The Changing Business of News and Public Radio: “Pushing boundaries doesn’t have to mean compromising our integrity”

Posted on May 8, 2014 by jeffhoffmanassociate

“The state of public radio is uncertain. It’s terrifying and will change what we are doing. But not to scare, because there are a lot of solutions!” This started out the remarks by Guy Raz, host of NPR’s TED Radio Hour. He was this year’s speaker at the James L. Loper Lecture in Public Service Broadcasting presented by the University of Southern California’s Annenberg School of Communications & Journalism. Being both a graduate of the Annenberg School and a voracious consumer of quality news, I found his talk to be refreshingly pragmatic as well as visionary. He spent much time talking about the disrupters to news and how it is disseminated. From how the Guttenberg printing press challenged the gatekeepers of news of the day, to how technology is challenging the gatekeepers of information today. And not only news content, but how the economics of news is either changing, or will have to change. An example is how Craigslist virtually eliminated the classified ads in papers, what had been a strong source of revenue.

Up until now, public radio has been fairly immune to the changes. But when Apple put podcasts on iTunes, it meant content is available on the listeners terms, not when it is aired. For public broadcasting, that means the revenue from the periodic pledge drives will most likely decrease as people are “listing” in different ways… “radio” is just one form of “audio.” “Growth will happen in the audio space, but not over the air.”

The opportunities for news are tremendous. Over one billion people have seen a TED video and they have been watched from some of the remotest parts of the globe. That is one in seven people on the planet. And while traditional news had honed the sound bite, “the art of storytelling is experiencing a renaissance.” “We want to take you on a journey that will change your view of the world. People are hungry for stories. People will make time for stories that are worth their while.” One comment that so resonated with me is that “we need to help our audiences distinguish the news from noise!” There is so much fluff and commentary, the important, and factual, news is often lost. “The big problem today is how do we commoditize
news?” We have seen the decline and disappearance of newspapers, this has resulted in less reporters covering stories. There are fewer news bureaus around the world. “It is just too expensive. We need to get out of our comfort zone as to continuing paying for quality news, we need to look at some type of sponsorships… while maintaining our independence. Pushing boundaries doesn’t have to mean compromising our integrity. The change is going to be how we are delivering the content.”

http://www.npr.org/2013/12/13/248190652/spoken-and-unspoken http://annenberg.usc.edu/

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New Report focuses on the Value of ESG on Brand and Reputation Management

Posted on April 17, 2014 by jeffhoffmanassociate

Sustainability Matters 2014, a report from The Conference Board (TCB), is full of interesting perspectives and metrics. Three of the sections I found to be particularly interesting, “Sustainability and Firm Performance,” “The Link Between Sustainability and Brand Value” and “Communicating Sustainability to Enhance Corporate Reputation.”

Sustainability initiatives impact on the bottom line had long been anecdotal until we began to see solid indicators around environmental issues, in particular, being material. The report illustrates a new business case model “in which sustainability initiatives are assessed in an economic manner and pursued on the basis of a clear link to financial performance.” Through a survey done by McKinsey and Boston College, they cited, “innovation, new products, new customers, and new markets as specific areas where sustainability factors have demonstrable impact on overall organizational growth.”

I have written much about cause marketing and philanthropy in regards to brand, which is very consumer focused. This section of the report discusses brand value and its connection with environmental, social and governance (ESG) performance. TCB takes two studies, one by CSRHub and the other from the Brand Strength Index to look at over 1,000 companies from 54 countries. “Brand value and sustainability are related, and a company that seeks to do well in one area should consider also investing in the other.” Relating to the treatment of people, both employees and third parties, this study shows that “ratings in this area are higher when a company is more transparent and discloses its behavior.” Employee engagement programs, in my opinion, adds so much value and it’s great to see this report validate what has been an important focus in my work. “Many studies have shown that consumer brand impressions are heavily influenced by the behavior of a company’s employees. Polite, knowledgeable service people; employees who actively serve in community organizations; and personal contact between employees and customers can directly affect how a brand is perceived.”

