How To Create a Successful Distribution Business
The Importance of Corporate Culture
Virtues and Values
The ancient philosopher Aristotle understood a thing or two about how to achieve success. According to his writings, a good and satisfying life was one that navigated a course between the extremes of hedonism and deficiency. And the way to do this, he asserted, was by living in accordance with our ‘virtues’ — those qualities and behaviors that we all, universally recognize as good, and which in his view, were best nurtured by experience and daily practice rather than prescriptive rules.
Virtue Theory
Fast forward more than two thousand years and ‘virtue theory’ is enjoying something of a well-deserved renaissance, most notably through the positive psychology movement and the writings of Martin Seligman. Its relevance to business is gaining traction too, and justifiably so, because the virtue theory adds a layer to our understanding of that other ‘V’ word, V for values, which has evolved into a ubiquitous concept in the progressive workplace.
There are few organizations today that would fail to acknowledge the importance of values. The idea that an engaged workforce, aligned to the goals of the company and working with common principles, helps to drive performance, is not only common sense, it is backed by a raft of evidence which crosses sectors, cultures and continents. Whether formalized or not, the best performing organizations across the globe have strong value sets which underpin their culture and provide a sense of meaning and belonging to their people.
But if the awareness of values is now commonplace, the concept of virtues remains somewhat academic, even though its benefits are just as transformational and equally self-evident.
What are corporate virtues?
By virtues, we mean those personal qualities that all of us recognize as beneficial to ourselves, to others and the community at large. In his work on positive psychology, Seligman identifies several high-level categories such as courage, wisdom, humanity and justice. Beneath these are more tangible qualities such as creativity, diligence, fairness and teamwork. In all, he lists 24 strengths that are universally recognized as positive attributes and which contribute to a collective good. While each of us has a preference and greater capacity for some virtues over others, all of us are happiest and most satisfied when we are able to employ these positive characteristics in our day to day lives. It’s not necessary to dig deep into philosophy or psychology to take some lessons from this. For leaders and professionals, the critical point is that we all give of our best and make our greatest contribution when then the work we do supports our positive motivations.
What does it virtues or strength mean for a company?
Consequently, if we can align roles and responsibilities across our organizations — and provide opportunities that nurture the virtues — then both our colleagues and our businesses are more likely to flourish. Having clear values helps us to establish the rules and guidelines for common behaviors; promoting virtues goes a level deeper, encouraging our individual strengths for the collective good.
I like to think of living by our virtues as the difference between ‘being in a rut’, and ‘ploughing one’s own furrow’. In the former, we are trapped in a cycle of activity that feels meaningless and lacks personal satisfaction — even if the organization and its goals are worthy, we as individuals don’t fit, because the role we are asked to play doesn’t have room for those qualities that motivate and self-propel us. By contrast, in following a path which plays well to our individual strengths, we give and achieve more, thereby benefiting ourselves and our wider community. To use a sporting analogy: how often, do we hear soccer coaches talking of the need to give creative players ‘the freedom to express themselves’ — in a sense, that is virtue theory in action.
In a workplace setting, promoting virtues can be as simple as allowing a few hours a week for more lateral thinking (creativity and curiosity), or offering the opportunity for development training (love of learning); it might mean shaping a job to include more group activities (teamwork) or allowing colleagues to self-organize charitable activities (social awareness, kindness). In truth, much of this, good leaders do instinctively, encouraging something similar in wider organizational goals. Though they might not use the term ‘virtue theory’, many of its key elements are inherent to contemporary thinking on issues such as diversity and inclusion: valuing differences and allowing us all to give the best of ourselves.
Corporate Virtues are not just for Employees
There’s relevance in virtue theory for our corporate strategies too. In the courting stage, contemplated acquisitions and mergers almost invariably sweeten the numbers, estimating the potential for synergies, market share, pricing power and the other benefits. And yet so much of this M&A activity ultimately fails to deliver the intended results. By applying the lens of virtue theory, we might consider more carefully whether the acquirer will be a good parent or partner — are its organizational virtues compatible or in conflict with those of its target?
Virtues for Ourselves
And finally, as individuals navigating our career paths, the idea of living in harmony with our strengths and preferences is an invaluable perspective when viewing our situation and prospects. Seligman describes the pursuit of virtues as the ‘gold standard of human well-being’ — the root of the positive choices we make in our efforts to flourish. At times, that may involve difficult choices — and I recognize that the freedom to act varies by circumstance — but across a career or a lifetime, finding your niche, feeling energized and ready for the day, undeniably is worth some sacrifice. For as Aristotle claimed many centuries ago, there is no one prescription for success, but being true to our positive natures is the surest route to follow.
