The Clean and Green Club

Fabulous article at Grok.com on how a buyer’s state of mind may be different when considering a purchase than his or her normal personality.

This month and next, we’ll look at the dark side: two books that look not at what can be made right in corporate America, but what went wrong.

The Rise of the Rogue Executive places much blame on internal procedures that jettisoned 100 years of responsible practices, and the technologies that made fraud and profiteering possible on a scale that simply wasn’t possible in generations past.

And sometimes, flat-out lies, as in WorldCom using a totally theoretical “what-if” spreadsheet looking at the opportunity if Internet use doubled every 100 days as the basis of its income projections! The result of this total lie was devastation in the telecom industry, which was frantically laying cable in order to keep up with this demand prediction.

Another key cause was the incentive structure (eliminated by Sarbanes-Oxley in the aftermath of Enron’s collapse) that turned consultants and auditors at Big Six accounting firms such as Arthur Andersen into sales staff and pressured auditors not to jeopardize the far more lucrative consulting business (the book reproduces the full text of the Anderson indictment, in fact). Can you say “conflict of interest?”

And taking it further, CEOs face pressure to cook the books or look the other way when those to whom they delegate are unethical, both because of their own ludicrous compensation structures and pressure from investors for short-term growth. (The book cites bad behavior on the part of Dick Cheney during his Halliburton days, among others.)

But ethical, involved leaders can surmount the challenge. The book discusses this, but this part is much weaker, mostly focusing once again on the wrongdoers. I’d have liked to see that part built up.

Of course, my own award-winning sixth book, Principled Profit: Marketing That Puts People First covers that part in detail, explaining how to set up and run successful ethical companies.

And one easy step companies can do is to sign the Business Ethics Pledge, so consumers know of their commitment.

Find this book at Amazon: The Rise of the Rogue Executive: How Good Companies Go Bad and How to Stop the Destruction by Leonard R. Sayles and Cynthia J. Smith (Wharton, 2005)

Here’s a 10-point program for greatness:

1. Deliver WOW Through Service
2. Embrace and Drive Change
3. Create Fun and A Little Weirdness
4. Be Adventurous, Creative, and Open-Minded
5. Pursue Growth and Learning
6. Build Open and Honest Relationships With Communication
7. Build a Positive Team and Family Spirit
8. Do More With Less
9. Be Passionate and Determined
10. Be Humble

These are the core values of Tony Hsieh, CEO of Zappos.com, “a customer service company that happens to sell shoes.” Lots of shoes, at that: 1,080 brands, 155,725 styles, and 2,885,850 separate products–including, for instance, 15 pages of vegetarian-friendly shoes containing no leather! And it’s easy to navigate the site, drilling down for example from shoes to men’s dress shoes for wide feet in just a couple of clicks.

Add to this huge selection a low-price guarantee, free shipping on both purchases (overnight, at that) and returns, a one-year return policy

Zappos is a powerful example of delivering such a good experience that people have to tell their friends (something I discuss extensively in my award-winning sixth book, <a href=”https://www.principledprofit.com”>Principled Profit: Marketing that Puts People First</a>).

In fact, I learned about the company because of a post in the LED discussion list (highly recommended) by listowner Adam Audette, who happens to manage the Zappos discussion list. Thousands of people learned about the company from that post, or from a blog post on voodoventures.com about touring the company and discovering such perks as a blow-off-steam room, a substantial lending library, as well as extremely accessible senior management (often another hallmark of successful ethical companies.

Does it work? The company expects to break $1 billion next year. I’d say that’s pretty good!