Communicating corporate social responsibility initiatives of a company is critical and in this section on corporate reputation there is a fascinating diagram charting companies by the Sustainability Reality Score on the x-axis and the Sustainability Perception Score on the y-axis. The quadrants are labeled Leaders in the upper right going clock wise Promoters, Laggards and Challengers. Some of the positions made sense to me based on my knowledge of the companies, such as IBM as a Leader and Facebook as a Laggard. Others, from a perception standpoint rated high such as Apple, where their reality score is low (Steve Cook is doing better than his predecessor, especially with employee engagement, but they have a long way to go to be a CSR Leader). Clearly, as stated, their positive score is based on the popularity of their products and the “halo” effect that goes with it. The companies, Starbucks and Marriott, two that I think of having solid CSR practices, and are also known for positive practices, are high on the latter but surprising to me, they are on the lower half of the reality score. I am curious as to the data that lead to these findings. Here are the key takeaways from this section:

• Treat Sustainability as an integral part of business strategy, not just a compliance issue.
• Take responsibility for the impact of internal operations and those of associated entities, such as supply chain partners.
• Implement GRI (Global Reporting Initiative) standards for reporting and ensuring that the materiality of sustainability issued is understood by all stakeholder groups.”
• Integrate sustainability into brand and client value propositions.”
• Focus their operational initiatives and communications on carefully selected themes tied to the core of the business.”

The CEO as the steward of the company’s reputation is a topic towards the end of the report. While I agree the CEO should have this role, I also firmly believe that the CEO has to be the steward of good corporate citizenship, owning CSR initiatives and integrating them into the company. True, positive reputation comes from the real integrity of the business. The CEO sets the tone.

http://www.conference-board.org/publications/publicationdetail.cfm?publicationid=2683

 

 

 

 

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Special Olympics World Games Los Angeles 2015

Posted on February 20, 2014 by jeffhoffmanassociate

The Special Olympics World Games Los Angeles 2015 is coming in 17 months. Yesterday, I attended a kickoff event to learn more about the exciting plans. Los Angeles is both proud and honored to be hosting this event. It will be the largest sporting event to be hosted in LA since the 1984 Olympics. To give you an idea of the scope, there will be 7,000 Special Olympics athletes from 170 nations, 30,000 volunteers, 3,000 coaches and 500,000 spectators participating in twenty-five events over nine days at 27 venues. The projected economic impact to the region is nearly a half billion dollars. The cycling, half marathon, kayaking and sailing events will take place in Long Beach, the longtime home of the Southern California Special Olympics Games. The dates: July 25, 2015 – August 2, 2015. My involvement with Special Olympics spans many years through Disney. Going all the way back to junior high, I was a student aid in a class for students with intellectual disabilities. The Special Olympics movement is truly transformational, not only for the athletes, but for everyone involved.  www.LA2015.org

 

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Doing Business in China: Ask the Right Questions

Posted on January 9, 2014 by jeffhoffmanassociate

“Board’s Oversight of China and Growth Strategies in Asia” was the topic of yesterday’s meeting of the National Association of Corporate Directors. Three China experts participated on a panel discussing what business leaders should be thinking about in regards to China and the rest of Asia. The speakers were DJ Peterson, President of Longview Global Advisors; Kenneth DeWoskin, Chairman of Deloitte’s China Research and Insight Center; and Dean Yoost a retired partner at PricewaterhouseCoopers. All had great insight and experience with Dr. DeWoskin marking 50 years learning about China.

Political reform in China is very challenging as there are differences in opinions within the power elite and they insist on the mutuality of political and economic success. It was noted that there are deep irreconcilable differences between how China and the U.S. does business. China leaders will not make the same mistakes that the leaders of the Soviet Union made, such as loosening up on dissent. The Communist Party in China is looked to for reform, but banks, large state owned enterprises and the military all have vested and conflicting interests. China suffers from a lack of constraining elements. A one party system with no disclosure in its financial system with rapidly increasing debt. Although the issues are well understood, we haven’t yet seen many policy changes from the new leadership as there is no clear view on how to address these issues within Chinese leadership.

