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World Inc. Excerpts
Chapter 3:
Social Response Capitalism
Main Points for Chapter Three:
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The industrial revolution, viewed by some as a "senile" form of capitalism, is being displaced by social response capitalists in many sectors and companies
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This new form of capitalism is based on a slightly different corporate creed, a different corporate trinity where products are designed on the basis of price, technical quality, and, increasingly, social response.
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Past efforts at becoming a good corporate citizen often focused on production techniques and efficiency, but the latest twist is to add superior products themselves as the best high-octane boost to brand reputation and stock value.
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The smart corporate leader is pushing his or her company not just to give consumers what they want, but what they need. This adds the element of social consciousness to products, so that a firm competes for terrain and technological advantage, but also for the winds of social preference to fuel their growth.
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Among the drivers of Social Response Product Development (SRPD) are population growth, declines in fossil fuel supplies, and the fact that 51 of the world's 100 largest economies are now corporations and not countries. These developments are likely to peak by 2015, so now is the time to strike before it becomes the norm and leaves you less time advantage.
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The five primary benefits of SRPD are: margin improvements, rapid cycle time, market access, product differentiation, and a social bundling of value in products.
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There are still serious and recurrent barriers to social response product development, including the sobering fact that new business leaders have not been taught the right skills and that most products on the market today fail the social response test.
Watt's steam engine in the vestibule of the Escuela Técnica Superior de Ingenieros Industriales de la UPM in Madrid.
Photographed by Nicolás Pérez
