10.292012

level 5 relevance

Last week at the Fast Casual Executive Summit, I introduced “Level 5 Relevance,” a framework for re-thinking corporate social responsibility.  The framework outlines how companies can become a force for positive change while enhancing their customer appeal and long-term competitiveness.

Level 5 Relevance involves shifting from thinking about programs that positively impact society and the environment as things to do — responsibilities to fulfill, boxes to check off — to pursuing them as ways to achieve greater relevance.  The framework helps companies design and develop their businesses so that socially responsible practices are embedded into the core of the business, so they’re aligned and integrated with each other, and so they create value that is shared by all stakeholders.

Here’s an overview of the Level 5 Relevance framework:

Level 1:  At the most basic level, companies should support the issues and platforms of their industries.

Level 2:  The second level is also pretty obvious – companies need to support their local communities.

Level 3:  The next level of relevance is target, meaning social efforts should resonate with the company’s target audience.   By supporting the things your target customers care about, you gain their attention, respect, and trust. So you want to be involved in the organizations that your target is involved with, be at events that trigger your targets’ charitable donations, and tap into the appeals that motivate their social consciousness.

Level 4:  Aligning your social efforts with your brand identity and competitive positioning is Level 4 in the framework.  The objective here is to reinforce your brand message and increase your differentiation all the while advancing your social relevance.

Level 5:  The last level of the Level 5 Relevance framework is values relevance.   This is about aligning and integrating your business with social values.

Progressive companies have designed their businesses or are innovating new business processes to create value for themselves and others in the inner workings of their operations. Some have reconceived their products to address social issues; others have transformed their supply chains.  Rather than simply supporting external programs, these companies are themselves becoming a force for positive social change.

Coca-Cola’s 5 By 20 program is committed to supporting 5 million female entrepreneurs by 2020.  Coke doesn’t have this program simply because it wants to support women or to make a difference in developing countries.  The program drives the company to develop “micro-distribution centers” which are businesses set up to sell its beverages in small, difficult-to-reach locations.  The company has worked with local Africans to set up 2,800 micro-distribution centers in countries such as Mozambique, Uganda, and Kenya.  The centers generate in excess of $550 million in annual revenues.  Talk about creating shared value!

Getting to Level 5 Relevance requires a series of deliberate steps:

  • It starts with leaders leading – company leaders need to put a stake in the ground and commit to making their values more than words on plaque in the break room.
  • Then you construct or reconstruct your business to operationalize the vision.
  • Then you engage your employees – you do this first because if your people aren’t clear on where you’re going and how you’re going to get there, how will those outside your organization?
  • Then you mobilize your other stakeholders. This might mean, for example collaborating with suppliers to develop different sourcing methods, or getting your financing partners to support the new investments you need to make.
  • Then you create a compelling narrative to communicate your vision — and you continue to tell your story, adding examples of actions and outcomes as you make progress.
  • And finally you evolve as you grow and the context changes.

The journey to Level 5 Relevance is an upward spiral of activity that propels your business to new heights.

(To learn more about this and other topics I speak on, contact me at mail AT deniseleeyohn DOT com or visit http://deniseleeyohn.com/business-speaking.)

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  • Thanks for the fresh thinking on CSR Denise! Love the Level 5 framework: easy to digest and use.