Many foreign businesses are now experiencing the economic slowdown in China. While many are reporting growth, the growth is coming primarily from expansion as comparable same store sales decrease. This is most apparent in tier 2 cities. Chinese consumers do have a strong desire for foreign brands, though the government is putting pressure on these brands, especially reputationally, as the hope is that Chinese brands will take their place. How companies are differentiating themselves is critical. Don’t think of China as a monolith, a more sophisticated analysis and a strong understanding of the nuances is required. The Chinese are more aggressively competing globally to compensate for excess capacity. The Trans-Pacific Partnership Agreement will help bring together the region and should become more harmonized as a result. Corruption is still a big issue throughout the region. Boards members need to ask “who are our business partners?”

There is a strong appetite for foreign money coming into China. There is concern about inflation spiraling out of control. The currency is, and will be, a good indicator of China’s health. The government feels it more important to hit the GDP goal that maintaining solvency in the banking system. As a result, the government props up the banks. An example, construction currently far exceeds the demand. And part of this is to create jobs and increase economic activity. Some governments pay welfare, a Chinese example would be to build a new airport… on government land, purchasing cement and steel from government owned companies, and then the finished product operated by the government. The government makes money, people are employed and they get a new airport (whether they need it or not!).

There was some mention of other countries. There is excitement about the prospects for the Philippines, even in the wake of the typhoon. It will probably be at least a year before we see much movement in India. With elections this summer, there is no momentum to get anything done now. On a positive note, it looks like the probable new Indian Prime Minister will be more business friendly.

The discussion was well balanced, trying to illustrate both the risks and opportunities of doing business in Asia. It is critical that businesses proceed with eyes wide open and that executives and boards ask good, probing, questions of staff, business partners, auditors and regulators. http://southerncalifornia.nacdonline.org/Events/EventDetail.cfm?ItemNumber=7869

 

 

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Small Business, Big Impact

Posted on December 18, 2013 by jeffhoffmanassociate

A company of any size can apply the principles of strategic philanthropy while meeting the needs of the community. Favilli Studio is a design studio that focuses on theme park and resort development. Creativity is core to their business. Small but mighty, this business is led by Andrea and Camy Favilli. They realized that today’s generation does not benefit from the quality arts education that they both received. While taking on the arts education issue facing school districts is daunting, through a friend they discovered a community based organization call Verdugo Young Musicians Association. “VYMA was founded in 2001 by a group of parents to supplement existing music education by offering ensemble opportunities for children preempted from joining an orchestra because of age, ability and/or financial means. VYMA’s goal is to provide inclusive, high quality music education by professional, performing musicians in a nurturing, fun, non-competitive setting. This approach has proven to be highly successful. Children with minimal training have achieved recognizably impressive standards of classical music excellence.”

Here is how Favilli Studio has helped. For a contribution of $2,000 they were able to provide 10 violins and two cellos for the orchestra. For two years now, another business leader, Tim Stratz of Stratz & Co. Financial Services, has conducted a fundraising concert for VYMA where attendees can see the Grammy award winning cellist Steven Erdody and “friends” who are amazing soloists and studio musicians. The performance is called Heartstrings. The logo and invitation were designed by Camy Favilli. Favilli Studio was an event sponsor and the couple, along with their young son, attended the community concert. This is small business strategic philanthropy at its best. They provided cash, in-kind support and pro-bono volunteering for a small local nonprofit. They are helping address a community problem of the lack of music programs in the schools. It is a program that fosters creativity. It aligns with their core business function and acknowledges the special role that music plays in storytelling. They are utilizing the expertise of Favilli Studio to further the mission of the VYMA. And they are supporting an effort in the community where they, and their team, work and live. This is a true win-win-win partnership… for the business, its employees and the community. You don’t have to be a large business to make financial donations, engage employees and make positive community contributions. The Favilli’s did it by pulling on the heartstrings! http://www.vyma.org/ http://favillistudio.com/

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One Stop Shopping… A Social Enterprise Marketplace

