The Purpose Of A Corporation, Redefined

This week, almost 200 CEO’s agreed to an updated definition of “the purpose of a corporation.” The statement was made by the Business Roundtable, a very influential group chaired by Jamie Dimon, the CEO and chairman of JPMorgan Chase.

The new definition starts like this…

Americans deserve an economy that allows each person to succeed through hard work and creativity and to lead a life of meaning and dignity. We believe the free-market system is the best means of generating good jobs, a strong and sustainable economy, innovation, a healthy environment and economic opportunity for all.

This new view on purpose pulls from the community of “conscious capitalism” which has been pushing for companies to recognize a broader responsibility to society, which requires considering all stakeholders (not just shareholders) in its decisions.

My take: I totally agree, it’s a long overdue shift in leadership thinking.

For many years, I’ve argued that management viewpoints have become woefully outdated.  As I wrote in a 2009 post “Fundamental Flaws In Management Education” which captures some ideas from an amazing paper written by Sumantra Ghoshal in 2005:

Management focus has been driven by economists like Milton Friedman who argued that corporate officials have only one social responsibility: making as much money as possible for their shareholders. But the value that a company creates comes from a combination of resources contributed by different constituencies. In most cases, the contribution of knowledge and skills of employees is more important to the success of the company than the contribution of capital by shareholders. And since most shareholders can sell their shares easier than employees can find new jobs, they are actually taking on less risk. So it does not make sense to maximize the returns on only one of those resources, especially the shareholders’ financial capital.

Even Jack Welch, the ex-CEO of GE who really championed the notion of shareholder value during the 1980s and 1990s has updated his thinking and said, “On the face of it, shareholder value is the dumbest idea in the world. Shareholder value is a result, not a strategy.”

To me, the purpose of an organization is very simple… “to create value.” All of the participants in an organization, including employees, investors, suppliers, and the communities in which organizations operate, are dedicating some of their scarce capacity to an organization. The output of those contributions should deliver value for all of those stakeholders beyond what they’d gain from dedicating those resources to other options.

The key to success is to redefine “value.” Instead of thinking of it as a stock price or monetary valuation, consider value to be a broader set of returns that come from enhancing the lives of all stakeholders.

The bottom line: Let’s define our purpose as adding value to people’s lives!

Five Recommendations For De-Emphasizing Benchmarking

Benchmarking, benchmarking, benchmarking… it’s a popular subject.

I’ve been publishing CX benchmarks for more than 10 years, so you might be surprised by my point of view on the topic: benchmarking is often overused and misinterpreted. I’m not saying to give up on the entire activity, but people often spend too much time and energy focusing on industry comparisons that aren’t necessarily an accurate reflection of the genuine customer experience.

Let […] Continue Reading…

Talking Employee Experience and XM With Ben Granger

Our team joined Qualtrics last October to create the XM Institute, and one of the great things that we’ve found is that there are many people across Qualtrics who are experts in different aspects of Experience Management (XM). So I decided to interview one of them, Ben Granger.

Ben is a Sr. Principal for Global EX Strategy. He spends his days thinking about and helping organizations design leading-edge EX programs. Like many […] Continue Reading…

Operationalizing XM: The Report

I’m super excited to announce the publication of new research from the Qualtrics XM Institute, “Operationalizing XM.” It describes how organizations can tap into experience management (XM) to continuously learn, propagate insights, and rapidly adapt—capabilities that can be used by just about every organization. It’s a must read (and a free download) for anyone who cares about or is just interested in XM.

