Hannah Stolze, stakeholders, business, shareholders

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Am I My Stakeholders’ Keeper? (Also, Who Are My Stakeholders?) 

Wisdom, and how to approach business like a Christian.

All the law and the prophets hang on two commandments:love the Lord your God with all your heart, soul and mind, and love your neighbor as yourself (Matt 22:37–40). We easily see a public work life as separate from a more private spiritual life. It is easy to interpret this passage by the same: We may try hard to love God and our families and neighbors at home (i.e., next door neighbors), while a more integrated approach to faith and work might look k for ways to love God and others at work. 

Yet work and public life are important in Scripture. This indicates that our public and private lives matter to God. 

The books of the law, wisdom, and prophets in the Bible do not leave love at home in the “private life.” In fact, the books of the law, specifically Numbers and Deuteronomy, talk at length about love and public life by way of property rights and marketplace exchanges that reflect love for others. The law defines how the righteous people of God are to love others in public life. In agrarian or pastoral societies, home and work were one and the same. The role of resources (in Hebrew — meod — translated strength, resources, and wealth) was tied to work and property ownership. In fact, a neighbor is defined by that property, as you own land that is adjacent to other landowners. This is where the people of God lived out the commandments of the law and the prophets, and where can, too, only if we first love God and then love others. 

Who does the work benefit?

In Proverbs, Lady Wisdom plays an active role in the public square as she engages with students of wisdom and her servants/employees. In Proverbs 31:10–31, Lady Wisdom shows up again as an excellent woman, personified as a righteous and wise leader in the marketplace. She runs a textile company whereby many individuals benefit from the work of her hands. Suppliers profit from her purchase of raw materials. Her employees conduct tasks without fear of the winter. Customers benefit from the purchase of her linen garments and sashes. Finally, her family and the poor and needy in the community are clothed and fed with the profits of her work. As she works, those around her are blessed and her business is profitable, creating a positive impact that reaches far into the community. 

Corporations have primarily focused their efforts on profitability to the benefit of just one group of people — shareholders. These corporations have both grown to great wealth and imploded in recent years as they have focused singularly on maximizing shareholder wealth, many times ignoring other stakeholders. In recent years the maximization of shareholder wealth alone has been called into question. 

Peter Drucker, the father of modern management, argued that the firm exists for the sole purpose of creating a customer. Unfortunately, for many companies, maximizing shareholder value has warranted duping customers and exploiting suppliers and employees while avoiding taxes and leaving some communities worse off than others. This is a very current challenge for many companies who are grappling with the demands of shareholders while also striving to meet the needs of other stakeholders impacted by their business. 

Stakeholders include any individuals who are impacted by the operations of a business. Interestingly, Proverbs 31:10-31 references each of the primary stakeholders recognized in business literature. Primary stakeholders include shareholders, but also extend to:

  • customers,
  • employees,
  • suppliers,
  • the community in which the business operates.

These stakeholders show up in Proverbs as a husband investor (shareholder), merchants buying clothing (customers), servants (employees), flax and wool vendors in the marketplace (suppliers), and the poor and needy to whom Lady Wisdom offers aid (community). Stakeholder strategy has come under fire as the popular press has deemed it too difficult to please everyone. A recent article in the Harvard Business Review highlights the importance of leading in the stakeholder era while a counter article in the Wall Street Journal recognizes the difficulty of choosing which stakeholders to satisfy. However, following the golden rule, “treat others the way you want to be treated,” does not necessarily equate to treating everyone exactly the same. 

How to love your stakeholders

In supply chain management, the Pareto principle, or ABC analysis, is applied to customer relationship management in order to help prioritize the needs and expectations of customers. Pareto’s law states that 80 percent of wealth is typically created by 20 percent of people in any given enterprise or economy. This is applied in customer relationship management to determine the 20 percent of customers who make up 80 percent of a company’s revenue. The top 20 percent of customers should be delighted with the value they receive from the goods/services that they purchase. The next 60 percent of customers in the middle should be impressed with the goods/services that they purchase. While the final 20 percent of customers who contributed very little to the top line of the company’s revenue should merely be satisfied. 

I would anecdotally compare this to the people Jesus impacted in his ministry. There were the disciples who took up the majority of his time — just 12 men who lived, ate, and traveled with him. There was an ancient entourage beyond his disciples that followed Jesus from city to city and financially supported him. Then, there were the crowds of people who came to hear his teaching, were healed, and were provided with miraculous food on several occasions. Many of these received physical healing and may or may not have been present for the miraculous supply of wine or of loaves and fishes — but it is likely that they were satisfied with just hearing him teach! 

Based on this, a modern-day application of neighborly love is to know your neighbors, or your stakeholders, as Jesus sought to know those he ministered to. 

In short, love requires relationship. At a minimum, you need to understand your stakeholders’ basic demographics, values, needs, and desires in order to love them well. Jesus did this by asking questions of his disciples, individuals that came to see him, and the crowds he taught. In business, we do this through market research with three main goals: to satisfy needs and align values, to impress with the quality of our work, and to delight in going beyond expectations. 

Jesus did not delight all whom he met, but he did provide teaching that would have satisfied their needs if aligned with their values (think of those who believed him vs. the Pharisees and sadducees who did not). He impressed many with his teaching of the word and with his healing miracles, and he delighted those in his close circle as they saw miracles in his ministry and were empowered to do even great works. As we apply this to business, think about these goals:

  1. Satisfy. Do you understand the needs and values of your stakeholders – employees, customers, suppliers, and community) in order to meet their needs and satisfy them with your product offerings?
  2. Impress. Do you provide a level of quality that leaves your stakeholders feeling valued? Value is defined as the benefits of being in business with you outweigh the costs. 
  3. Delight. Do you have a key group of stakeholders that are so delighted and bought into your product offerings and business mission, that they are your champions and are truly delighted through life-giving interaction with your organization? 

Lady Wisdom exemplified these practices as well. She extended her hands to the poor and needy with the excess earnings from her business. She met the needs of customers and suppliers as she traded in the marketplace and expanded her business.  She cared for her household with family and employees taken care of in lieu of snow and coming seasons. All the while, she “opens her mouth with wisdom and the teaching of kindness (mercy) is on her tongue.”

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