Posted on November 19, 2013 by jeffhoffmanassociate

Just in time for the holiday gift giving season, Blake Mycoskie, Founder and Chief Shoe Giver of TOMS, has created a marketplace to bring together a selection of products that make a positive impact on various regions of the globe. TOMS curates, sells and promotes over 200 products from 30 different companies that incorporate giving into their business models. “We believe commerce can be about more than just profits. But it takes more than belief to make this a reality. So we’re giving other social entrepreneurs a platform right here on our site to help them succeed. Introducing The Marketplace, a new destination for making a difference.” I was impressed with the selection. Hammocks, lamps, wine bottle holders and earbuds to the expected apparel and accessories. I hope the marketplace is successful. Many socially responsible companies are small and this type of showcase can make the difference between being wildly successful and mildly successful or even failure. It’s nice to see department stores such as Bloomingdales sourcing local, socially responsible items in their stores. As shoppers become more socially aware, these types of offerings aren’t only the right thing to do, it’s good business. www.toms.com/marketplace

 

 

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Creative Confidence

Posted on October 27, 2013 by jeffhoffmanassociate

Brothers Tom Kelley and David Kelley have written a new book titled “Creative Confidence, Unleashing the Creative Potential Within Us All.” On Thursday, they discussed the book and the creative process at a forum hosted by the Milken Institute. David Kelley, Founder of IDEO and the Stanford D.School, is credited for creating the computer mouse amongst other things. The conversation was moderated by Patrick Adams of Secret Weapon Marketing. “Courage to act is often more of a challenge than developing the idea. Fear of being judged, failure, is a major block to creativity.” They emphasize a “bias towards action,” which really resonates with me. They discussed creative teams and partnerships. The importance of having others to bounce ideas off of and to build upon. “Radical Collaboration… from a diverse disciplinary approach. Putting unlikely people together to create solutions.” Attributes of a good partnership, “same values, complementary skills.” Another way to foster creativity is through relaxed attention. “Find a time when your brain is running free. Think about a problem you are dealing with, and try to come up with a new solution.” David has a white board in his shower so he can capture thoughts when he has them, as often the best thoughts are fleeting.

Reframing the question is often key to innovation. One example is from the organization Embrace. The original question, how to create a lower cost incubator that will function properly in the developing world with inconsistent electrical supply. The issue: “20 million low-birth-weight and premature babies are born every year around the world, and over 4 million die within their first month of life. Temperature regulation is a key problem among many of these infants.” The new question, that really got to what was needed, how to keep new borns warm and at a consistent temperature? The solution: “A baby warmer that looks like a miniature sleeping bag that incorporates a phase change material, which stays at a constant temperature for up to 6 hours. This low-cost solution maintains premature and low birth weight babies’ body temperature to help them survive and thrive.” This idea would most likely not have occurred based on the original assignment/question. Look at problems in different ways to come up with different possible solutions. And ask questions in a way without implying a prejudgment or that are negative. They ask questions in an open, positive and collaborative manner. “How might we…”

The bothers Kelley have a well organized and thought provoking book. Soon to debut on the New York Times best seller list. Many people could benefit from their approach and many of our challenges in the world could be better addressed though creative confidence. www.creativeconfidence.com

 

 

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Materiality: central theme of the Corporate Responsibility Officers Forum

Posted on October 14, 2013 by jeffhoffmanassociate

Last week I had the opportunity to participate in the Corporate Responsibility Officers Association annual forum in New York. It was nice to see old friends and meet new colleagues. The two day convening was titled “Good Business Makes the Difference.” My biggest take-a-way is the increasing importance of materiality to our work. Materiality has primarily been an accounting concept where all important matters are to be disclosed, meaning if it is of sufficient importance or relevance as to have possible significant influence on an outcome, report it. Increasingly social and environmental performance is influencing financial performance, but is often not measured. Not enough attention is currently being paid to social and environmental performance by both corporate boards and investors. But they should as it is increasingly having an impact on the bottom line, or will be in the near future. Right now, most social and environmental performance metrics, when reported, are done so voluntarily and are not mandated. There are efforts afoot to make them mandatory.

