Sarah Kaplan

"Stakeholder capitalism" might now be part of the prevailing corporate dialogue, but few actually understand how to put this idea into action. Kaplan's distills her research (primarily with Nike and Walmart) and work in the classroom into 4 operating modes, which represent the various ways that companies can balance stakeholder tradeoffs.

She points out that most companies are stuck in Mode 2: looking for "win-win" solutions and focused on the idea of creating shared value. So what's the problem? As she states clearly, "In this approach, corporate priorities still dictate which social issues are worth addressing. The more we expect firms to take on these responsibilities, especially to the extent that company strategies become substitutes for government regulation, the more we relinquish social policy to the corporate bottom line."

She pushes us to go beyond the win-win and instead to innovate around the tradeoffs (Mode 3) or to hold them in tension, as a motivation to achieve even more ambitious goals in the long run (Mode 4). To achieve these higher modes, there might be short-term sacrifices and changes to your business model. But without Nike's commitment to overhauling of its problematic manufacturing system, they never would have come up with their innovative shoe designs that use 3-D printing instead of toxic glues. If Walmart hadn't set a target to add 20 billion of products and services from female-owned businesses, they would not have discovered new training and sourcing techniques.

From my perspective, Kaplan is not entirely disregarding the win-win, but instead asking us to think on a longer time horizon: if this action is what is needed to address some injustice or harmful inertia, how can we prioritize it, even if it means a short-term "loss." Of course, this is much easier said than done, and most of her focus is on large corporations with significant capacity and financial stability. Still, it's an inspiring perspective that might help you as a business leader to push back on some of the incremental thinking, and instead be bolder in search of creative solutions.… (altro)