The report outlines the XM Operating Framework, […] Continue Reading…

Reflecting On 6 Principles Of Success

Given the recent closing of Temkin Group, it seems like a good time to reflect on what I’ve learned over the last decade or so of building a successful business, creating a world-wide association, and nurturing the CX movement. Looking back, here are six principals that have helped me succeed:

Actively Simplify. When faced with new situations, it often seems easiest to add layers of rules or additional concepts. […] Continue Reading…

Goodbye Temkin Group Website…

Well, it has finally happened. After being acquired by Qualtrics this past October, we have decommissioned the Temkin Group website. And yes, I have mixed feelings. To quote a line from Winnie-the-Pooh…
How lucky I am to have something that makes saying goodbye so hard.
It’s hard to say goodbye to a site and a brand that we built and nurtured since May 2010. Over the last eight years, we’ve been […] Continue Reading…

My History Of Enterprise Transformation And XM

I’m frequently asked to share my views about the evolution of experience management (XM), so I’ve spoken (and written) about topics such as CX establishing the foundation for XM. For some recent speeches I’ve combined my personal introduction with a broader overview of the evolution of enterprise transformation.

After several requests, I’ve captured the content in this short (5 minute) video. It’s a recount of my professional experience and observations from […] Continue Reading…

Service NSW Tops My Worldwide XM Tour

I’m on my way back from Australia; the end to a very long, but wonderful road trip.

I’ve had a busy couple of months, delivering speeches and training in Salt Lake City (twice), London (twice), Orlando, Madrid, Sydney, and Melbourne, in addition to remote sessions in Paris and Philadelphia. What have I been speaking about?

Operationalizing Experience Management (XM). As I’ve discussed, XM will drive transformation across organizations for the next decade. But […] Continue Reading…

Stop Obsessing About Organizational Alignment

I was recently asked a question that I hear a lot, how do we get alignment across our large, complex organization? This is an important question since the path to Experience Management (XM) often requires large-scale change.

I’m now just saying: Stop focusing so much on it. Instead of trying to gain full alignment before you begin, build it over time in an iterative manner that I’m calling Agile Alignment.

When […] Continue Reading…

Is NPS A Dubious Fad?

Okay, it’s that time again. Every few years someone ignites the debate about whether Net Promoter Score® (NPS®) is a great or terrible thing. A recent article in the WSJ (The Dubious Management Fad Sweeping Corporate America) has sparked the discussion this time.

Rather than write something entirely new, I decided to share something I wrote in 2015 that addresses the issue. Before I share that post, I also suggest you […] Continue Reading…

Exciting News From The XM Institute

The time has finally come for me to tell people to stop purchasing Temkin Group research reports. Are we eliminating them? No. Are they irrelevant? No. We’ve just decided to give them away for free on the Qualtrics XM Institute site.

That’s right, you can now get access to almost our entire research library for free. One of the reasons we joined Qualtrics was to be able to help more […] Continue Reading…

Six Categories Of X&O Data Insights

Last week I attended SAP’s SAPPHIRE and CX Live events in Orlando. It was great to see 35,000 or so of my new friends. As you might expect, Experience Management (“XM”) was a dominant theme. Just about every SAP or Qualtrics keynote speech discussed XM, and it was a topic at many of the concurrent sessions. I really enjoyed seeing the XM message come to life in so many […] Continue Reading…

CX to XM: Propelling Humanity & Intelligence

As you have hopefully seen, I’m now running the Qualtrics XM Institute, where we will be producing easy-to-consume, compelling content and training that both inspires business leaders with experience management (XM) possibilities and helps them drive value from their programs. Many people have asked me recently about why we’re now focusing on XM instead of on customer experience (CX).

The quick answer is that we are still focusing a lot on CX. […] Continue Reading…

Complexity Is An Experience Killer

I just spent two days in Miami with a great group of executives who are part of the SAP CX Client Advisory Board. One of their presentations described the company’s technology transformation, and included a stream of activity around “decomplexing.” I loved seeing that!

Complexity ends up oozing its way into all types of experiences. Complex products, prices, or processes lead to ill-prepared employees and confused customers. A complex set […] Continue Reading…

The Human Experience Cycle

As you think about your experience management (XM) efforts, it’s important to understand  how people flow through the experiences in their lives — as customers, employees, patients, fans, citizens, students, etc. To help deepen that understanding, I’ve created a simple model, the Human Experience Cycle (HxC). As you can see in the chart below, the HxC is made up of five elements:

Expectations: What a person anticipates will happen […] Continue Reading…