As reporting is central to materiality, a workshop was presented titled “GR4 vs. SASB: Should you put all your eggs in one basket.” In my April blog: Global Reporting Initiative: North-American G4 Campaign Kick-off, I discuss the new version of the GRI. “The Sustainability Accounting Standards Board™ (SASB™) is a 501(c)3 non-profit that provides standards for use by publicly-listed corporations in the U.S. in disclosing material sustainability issues for the benefit of investors and the public. SASB standards are designed for disclosure in mandatory filings to the Securities and Exchange Commission (SEC), such as the Form 10-K and 20-F. SASB standards will result in the improved performance of 13,000+ corporations, representing over $16 trillion in funds, on the highest-priority environmental, social and governance issues.”

SASB is focused on an industry; GRI is focused on a company. SASB reporting aspects: Environmental Capital, Social Capital, Human Capital, Business Model & Innovation, Leadership & Governance. GRI focuses on aspirations: Environmental, Human Rights, Labor Practices, Society, Product Responsibility, and Economic. Some say the two will be complimentary, some say competitive. Time will tell, but one thing is for sure, most companies are suffering from reporting fatigue.

Herman Mulder, Chair of the Global Reporting Initiative, said that “what is now voluntary will probably be regulated. “In Europe in particular, we are moving in that direction. Progression of sustainability is being held back by fear of liability. “Reporting is not done for the process; it’s a reflection of the effectiveness of your strategy.” He gave a sobering talk titled: “Another Crisis is Looming Around the Corner.”

Ending the first day was an interesting presentation by Georg Kell, Executive Director of the UN Global Compact. The United Nations Global Compact is planning for the transition from the Millennium Development Goals to a post 2015 architecture. Kell said that “long term successes of businesses are deeply connected to the markets where you operate. “Looking at the business sustainability aspects of what will eventually replace the MDGs will involve shared value. “Short term versus long term is a challenge with companies but the issues and potential for rewards need a long term strategy.” 8,000 companies from 140 countries have joined the Global Compact. The goal us to get to 20,000 to really begin to see change in key markets. There are 10 principles of the Compact covering four areas: Human Rights, Labor, Environment and Anti-Corruption.

The presenters from BrownFlynn did a nice job illustrating the progression of corporate responsibility approach over the decades:
Contributions: Philanthropy → Time & Treasure → Creating Shared Value.
Financial Focus: Compliance → Environment, Health & Safety→ People, Planet, Profit
Communications: PR → Transparency → Collaboration and Innovation
Reporting: Financial Reporting → Sustainability Reporting → Integrated Reporting
CR Program Focus: At Company Direction → Quality over Quantity → Materiality

The 2013 Responsible CEO of the Year awards were presented to Marilyn Hewson of Lockheed Martin, Denise Morrison of Cambell Soup Company, James Murren of MGM Resorts International, Patrick Prevost of Cabot Corporation and John Veihmeyer of KPMG LLP. Lifetime Achievement in Philanthropy was presented to Dan Hesse, CEO of Sprint and my longtime friend and colleague, Charlie Moore, retired executive director of CECP, Committee Encouraging Corporate Philanthropy. In her remarks, Denise Morrison said that we are “committed to making a profit and making a difference.” This was certainly the spirit of the conversations at the Forum.
http://croassociation.org/ www.sasb.org www.globalreporting.org www.unglobalcompact.org

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“Philanthropy as Scaffolding, It helps Shape the Re-building.” Expanding Opportunities in America’s Cities

Posted on September 27, 2013 by jeffhoffmanassociate

“Expanding Opportunities in America’s Cities:  The Kresge Foundation Story.”  This was the title of yesterday’s Conversation on Philanthropy presented by the University of Southern California’s Center on Philanthropy and Public Policy (CPPP).  It was really two conversations, one on strategic direction change within a foundation and the other on  Detroit.  I’ll cover both, but focus on Detroit.  The two panelists are fascinating in their own right.  Rip Rapson is President and CEO of The Kresge Foundation and has a distinguished career in philanthropy and public service.  Irene Hirano Inouye, (a fellow CPPP board member) is the President of the U.S. Japan Council, was chair of Kresge when Rip was hired and is on the board of the Ford Foundation.

