Questions for John Camillus from Hospodářské noviny:
1. Your case study is mainly about humanity and social responsibility of companies in their business lines. Is it really essential to have such issues in their corporate strategies and thinking? Do you believe this can go hand in hand with economical aspects?
The answer is an emphatic "Yes!" In fact, I would go further and suggest that success on economic dimensions is dependent on and a consequence of paying attention to the criteria that I am including under the label "humanity." These criteria are:
- recognizing all humankind and
- being humane in decision making.
Let me explain what these criteria mean.
Recognizing all humankind means recognizing the global considerations and consequences of business decisions and also recognizing human beings in all economic strata.
Being globally oriented is absolutely essential in today's world. Many businesses can benefit from global opportunities and no business is unaffected by the global context. Recognizing all economic strata, particularly the poor who have been long ignored, has been demonstrated, of late, to offer the potential for great profit. In India for example, nine million new cell phone lines are sold every month, many to people who earn a few rupees a day but use inexpensive phones and calling plans to add to their income. Companies offering these phones and plans are earning revenues in the millions of rupees. Moreover the innovation and product development that is stimulated by attention to these "blue ocean" segments feed back into better and new products for the traditional, upper-income segments
Being humane means, for example:
- recognizing good design that makes products and ideas accessible to everyone;
- designing production processes and assembly lines that are safe and do not cause injury;
- employing ergonomic considerations so that, for instance, women can operate cars safely because cars have adjustable pedal positions and places to store purses;
- designing and offering financial instruments that do not bankrupt customers and ultimately cause economic systems to fail like the subprime mortgages in the U.S.;
- truly caring for employees whose capabilities, loyalty, goodwill and networks are crucially important to any organization.
It is also important to recognize, as I wrote in a recent (May 2008) article in Harvard Business Review, that many strategic issues that one encounters today fall into a category called "wicked problems." Wicked problems are difficult to define, involve multiple stakeholders with different and often conflicting priorities and have no demonstrably correct answer. The impact on profits of various responses to a wicked strategic issue cannot be determined. In these wicked contexts, the guidance provided by the "humanity" criterion is invaluable.
2. What exactly do you want to demonstrate? What are the goals of your project?
What I want to demonstrate, very simply, is that when strategic decision making recognizes "humanity" the company's bottom line benefits. The goals of the project are to demonstrate that strategic decision making based on humanity positively impacts profits, and also to show companies how to actually use these criteria when making decisions. Strategic decision making processes and techniques that employ multiple, qualitative criteria will have to be employed, in place of the traditional, linear, single-criterion-oriented processes.
3. What led you to studying this project? Is it your personal interest and of your colleagues, or do you feel it is needed.
The answer again is both. It is a personal interest of several of my colleagues and mine. Also, the need for this approach has been building for the last two decades and today is blindingly evident. Over the last twenty years, companies have gradually begun to realize that focusing on factors such as quality increases rather than reduces profits, that attention to safety is enormously beneficial, and that caring for employees' leads to a loyal and innovative workforce, growing knowledge and capability, satisfied customers and greater profitability. The sad condition of U.S. automakers, the sub-prime mortgage mess and the consequent global economic problems, probably would not have happened if the criteria deriving from "humanity" had been employed, instead of the shortsighted focus on quarterly profits. American car companies would have paid necessary attention to fuel efficiency, safety and renewable and clean energy. Predatory lending to homeowners would have been the exception rather than the rule. The U.S. and the world would have been in a better place.
4. How will the results of your case study be used? Will they become a material for students or will they be summarized in a manual for companies to "inject" a human approach to their strategic planning?
The case studies will be used in our Executive MBA and MBA classes. As you know, the University of Pittsburgh has a Worldwide Executive MBA operating on three continents and preparing to operate in a fourth. Our MBA classes in the U.S. attract a student body from over 15 countries with less than half from the U.S. Our students and the faculty recognize the fact that business is global these days and the cases that we are writing in several countries will help them understand how companies succeed in different countries and prepare them to do business globally.
Also, the cases that are being developed focus on companies that are already effectively using or moving towards using the criterion of "humanity." Their decision processes will show students and business people how to employ this criterion in practice and all the cases taken together, we hope, will serve as a manual for companies as you suggest. We will make the cases freely available on a website. In addition, we will be presenting examples from theses cases at an international conference on the Business of HumanitySM in early 2010. They will also be part of a book on the topic that will follow the conference.
5. You are in the middle of gathering data for your case study and you have approached many local companies. What is your opinion on Czech companies, Czech managers? Are their policies humane and socially responsible vis-a-vis their customers? How would you evaluate their strategies towards employees?
As you know, the University of Pittsburgh has been operating in the Czech Republic for almost twenty years. In addition, we work closely with the USBSP (U.S. Business School, Praha) here. As a consequence, we have been able to identify several excellently managed Czech companies that can serve as outstanding examples of the approach that we are studying.
The two Czech companies that we are focusing on in the first round of case writing are EMCO and Vodafone. These are two brilliantly managed Czech companies that can serve as global benchmarks for economically successful and humanity-oriented companies. Both have strong values that guide their business decisions, both care deeply for the well-being of their employees and customers, both employ innovative and different management approaches, and in both companies management and employees are proud to belong to their companies and proud of the contribution that their companies make. We will be describing their philosophy, management practices and decision-making processes in detail in the case studies.
6. How will the economical crisis effect the strategic management of companies? Do you expect they would lessen their "human and responsible" attitudes? What have you encountered so far and what is your estimate?
The economic crisis actually highlights the need for responsible, humanity-oriented decision making. In answer to an earlier question, I mentioned that the problems of the auto and financial services industries in the U.S. can be substantially linked to the lack of attention to humanity in their decision making. As a result of the crisis, managers, politicians and the general public are becoming deeply conscious of the responsibility of businesses to contribute to society and the communities in which they operate. I do not see how businesses can get through the current crisis or operate afterwards without recognizing the need and importance of humanity as a touchstone for sustainable economic performance. What we hope to offer through the research that we are dong is a simple framework for decision making that will show managers the techniques and processes that they need to know in order to apply the criterion of humanity. Through the case studies we also hope to reassure them that the approach will enhance economic sustainability.
7. As the Assistant Dean of University of Pittsburgh would you believe the crisis will affect the education sector? For example in the Czech environment, education is usually considered one of the sources of budget savings for companies. What is your opinion on this?
I have returned to the faculty in September as a chaired professor after my term as Executive Associate Dean ended. Based on my experience as an administrator and as a faculty member I believe, as a result of the crisis, we can expect several developments that will affect business education. The number of students seeking post-graduate education usually increases when there is a recession because students expect difficulty in finding jobs and therefore invest in preparing themselves better for the job market. The current recession significantly reduces the availability of credit so perhaps the increase in applications for graduate study may not be as great as in previous recessions as students may not be able to finance their education as easily as before. Companies are likely to cut their budgets for education and management development so non-degree management education and executive MBA programs will experience a downturn for a year or two.
8. Do you believe that additional education can be helpful in the time of layoffs and cutbacks? You think it can help someone to keep or to gain a job?
If companies believe in the importance of their employees, if they recognize that knowledge is the basis for competitive advantage, if they understand that their employees are the source of this knowledge that leads to competitive advantage and success, then they will continue to invest in employee development and grow employee loyalty. Employees who are laid off must also see this as an opportune time to enhance their knowledge and improve their skills. If they can demonstrate their improved capability to potential employers, clearly the likelihood of their finding and keeping a good job can be much enhanced.