Creating a Winning Cause – Business culture as a source of competitive advantage

Notes from the UK /E.U. Office of Fletcher CSI. 

On Friday 31st January 2020, the UK withdrew from its membership of the European Union. This has been a momentous time in the history of Great Britain and Northern Ireland. The very fabric of the four nations that constitute the UK has never been more scrutinized, tested or challenged, since its creation in 1707.

At times of major decisions, most decision makers would seek real evidence and insight in order to support their judgement and decision options. However, we do not live in normal times. In the context of the December 2019 election, the evidence that was offered to support the competing manifestos was questionable at best or designed to be purposefully misleading. With the propaganda machine in full swing for the preceding weeks and months, voters on both sides felt increasingly conflicted. Historic allegiances were ripped apart and deep values held by generations of voters are now a distant memory. 

The challenge of Brexit means that the United Kingdom now finds itself under the very real threat of dissolution. The majority of voters in Scotland are keen to remain part of the European Union. Whichever side of the debate, Brexit, to many in the UK, became a cause. A cause that millions of voters became passionate about on both sides of the argument.  

Fletcher/CSI encourages and advises leaders to monitor their external environment, as well as study their rivals, in order to drive better decisions, create competitive agility and business foresight. Political leaders in the UK have been especially economical with the truth over the last few years. They have been determined to hide critical documents from their electorate, their “customers”. Trust has dropped to an all-time low. The UK now stands 19th – one above Russia – in the 20th Annual Trust Barometer. The very cause that was created, in this case Brexit, was based on a “mistruth”. The cause therefore was not authentic. This has created misalignment and serious division between England, Wales, Scotland and Northern Ireland. The political future of the Union looks to be in doubt.

Successful leaders – be it in business, politics or sport, should aim to create an authentic cause. Their vision often starts with a mission to disrupt an industry, to be different, working harder to carve a market niche and compete. Successful companies strive to be resilient and create a bond of trust between their cause and their customer base. Happy customers often become the source of new and yet more customers. 

In the commercial world, customer experience derives from the cultural values that a company creates. Values are created at the top by leaders who use them to communicate their cause, direction, and reasons to engage. They aim to build a company and culture that gives people a sense of purpose beyond product, to pursue sensible SMART values-based goals. With a superior culture, a sense of deep trust can be created and shared through all levels of an organization’s ecosystem (leadership teams, staff, investors, supply chain, and customers). Some leaders create “a calling” or a sense of “family.”

A positive culture within any organization (political or commercial) should be embraced as a source of competitive advantage. Today, our politicians will do almost anything to win or retain power. CEOs seek ways to grow their businesses in a ruthlessly competitive market environment. As mistrust in politics and the democratic process rise, so too in business, making brand and the customer experience paramount to building long term competitive advantage. 

Some organizations are making great efforts to improve by planting seeds of change. Working within intensely competitive environments, big pharmaceutical companies have recognized that their protected time with serious competitive advantage, based solely on the science of a single drug, is becoming more and more compressed. Recruitment, people retention, talent management and business culture can and should become a serious source of long term competitive advantage. 

At the other end of the business spectrum, car dealerships seek to create additional value. They now offer to send a video recording with technical commentary of the service visits. A courtesy car, or a taxi, is offered “free of charge” to the nearest railway station. In the UK, a well-known supermarket chain now proactively encourages their staff to randomly give products away free of charge in order to create goodwill and rapport. A local retail chain now offers to book local exercise classes for their customers. 

Hotel chains are reinventing themselves based on a new type of competitive environment. They no longer discourage non-residents from using their foyer for meetings – some now seem to positively embrace this trend. Many hotels provide free WiFi with dedicated workspaces, supported by refreshments, free newspapers and an office bureau. When complimented about this material change an employee recently stated, “we love having you here!” How many employees “love” serving their customers? It is the experience that is remembered. “We can train on many things” reported his supervisor – “but in the first instance we cannot train staff to be nice people. We seek to recruit nice people”. This hotel chain recognizes that one of their key points of differentiation is the quality, caliber and authenticity of their customer facing staff. It is not simply the location of the hotel, the décor, the size of the rooms nor the mini bar. These are fixed investments.  It is the soft, more human related variables, that make the biggest difference to the customer experience.

Wherever a customer encounters a specific problem, a retailer has the opportunity to add further value. An opportunity to excel and build rapport. Goodwill becomes inherently aligned with brand building. It is not coincidence that goodwill is recognized as an important component within the valuation of an organization. These companies are identifying real influencers as change makers. They support or amplify the steps and create new retail concepts in order to be better aligned to their customers’ needs. 

Political leaders and CEO’s are transient. However, for an organization to succeed from one generation of leaders to another requires constant renewal, innovation and respect for values-based decision making. Organizations seeking to grow or at least optimize the levels of their competitiveness would do well to welcome challenge from the viewpoint of their customers and experienced stakeholders. They need to encourage open and honest feedback from customers and staff alike, with less deference to hierarchy. 

Those seeking to create, improve and measure a better culture in order to gain competitive advantage must invest in the “soft stuff”. Starting with evaluating the values of a company in order to ensure that from the top down those values are at the center of every decision the company makes. Customers expect long term value and seek to engage with a brand that best reflects their own values, interests and needs. Customers evaluate not only the quality of brand but also the wider experience that is created.

Our new political leadership negotiated an 11-month transition period in order to create new trade deals with their “competitors” throughout the world. No-one has 20/20 foresight, but during the next phase of negotiations, some serious and conflicting challenges will appear. One Chancellor of the Exchequer has already resigned since the UK’s departure from the E.U.

Successful CEO’s aim to create a cause and gain an understanding of their competitors’ future intent. Similarly, politicians who have won a serious mandate from their electorate, need to respect the culture and wishes of the differing countries around the world, knowing when to create the conditions for competitive trading and knowing when to enable and support collaboration.

Brexit, once considered the pipe dream of a small minority of our electorate, could still confound millions of skeptics and become a winning cause. The challenge for business leaders is to gain strategic foresight and execute their strategy in a coherent way. They can start to do this by monitoring their external environment, identify the associated risks and blind-spots as well as innovate and capitalize upon new opportunities. This is their new challenge, their cause. The culture they create within their organisation could become the difference between winning and losing and indeed the very source of sustained competitive advantage. 

Author: Gordon Donkin, Director of UK & E.U Operations Fletcher/CSI