In the seminal, if dated, 1999 HBR article “Unbundling the Corporation”, Hagel and Singer declared that every company contains three different kinds of business and that in future they would unbundle. nice work for consultants if you can get it (which is probably why it’s free at McKinseys site lol) … followed only 5yrs later no doubt by them “Rebundling the Corporation” 😀
This is a nice way in (well I think so lol) to framing things in a different take. Using the first three steps in the BizDev Cascade – Value, Marketing, Sales – we can “Unbundle the Corporation” in a different way.
Starting with Marketing-driven business, I would say that the sans pareil definition of most Global American Mega Cos in the food industry – is that Marketing has become the product. When you drink Coca-Cola you are drinking a brand not benefitting from a dozen teaspoons of sugar and some chemicals. “You are what you eat”. So what will you become if you eat McDonald’s? Whilst these businesses ride high, propelled by nigh on a Century of deep research into manipulating people’s minds I can’t see them lasting this century. Indeed they could well be “the 21stC tobacco” given various leaks of internal research of various such companies internal research showing that their products do injure people’s health (and the global obesity/diabetes epidemic is no laughing matter). For the moment they are protected by their deep lobbying tentacles into government. But so was tobacco.
Marketing per se is a necessary part of every business – you need “a message” and you have to get it out to your potential buyers. Of course. However the shadow-side arises when Marketing grows and grows in importance and Value/Product diminishes in importance … to these in extremis cases where the product is bad for your customers! All you are then left with is dysfunctional manipulation of the masses. Hello Vader, goodbye Luke!
Anyway moving on from the military-industrial (-drug-food-banking-etc) complex – which after all was a phrase coined by Eisenhower – who as a 5* General, Supreme Allied Commander and President was more qualified to speak than anyone. Do you really want to be in a marketing-driven business where image is everything? Well I guess you could always try politics 🙂
But where does the 21stC fit in. Well one angle is that the 21stC – and – may well be more about the purpose driven economy. This certainly seems to be borne-out for example at one end by young entrants into the job market (eg Forbes article on Millenials wanting Purpose Jobs) and at the other by the Pope who calls for a Purpose Economy.
From a nice write-up by Aaron Hurst (who has himself written a book called the Purpose Economy – hey I don’t just throw this stuff together dudes (cough)), a snip of Pope Francis’ comments:
We have created new idols. The worship of the ancient golden calf … has returned in a new and ruthless guise in the idolatry of money and the dictatorship of an impersonal economy lacking a truly human purpose…
At the same time we have to remember that the majority of our contemporaries are barely living from day-to-day, with dire consequences. A number of diseases are spreading. The hearts of many people are gripped by fear and desperation, even in the so-called rich countries. The joy of living frequently fades, lack of respect for others and violence are on the rise, and inequality is increasingly evident. It is a struggle to live and, often, to live with precious little dignity.
Certainly sounds like a day at The Tao of BizDev Towers 🙂
Before we all decide to go off and do something useful like helping Bill Gates eradicate malaria we need to be a little careful about not over-egging the Purpose word. Not getting too precious about it. After all we live in an immensely complex society. It has been famously said that there is not one person on earth than could, for example, make a computer mouse. I assume the guy that makes the plastic that ends up as a computer mouse or keyboard doesn’t see himself as having a Purpose job – however without him and his ilk the web wouldn’t exist as we know it. I know – I started with computers long before Windows and mice and boy was it hard work editing a document.
So moving on from excessively narrow interpretations of purpose, returning to the BizDev Cascade (and the Unbundling article – I haven’t forgotten it lol) we can enter Purpose from two directions – the value end or the client end.
So the value-driven, or product innovation (or supply-push) business has something to offer, something to say, something to get out of bed for. That would be the Tao of BizDev for example. A mission to help entrepreneurial businesses develop themselves more effectively and with less pain. And when one says “businesses” of course – in flesh and blood terms – there is no such thing – one is always helping people be more effective and less stressed.
As per Hagel and Singer client-driven or relationship-driven businesses have a bunch of clients with whom they enjoy a deep relationship and they serve those on a more demand-pull basis. The Big Four accountancy firms would be an example of this.
Hagel and Singer’s third category – infrastructure businesses – might well apply to say the power or transport industries. Mature commodity businesses deeply/somewhat regulated by government. There’s a purpose in doing these things but as a business it isn’t that much fun – I doubt many millenials want to go into electricity generation unless its via a value-driven green/sustainable start-up.
So what will happen? WIll we be stuck with Industrial Global Scale marketing businesses or will we transition to value-driven or client-driven businesses?
You are the consumer so vote with your wallet and let’s build the future 🙂
What relevance does purpose-driven have to you and your business?