The Kresge Foundation was established in 1924 by Sebastian Kresge (the “K” in Kmart) .  “For more than 80 years, his mandate to promote human progress was realized through the support of fundraising campaigns (through challenge grants) to build capital projects – libraries, hospitals, schools, museums, community centers and the like.”   By 2007, there was a sense that the foundation could make a bigger impact through a different direction.  Irene said that the board was committed to change, but didn’t know what it looked like.  So they searched for a new CEO that could work with the board in the evolution.  They hired Rip and the transformation began.  It would be “fundamentally disruptive” to drop the capital challenges.  They needed a gradual shift.  Kresge is a strong brand and had helped build many needed projects across the country.  The decision was how to balance the capital projects with new initiatives.  Rip said that “grants alone are not sufficient to make long term change.”  The goal was to be closer to mission with a commitment to low income communities in urban areas.  Today the foundation works to expand opportunities in America’s cities through grant making and investing in arts and culture, education, environment, health, human services and community development.

It is their place-based strategy in Detroit that caught my attention.  We hear a lot about Detroit in the news, and just when it seems things are turning around, there is a scandal with the mayor and then bankruptcy.  Metro Detroit is Kresge’s home town, so when changing their strategy, Detroit became a higher priority.  The Kresge board asked themselves “are they a holding company (referencing their support for desperate organizations and causes) or are we a unifier.”  Being a unifier, and integrator, is core to their Detroit work.  This is where the pivot from traditional grant making comes when they decide to be actively involved in problem solving.  They used their influence to help the community move forward.  They helped lead a three year reimagining, looking at 11 different components from land use, to mass transit and education.  Participants were from government, business, nonprofits, philanthropy and the public.  Each one of the components had a “blueprint.”  The result, the Detroit Future City Plan.  The goal was to answer this question “What do we need for the long term health of this community?”  Rip said something profound, “Philanthropy put in place the scaffolding to pull together and help shape the rebuilding.  But scaffolding is not permanent, it’s what is built inside that lasts.”  He made one last statement, “Embrace collective action!”   http://kresge.org/ http://detroitfuturecity.com/ http://cppp.usc.edu/

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Reimagining

Posted on September 3, 2013 by jeffhoffmanassociate

We live in an evolving world.  In order for us individually, and as a society, to be successful, we must re-imagine.

    Magic Johnson re-imagined himself from a basketball player into an entrepreneur.

Father Gregory Boyle re-imagined a program to get youth out of gangs into a thriving social enterprise.

  • Walter Knott re-imagined a boysenberry farm into an amusement park.
  • Arnold Schwarzenegger re-imagined himself from a body builder, to actor, to Governor and back to actor.
  • Henry Kaiser re-imagined cement to ships to healthcare.
  • Sheryl Sandberg re-imagined herself from the Treasury Secretary’s Chief of Staff to the COO of Facebook.

Change is both scary and exciting, but if we don’t change, we risk becoming irrelevant, redundant and not equipped to fully participate in the world around us.

Reimagining was the topic I was asked to discuss in my keynote address at the opening session of the California Workforce Association’s Annual Conference.  Today, I talked about how I have evolved throughout my career, the opportunities I had to help The Walt Disney Company re-imagine itself and how businesses are reimagining themselves for social and environmental good.

The business world has and is reimagining itself in so many ways.  How can we re-imagine a structural change where all components of society are working together for the greater good?  Global competitiveness, economic vitality, poverty alleviation, environmental sustainability, good paying jobs, healthy citizens, civic participation, educated population, quality of life and world peace.  All of these are interconnected and interdependent.  Unfortunately many governments, nonprofits and businesses function as if they are separate, and as a result we have some serious structural issues that need to be fixed.  Shared Value, Corporate Social Responsibility, Philanthropy and Skills-Based Volunteering are some of the strategies and tools working towards a more integrated approach to problem solving.

From time to time we should take out a blank sheet of paper and put down what we want to be, and what we need to be.  Then work backwards on how we will get there.  And get there working collaboratively, efficiently in an intelligent manner.  Life is too short not to re-imagine how we can be better, and society can be better.  The world is depending on each of us!  http://www.calworkforce.org/

 

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