Ensuring clear, ethical principles is, in essence, the cornerstone for a robust business strategy. It would affect the specific activities that would be developed to achieve the strategy.
Based on the 6 ethical principles of Islam, here’s my “10 steps to an Ethical Business Culture” that help in developing an innovative approach to business as well as ensure sustainability:
1.Articulate a clear sense of purpose: Revisit the purpose of the business. The “why” are we doing this business OR “why” are we going into this business? This is the question which needs to be identified and answered with clarity.
The articulation of purpose will bring forth the business mission. The business mission should then be evaluated for the impact it would have on society. This would come about from the product or services it intends to market and how it affects the consumer. This social aspect of the business’s mission would also be the heart and soul of its brand identity (and be reflected through the overall brand experience).
2. Create a workforce committed to your purpose. Articulating the business purpose creates two key points:
(A) You communicate a consumer benefit (and win a bit more trust).
(B) More importantly creating – employee engagement on the business mission– employees working together for a common goal.
3. Define “how we do things around here”—Corporate Culture. People, by nature, like to ‘belong to groups’. In order to form such a group its necessary to provide employees a clear value system and a common cause. These usually are called brand values and become the guiding principles of how business is to be done.
There are three critical factors in detailing these values:
I. “The believe of the business unit in what’s the social benefit of the business will be”
II. “This believe needs to be genuine and strong enough to remain in place when tested”
III. “And they need to be translated into practice”
4.Manage the intangibles. In bringing forth a strong Islamic business model, financial success is only one dimension of the value provided by the business unit.Other factors which add to the value of a business include:
I. A clear strategic direction based on practicing the values articulated (i.e.: ‘walking the talk’).
II. A strong top management in order to champion the brand values and represent the brand identity to the brands’ eco-system. This would enable having engaged employees representing the brand reputation and innovation.
III. Developing a strong competitive advantage based on establishing and delivering the brand value and offer through brand experience. This in turn would lead to generating customer loyalty.
5.Develop a clearly articulated governance policy. The key governance factors of ethics, adherence to sharia etc would need to be clearly articulated and directions provided for employees dealing in the area of investment, compliance, competitive differentiation, improving reputation or winning customer loyalty. Thereby creating a process that will automatically provide for the good (of society).
6.Create a brand with personality. It’s an organisation’s employees that project the brand.In order to win over the stakeholders (the brand interacts with) one has to build trust. And trust comes through managing and delivering the brand values consistently. Having trust leads to a relationship which is liked (by the stakeholders) due to the personality of the brand which is reflected in the way the brand’s and the organisation’s culture is delivered.
7. Listen and involve people. The first step to gaining trust is to listen. If a brand does not have its finger on the pulse of stakeholder opinion, it doesn’t have a feel for its brand health. Listening, using the variety of mediums that are available, to hear what the stakeholders are saying and thereby get into a dialogue with them and engage them. The more engaged the people are the more they would want the brand to succeed.
8. Manage risk including risks relating to trust. It’s strange that “risk management’ is still in the purview of the finance departments. New corporate governance regulations have come about which make the directors have responsibilities in the area of ‘trust’ or customer satisfaction through transparent and authentic marketing claims. A part of risk management is to maintain transparency in terms of the claimed brands’ performance or delivery. Manage risk effectively and you can head off financial risks like additional legislation, taxes or consumer boycotts.
9. Leverage social change. Businesses tend to think good corporate responsibility is about managing the footprint of their impact on society. But real progress will be achieved when they use their muscle to achieve genuine social change linked to their business. It can be done in a way which wins trust and leads to genuine social and business benefit.
10.Invest in communications but make it a dialogue. There are many stories in almost every business.Bring these stories out. Communicate them to your stakeholders. After all the stories involve people and people are interested in people per se. And stories enable for a dialogue to take place thereby leading to engagement and a furthering a common cause.
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