Wondering how your company can become more competitive in today’s “anti-corporate” business environment? (Or at least a business environment that’s portrayed as being “anti-corporate.”) Hey. Who isn’t? Apparently it’s “known” that today’s company operates in an “anti-corporate” environment. So let’s talk about it.
I recently finished reading “Engaging Fringe Stakeholders for Competitive Imagination” by Stuart Hart and Sanjay Sharma. In this 2004 article from the Academy of Management Executive, the authors offer up the theory of engaging with “fringe stakeholders” in order to reach two objectives. The first objective, which is related to anti-corporatism, is about avoiding what the authors call “smart mobs,” which they define as the wrath of individuals that can be created and mustered online for the purpose of spreading negative information about the company. The second objective the authors describe is related to efficient product development. The achievement of both of these goals depends upon getting pertinent information from the fringes of the stakeholder sphere which surrounds a company. The article details how companies may go about achieving these goals.
The achievement of the second objective, more efficient product development, is described with various case studies showing how certain corporations have extended their market research operations to the outer fringes of the societies in which those companies do business. From this “fringe information” collected have come new initiatives for products designed to solve problems that the companies had not known existed prior to their journey to the fringe. Thus, the term “competitive imagination” used in this article’s title. The insights gained through the fringe market research give those companies who conduct it a competitive leg up on their competition. Very sound reasoning. No objections here at all.
There is a double-edged sword in this approach, one that cuts toward both objectives. The authors maintain that by performing this type of informational outreach, not only may a company discover new consumer insights for application within product development, but the company may also simultaneously engage with fringe stakeholders, or what they describe as “non-salient” stakeholders, who had previously been ignored by the company. As I pointed out earlier, this is the first objective that the authors raised. Hart and Sharma say that through this engagement and interaction with, and from the subsequent input from, these fringe stakeholders, the company may preclude a public relations backlash initiated by these fringe actors, who may manifest as the “smart mob,” against future company actions. Again, I have no objections here. Proactive communication can serve as a preemptory tactic, reaping future benefits. But what I do object to is the premise upon which Hart and Sharma base most of their thesis. That premise is found in one pair of statements near the beginning of this article.
On the second page of this article we see the passage,
The power of governments has eroded in the wake of globalization and the growth of transnational corporations with global supply chains that span several continents. Non-governmental organizations (NGOs) and civil society groups have stepped into the breach, assuming
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