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Saturday
Oct182014

Alibaba's Success Formula - Customers 1st, Employees 2nd, Shareholders 3rd 

Jack Ma, Founder and CEO of Alibaba, has been speaking around the world espousing his philosophy of putting customers first, employees second, shareholders third.


Why should that seem so shocking to American businesses?


It is just a matter of fact that people working in the financial markets mainly and often only care about ROI and not the value of the services or products that the companies produce. That is because "their" customers are investors and often not the people who work or even shop at the companies they're invested in. You can't really fault those people working in financial services for often appearing greedy if they're just reflecting what many of their investors are. In fact I can't imagine a financial services person even making a case to a client for why a company is a good investment because of how well it treats its customers and people or even how good their products or services are, when it feels as if all the investor wants is a great ROI. 

There is a certain irony that if you are an investor in a company, when you shop at that company or work there or have an adult child work there, you really are focused on how well they treat you. But as soon as you put on your "shareholder" hat, you can completely forget all of that and be angry at the company if it is not giving you a great ROI.

If we all step back and think about Alibaba's, Costco's, Whole Foods, Trader Joe's, Patagonia's, Amazon's and Zappos' success formula of customer then employee then shareholder, it shouldn't surprise us. After all, delighted and happy customers beget happy employees and more sales all of which beget increased stock price begets happy shareholders.

What is the problem?

It appears that the world is intoxicated by a "more, sooner" approach to life. If you disagree with that, then ask yourself how you feel when you have to settle for "less, later." This has pushed most people in business, at least the financial services business to have "transactional myopia" which stands for "get the deal, do the deal, next deal." There is also a truth that when you're hyper focused on what's important, critical and urgent to you, all you care about is the "bottom line" when people are presenting something outside what is most important, critical and urgent to you.

That may explain why investors, when wearing their investment hat, in companies they also shop at or work for can tune out whether or not they're treated well as customers or employees, when the only bottom line they care about as an investor is their ROI. It may also explain why they wouldn't care about their investment adviser touting the value of how the company treats its customers and employees, even when they themselves shop or work there.

What is the solution?

It is very un-American and for that matter it is becoming very un-global. The solution is developing perspective. This means realizing and accepting that you really can't have your cake and eat it too. The challenge is to find a way for people to experience perspective as satisfying and fulfilling at a level that exceeds people's need for "more, sooner." In reality developing perspective does give you the "more, always" of contentment, joy, happiness and even love in ways that the "more, sooner" excitement of transactional myopia will never give you.

A few years ago I had one of the most amazing dinners of my life with Norman Lear and my late mentor, Warren Bennis. They are two of the wisest people on the planet. During our dinner I asked them both, "What do you think is the greatest threat to the world and mankind?" They both answered with the same word, "Expediency." I think they meant that not only does haste make waste, it can cause ruination.

I then asked Norman and Warren were they optimistic about the future.  They both said, "Yes, because if we weren't, we couldn't get out of bed in the morning."

I'm guessing Jack Ma would say the same.

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