6 Organizational Behaviors Essential for Corporate Culture
Corporate culture… should ideally also extend to the development of a collective perspective on societal and environmental considerations, for instance, the role of the organization in the broader community, or the efforts to minimize a corporation’s carbon footprint.
Whether you have taken the bold decision to start your own business or have been tasked with running an existing company, the asset you are managing may well have multiple areas that deserve your special attention. For example, your business may be lacking organic growth, its leadership team may need to be recruited or upgraded, and the organization may require a couple of tangible successes to reinvigorate the team.
Business Transformation Requires a 4 Step Plan
Transforming a business from its current state to a desired future state demands not only passion but also disciplined planning. This requires:
- a concise, well-articulated strategic plan,
- a description of the benefits of the desired future state to the associates, as well as to the long-term future of the company,
- the reassurance that the associates, collectively and individually, are mission critical to the success of the company, and
- a clear glide path to the end goal, with key milestones and a rigid project management approach.
In addition, any transformational activity is largely facilitated by a shared corporate culture. According to Jozef Opdeweegh, a Miami businessman with over 17 years of experience as CEO, Chairman, and Board Member of private and public companies, “Corporate culture plays a critical role in the success of a company. The value and impact of a set of shared beliefs and behaviors can hardly be overstated when convincing a group of people to meticulously undertake a challenging change initiative.”
Corporate Culture Definition
Opdeweegh uses a definition of corporate culture based on a commonly shared notion that a company’s culture consists of the sum of beliefs and behaviors that determine how associates and management interact with each other inside and outside the workplace, as well as with other relevant constituencies, such as customers, suppliers, the board of directors, lenders and other outside parties. Notes Opdeweegh, “Corporate culture, however, should ideally also extend to the development of a collective perspective on societal and environmental considerations, for instance, the role of the organization in the broader community, or the efforts to minimize a corporation’s carbon footprint.”
Opdeweegh adds that when suggesting a set of core values to the organization, it is important to come forward with values that are highly relevant to the corporation and its success, yet are universal in nature, and impossible to contest. Says Opdeweegh, “Nobody will object to a core value of ‘fairness.’ Nobody will raise their hand to state that they do not believe in ‘creativity.'” He notes that the process of agreeing on the most relevant core values or behaviors for an organization is an iterative and democratic process, with the ultimate end-result coming from many group sessions with a relevant diagonal slice of the company’s associates.
6 Core Behaviors of Corporate Culture
Opdeweegh cites 6 core behaviors that are very powerful in driving the right strategic initiatives of the organization. He encourages using one or more of these for discussion purposes as you go through the collaborative process of defining your corporate culture.
Creativity: “Think outside the box and share your perspective.”
Customer centricity: “The customer is central to everything we do.”
Empowerment and accountability: “Push decision making down in the organization and hold people accountable.”
Fairness: “Be fair and respectful in everything you do.”
Openness: “Be open and open-minded, listen and allow the best idea to win.”
Speed: “Make quick, analytics-based decisions.”
About Jozef:
Jozef Opdeweegh, also known as Jos, has served as CEO for over 17 years of global technology, distribution, and supply chain optimization companies with 5,000 to 20,000 employees, public or privately held. Opdeweegh has extensive board membership experience on 4 continents with related and unrelated companies.
Twenty Twenty Vision
Has it really been twenty years since we were celebrating a new Millennium? Depending on your perspective, that milestone might seem like yesterday or an age away — given the pace of change, it can feel like both. Across societies worldwide there’s a cultural tradition of acknowledging significant anniversaries and using these as a time to reflect on the past and set new goals. And so, as we enter the third decade of the century, it’s perhaps an appropriate moment to consider the road we’ve travelled and the forces and challenges that are likely to lie ahead.
From a leadership perspective, looking back on the last twenty years, the landscape is in many respects still recognizable — the basics of balanced analytical judgement, good people skills, team building and empowerment are little different, if probably more nuanced. But the changes wrought by technology, increasing globalization, public sentiment and the sheer improvements to our understanding of how we best work together — have inexorably transformed the way organizations navigate their routes to success.
My chief interest lies in the impact these developments — and many others — will have on the demands of senior leadership in the decade ahead. Of course, cultural trends don’t fit neatly into ten-year cycles, but for the sake of convenience — and with a heavy caveat that ‘futurology’ is out of date the moment it’s voiced- here are my thoughts on some the issues that may most significantly impact the leadership agenda over the next ten years.
