This column is part of Globe Careers' Leadership Lab series, where executives and experts share their views and advice about leadership and management. Follow us at @Globe_Careers. Find all Leadership Lab stories at tgam.ca/leadershiplab
Successful entrepreneurs understand that building a business is all about establishing long-term, meaningful relationships with customers. Relationships mean loyalty, and they enable the kind of honest feedback required to continuously improve your products and services.
The challenge for many entrepreneurs, however, is coming up with a compelling reason to connect with customers beyond the mere transactional relationship of selling them a product or service.
One of the best ways to make a lasting connection is to make products that are designed not only to appeal to customers, but also to do good. In fact, social good and a healthy bottom line are often linked.
How can you go about doing good while benefiting your business? By taking these three steps.
1. Find a big problem to solve
Look around for the really big problems that your customers are facing. If you can find ways that your business, and its products, can help solve these problems, you will have a much better chance of establishing a lasting relationship with your customers.
For example, over the past two years, we've dug into why small business survival rates are so low in Canada. According to Statistics Canada, 85 per cent of new businesses survive their first year, but only 49 per cent make it to their fifth anniversary.
2. Identify the barriers to success
We decided to find out why. We used customer feedback and extensive research to look into the key obstacles to small business success in Canada. Our research found that a lack of financial literacy skills is a major reason for these low survival rates. We also found that the No. 1 regret of small business owners is not mastering financial management early in their entrepreneurial career, and 57 per cent of them still use pen and paper for keeping records.
We had identified the problem, but the question remained: How could we make a meaningful difference? How could we establish shared value between solving this big problem and meeting our own business goals?
3. Take action
We decided to start at the beginning, with Canada's youngest entrepreneurs. Through further research, we discovered that millennials – individuals born between 1980 and 1995 – are twice as likely as the average person to want to start a business in the next year.
Armed with this knowledge, we've partnered with organizations like Startup Canada and Futurpreneur Canada (formerly known as the Canadian Youth Business Foundation), and built programs aimed at boosting financial literacy among the entrepreneurs of the future. This is how we're creating shared value: By increasing their chances of survival, we ultimately achieve our business goals.
This is what shared value is all about. In order to build long-lasting relationships with stakeholders, businesses need to look for ways to do good and simultaneously boost the bottom line.