Put the data to work!

Timberland

In the Timberland: Commerce and Justice case study covered in the 21722 lecture on April 14th, Jeff Swartz (p. 2) "believed finding more quantitative or analytical ways to demonstrate the link was becoming an imperative" to showing that Timberland's investment in social programs was critical to its business success.

Sears

This reminded me of an article I read a long time ago about how the US retailer Sears, Roebuck and Company implemented their Employee-Customer-Profit Chain (Rucci, Kirn & Quinn, 1998).  This model "tracked success from management behavior through employee attitudes to customer-satisfaction and financial performance" (p. 83).

Science!

Without relating the article, their approach to measurement was standard scientific method:

1. Ask a question
2. Do background research
3. Construct a hypothesis
4. Test the hypothesis using an experiment
5. Analyze data and draw a conclusion
6. Communicate the results

Cause and effect

Sears used an econometric statistics firm to analyse the enormous quantity of data on training, customer satisfaction, employee satisfaction, revenue and more that they had been collecting over the years.  The experts uses "causal pathway modeling" (p. 90) to explore the connections.  Their work clearly showed that employee attitudes (5 unit increase) drove their behaviour, which determined the helpfulness of the service they provided, which determined customer impressions (1.3 units), retention and recommendations and finally resulted in revenue growth (0.5%) and profit.

Employee-Community-Profit?

The Sears approach might be applied to Timberland.  The company has collected a lot of data on employee attitudes and involvement, social investment and financial performance.  Economic. demographic and social data might be available for US Federal, State and Local governments where Timberland and its community partners operate (and don't operate).  Then, causal analysis may quantitatively show the relationship between commerce and justice that Swartz is convinced exists.

Postscript - Sears "Leadership Skills"

The Rucci et al article also relates the skills expected of its managers:

Rucci, A. J., Kirn, S. P. & Quinn, R. T. 1998, 'The Employee-Customer-Profit Chain at Sears', Harvard Business Review, vol. 7, no. 1, pp. 82-97.