Organizational Purpose
The idea of organizational purpose has been gaining ground for some time. It’s understood that businesses must make a profit to survive, but beyond this there lies an increasingly powerful sentiment that organizations need to play a clearer and more positive role, not only for their direct stakeholders but also in wider society. The growing B Corp movement , which accredits businesses on social and environmental factors, has to date been seen as somewhat ‘alternative’ — but its core message, which envisions business as a force for good while campaigning for a more balanced assessment of positive impacts than profit alone, is increasingly influencing mainstream thinking. Evidence shows that organizations founded on strong social values have more engaged colleagues, attract talent at less cost and enjoy stronger customer relations and brand reputations. Leadership in the next decade will require greater attention to these issues, not as a requisite of political correctness, but as a means to drive performance.
Organizational Sustainability
No organization of size can ignore sustainability in the coming decade. From an environmental perspective, the pressures are literally rapidly warming up — and with them a need for greater vision and bolder solutions. Pressure groups demanding targets that would appear, by conventional standards, to be unachievable and unrealistic, are nonetheless impacting public sentiment and with that shaping the policy and legislative agendas. The challenge for many leaders will be that adopting a ‘road to Damascus’ eco-conversion will be as impractical as continuing to ignore the underlying realities. My expectation is that a combination of technological solutions and ever more stringent legislation (particularly to ensure level playing fields) will help — but, regardless of the detail, it is clear that we will require leaders to step up with urgency and place these issues at the center of our planning.
Organizational Transparency
The last two decades have seen an unprecedented increase in the scope of corporate reporting. Financial performance, though remaining pre-eminent, is now only one among many of the measures that organizations must account for: gender diversity, pay ratios, executive incentives, environmental emissions, health & safety… This wider assessment of organizational competence will only increase, as will the transparency of data comparison between organizations.
To some extent, what we have seen is a shift to ‘compliance reporting’, by which organizations have sought to meet the formal requirements but then limited further comment. I sense is that we will see the pendulum swing the other way, with a greater demand for leaders to provide more detailed narratives that are answerable to (and tested by) the ever-increasing transparency of the data. Accountability and transparency go hand in hand, so we should expect leaders to be more answerable to their stakeholders than ever before.
Organizational Collectivity
One thing that isn’t going to happen is life becoming simpler. Complexity will necessarily increase as a consequence of the challenges above, and it’s as true as ever that ‘ what got us to here, will not take us to where we need to go’. In this environment, leadership that’s focused on a single individual, however charismatic or talented, will not be sufficient — and even a united senior team is unlikely to deliver the transformational change that some organizations will require. The most successful companies already devolve decision making, but simply segmenting responsibility (by, for example, allocating Values to HR or Efficiencies to Operations) will also not be enough. As complexity increases the role of leadership must shift even further from a focus on decision making and control, to that of engendering a collective ownership of direction and priorities. In short, leadership will increasingly be about demonstrably living the organization’s collective values and goals as much as setting them.
Organizational Courage
The average lifespan of a business is shortening — it’s currently somewhere around 10 years — and most of those long-standing companies that continue to thrive do so by continual adaptation if not entire reinvention. We all know that the last decade has hit the retail sector particularly hard but arguably greater and more fundamental challenges lie ahead for others — consider the challenges facing the leaders in say, heavy engineering, hi-tech manufacturing, distribution, combustible engine manufacturing…
For many businesses — be they start-ups or global giants — the next decade is likely to involve some truly critical calls. Leaders will need to listen, to delegate, to set goals — all that we have considered so far — but they must also have courage, since many of the key decisions will require acting on beliefs in the absence of certainty. The word courage has its origins in the old French and Latin words for ‘heart’ or ‘seat of our feelings’ — and in that sense, it is subtly different to bravery or resolve. These qualities will be helpful too, for boldness and determination are how we must put our beliefs into practice, and acting together, they will be as fundamental to success as any analysis or epiphany.
Zest
I was tempted to title this last section ‘fun’, for enjoyment in the task is surely essential in any leader, whatever their era. But in zest I am hinting at something more. For if we bring energy and enthusiasm to the mix — ideally in a manner that’s infectious to others — then what’s daunting becomes exciting; what seems an obstacle becomes an opportunity — and thereby all the more achievable.
Leaders must not fear the challenges of the next ten years — rather, they should see them as a golden chance: unique, inspiring and seminal to our futures. Leadership in this context is a privilege and remembering as much, every time we turn up for our colleagues or ourselves, is a challenge we should all look forward too.
Happy new year — and here’s to a Roaring Twenties!