loader image

A slowing Economy and Creating Shared Value

by | Dec 11, 2018

The world economies are showing signs of slowing and financial markets are correcting on the back of earnings downgrades. If this is a time of retrenchment then it is the time for strategic reevaluation and business transformation.

Cash is King

Cash generation will be a focus to ensure the rising cost of debt can be serviced.  All costs will be scrutinized and altruist donations reviewed – what better time to ensure that corporate programmes, which invest in the security of supply of resources whether human, capital or raw materials, are creating shared value and reinforcing business resilience whilst providing additional growth opportunities.


Time to invest in people and the community

Employee engagement and investment in the local community should not be considered expendable.  Continuity of funding is an important element of trust in relationships and the market depends on this in the exchange of goods and services.  Nevertheless, the business case should still be made. Strategic review on how effective the identified need is being met.  This requires clear identification of the value being created (social and business) and the discipline of metrics to measure performance against clear targets.

By adopting the strategy of Creating Shared Value (CSV), the strengths of business with its efficient allocation of resources through management discipline comes to the fore and benefits society as a whole. It eliminates waste and duplication as the service/product that delivers best value for money gains market share. Losers must be allowed to fail in order for resources to be reallocated.

Delivering Opportunities

As social welfare projects begin to adopt a Pay for Success model, currently being promoted by the government’s SIE Fund, the performance results will be interesting. For the creative, there will be new opportunities for business to enter and deliver products and services at certain points in the value chain.  These will not be exclusive to new social enterprises but rather open to forward thinking corporations of scale that can deploy at marginal cost and reap the benefits from additional lines of custom, just as other sources of demand slow.

Those companies that can align the business discipline of profit generation (which delivers value in excess of cost) with potential societal benefit from clearly targeted purpose can only but reinforce their competitive advantage.

Share This