The Ministry of Truth

It’s been a while since I last posted, as I’ve been rather preoccupied with writing a book (more on that at a later date).

In the meantime, here’s something that’s worth a look, discovered last week when I and a couple of pals attended the recording of Mark Thomas‘ new Radio 4 comedy show The Manifesto.

It’s the proposed Elected Representatives (Prohibition of Deception) Bill – a bill that, were it to make it onto the statute books, would make it illegal for politicians to lie. Brilliant stuff!

Unfortunately, it didn’t win the final vote and make it onto the people’s manifesto. (Then again, neither did other genius ideas such as pedestrian proficiency tests for London tourists!)

All the more reason to visit www.ministry-of-truth.net and add your name to the petition pressing for time to debate the bill in parliament.

The Dishonourable Member for [insert constituency]

Regular readers will know the tired drumhead I beat about regulation. Legal compliance does not a responsible entity make.

As a means to encourage more ethical behaviour, regulation (particularly self-regulation) is a deeply flawed strategy, and anyone who doubts it need look no further than the seemingly endless revelations in the Telegraph this past week concerning MPs’ expenses.

Anyone who still thinks increased regulation is the cure for all our woes needs their head examining.

As this rather grubby little episode in British politics clearly demonstrates, following the rules is no guarantee of probity. Far from it, all it seems to do is encourage people to think, “What can I get away with?”

Has Innocent sold out?

David Cameron (that’s the author of the On Brands blog, not the leader of the Conservative party!) posted an interesting question on LinkedIn the other day:

“Is the beloved Innocent Drinks company guilty of a bad brand move? Will the company’s new relationship with Coca-Cola backfire?”

I’ve written in the past about how pretty much everything you do as a business can have the power to enhance or erode your brand so, from that perspective, you’d probably expect me to say it is. After all, Coke’s reputation for CR, particularly in India, is not exactly stellar and certainly has the potential to tarnish Innocent’s ethical lustre.

Once again, though, the trusty MBA-grad’s all-purpose answer of, “it depends,” comes to the fore…

Whether or not it’s a bad move will ultimately depend on how hands-on Coke is in managing its investment. If it’s happy to let Innocent continue to produce the same products in the same way (as Innocent’s founders claim it is), I really can’t see the harm. All it will be doing is sharing its phenomenal knowledge and experience in marketing and distribution, enabling Innocent to spread its products (and its Gospel) to more people in more places, which I would’ve thought is a good thing.

The case of McDonald’s and Pret provides a useful parallel. Having studied Pret closely, as part of a major employer brand project a couple of years ago, I know that their employment offer came across as the very antithesis of the ‘McJob’.

True, there were rumours of McDonald’s seeking to move Pret to a more centralised model of food preparation and distribution, which, had it come to pass, would’ve blown a hole in a central pillar of Pret’s brand (the focus on fresh, safe, healthy food, prepared daily on the premises). But that didn’t happen, and there doesn’t seem to have been any damage caused to Pret by the association with McD’s.

Provided that Coke continues to let the Innocent guys do the Innocent thing, I can’t see any lasting damage to the Innocent brand either. It doesn’t make it any less authentic, other than among “No Logo” types for whom the very act of selling a stake to Coke is sacrilege, regardless of whether it leads to any material changes in how they do business.

Me? I’m perfectly happy to suspend judgement.

Authenticity, fairness and customer loyalty

Sure, profits may be down 26% as it strives to maintain cost competitiveness, but John Lewis is still outperforming most of the high street. Profits were still a very respectable £279.6m in 2008, and sales were even up 3% on last year to £6.79bn.

Equally significant, though, is that it’s been able to pay its staff a 13% bonus, and there can’t be too many companies able to do that right now.

Of course, the main reason for that is the John Lewis partnership philosophy – all its employees (or ‘partners’) are co-owners of the business, with profits being shared among them.

Picking up on my previous post, what’s really interesting about this is how the internal culture of the organisation has so indelibly imprinted itself on the minds of consumers.

A more textbook example of an authentic brand you couldn’t hope to find – the employer brand (‘A different sort of job’) and the corporate/consumer brand (‘Never knowingly undersold’) evidently united by a core thought of ‘fairness’.

The absence of shareholders is undoubtedly a major proof-point behind this brand story – the principle that, without the need to play to their demands, John Lewis is free to focus all its attention on looking after its customers, its suppliers and its staff.

Again, that idea has clearly implanted itself in consumers’ consciousness. Indeed, watching reports on Newsnight the other night, it was remarkable that, even in this downturn, the thought of shopping anywhere else simply didn’t enter John Lewis customers’ minds.

They eschew trading down because they perceive shopping with the costermongers inevitably involves some sort of compromise – either on quality, on service or on ethics. For other retailers to cut prices, whilst maintaining profits and shareholder returns, someone else must be taking the hit – if not them, then someone else in the supply chain.

The essence of the value proposition? John Lewis may not be the cheapest, but ‘you get what you pay for’ and no-one gets screwed in the process. And judging by the results, it’s one that appeals to a lot of people.

So should John Lewis’ partnership model be seen as the prototype for a different, more responsible form of capitalism? I don’t know.

Regardless, what I do know is that many other businesses could learn a lot from them – about what it means to be authentic, to be responsible, and how both can make a huge difference to a company’s competitiveness.

“It’s that Mr. Nobody again!”

One of my mum’s refrains, from when I was a kid, is being invoked on an increasingly regular basis. It seems that Mr. Nobody (that bloke who trampled mud all over the living-room carpet in 1979) has returned to wreak havoc on our financial system!  

As I re-read reports of the big bank bosses’ appearance before a parliamentary committee last week, I can totally understand mum’s frustration whenever my sister and I chose to claim complete innocence for disasters that were clearly of our making.

Bank bosses accept no culpability because, they claim, no-one could have foreseen the circumstances that have since befallen us.

The trouble with such claims is that it just ain’t so. I can say that with confidence, having been treated to a superb MBA session on macro-economics with Roger Martin-Fagg back in Spring 2007.

Whilst I’ll confess that a fair bit went over my head, his predictions were straightforward enough: there’s an American sub-prime bubble that’s set to burst and, when it does, we’re going to find ourselves in the middle of the deepest recession in living memory. (As predictions go, I’d give him 10/10!)

Whilst playing the blame game doesn’t solve anything, and I know it’s totally naive, I just can’t help wishing that one of these senior bankers would have the balls to ‘fess up and say, “My bad.”

“We didn’t see it coming, we took risks we shouldn’t have, and we’re all paying the price. It’s going to take a very long time to rebuild your trust, but we hope that an honest admission of our fault can be the first step in that process.”

Would that really be so hard, or so damaging, to say? 

Bank bosses: you stand guilty in the court of public opinion anyway, so why not take out the Teflon shoulder pads and show a little contrition? At least then we’d know what you’re actually sorry for!

At the moment, as Nick Robinson so beautifully describes it, their apologies are a bit like the captain of the Titanic saying sorry for the existence of the iceberg, rather than for helping steer us into it.