for all societies.
Large scale destruction of social capital leads to large scale disasters, some very visible, others much less so. Given that there is plenty of evidence that many large businesses destroy publicly available social capital while promoting the private appropriation of financial, physical and even intellectual capital (possibly a new meaning to the term 'creative destruction', used by Schumpeter to refer to a well-known duality of capitalism), it would seem that megabusinesses often tend to destroy the social, cultural, moral and institutional infrastructure that is necessary for them to function properly. It therefore makes sense to research business models that create net social capital as a measure of their success. It's true that some corporations claim to do this on the side as a demonstration of their ethical stance and corporate responsibillity. But I don't think this defines the limits of what's possible by way of ethical business.
In a society which places so much value on scientific, technological and artistic creativity and innovation, there seems a marked reluctance to even discuss social innovation of this kind, for reasons which aren't far to seek. So one's moral sensibilities are rarely allowed to influence one's practical imagination and creativity. There are exceptions like Anita Roddick and EF Schumacher. But the kinds of businesses described in this article may well be the harbingers of a new kind of post-capitalist society. If I had the time and the leisure and the resources, this is one of the things that I would research. Even in a B-school!
It's quite possible, by the way, that some of the most trenchant critics of present-day capitalism and its most pragmatic but idealistic reformers are hidden away among the faculties of business schools. But I wouldn't bet on it!
Comments