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ABC: the formula for organisational success

Posted on by from London School of Business and Finance

How can a simple ‘ABC formula’ help lead your company to success? Professor Maurits van Rooijen of London School of Business and Finance, reveals, and explains how your business can use it to encompass aspiration, organisation and community building.

The success formula for a well-balanced, sustainable organisation is a fundamental ‘ABC’, with each letter standing for an important business concept that will help you run your business effectively.

A: Aspiration

What do you want your organisation to contribute to society? What are its objectives in terms of impact and reputation? What makes it exciting for you and for your clients?

B: Business

At the same time, you need to consider B: the business side of your organisation. An organisation prospers because of investments, donations and payments.

If your commercial imperative overshadows your societal ambitions, your business may begin to represent 'the ugly face of capitalism', and is unlikely to achieve a lasting success. It makes perfect business sense to aim at a monopoly status – but for obvious reasons, monopolies are unacceptable. A classic example is how, quite rightly, public authorities have stepped in to regulate the excessive behaviour of banks.

How A and B can work together

Any organisation, large or small, start-up or mature, should have both an A and a B. The truth is that, if only for social acceptance and long term viability, a commercial organisation needs to balance both concepts.

For those working in charities and public institutions, A can overshadow B; yet these organisations need to be financially sound and managed in a way that is as efficient and effective as any for-profit organisation. Wasting the money of donors and tax payers is not only immoral, but in the long run it could make your organisation unsustainable. As a result, a lack of B reality will kill the A ideals.

When done well, the balance of A and B will reinforce each other: A normally requires funding to generate a good reputation, and a stronger reputation makes it easier to generate more revenue.

Therefore, a strong A ensures a stronger B, and a strong B helps to strengthen A. If well managed, an organisation can enter into an upward spiral; with weak management, a downward spiral can be triggered with far less effort and much faster.

C: Communities

Many business leaders often forget this part of the success equation. I define communities here as anyone that has a noticeable emotional relationship with an organisation or its products / representatives.

So, an employee who works for your company from 9 to 5 is not necessarily a member of the community: though there is clearly a business relationship, it is not necessarily emotional.

As another example, someone who studies at a college might not feel a strong emotional attachment. If there is a sense of loyalty, then a community can emerge.

Building communities is often linked to the clarity of A, since in many cases a strong reason for emotional attachment is values. This is why being a good leader plays a major role in this aspect.

Creating a community – i.e. establishing a relationship that goes beyond rationality – is crucial for your impact and credibility.

Supporting A, B, and C

It is the main role of any organisational leader to express aspirations and values, typically in emotional terms and tone, and create and strengthen ties with various communities. This is the real secret of lasting success. This will be an uphill struggle if an organisation is badly managed, lacks credibility in business terms, or lacks any sincere interest in society other than share prices or profit levels.

An optimal alignment of A, B, C is the most powerful way to ensure lasting success, and this is where the organisational leader should have their primary focus. As always with leadership, it is not necessarily about doing it, but rather about making sure that it is being done effectively and efficiently.

Anyone can assess the organisation they are involved with against this basic ABC formula: I certainly do so frequently, and it allows me to focus my mind on my organisational priorities.

Ultimately, the ABC formula is the same for the public and private sector – although the methods are different. By applying this equation to your strategy, you are more likely to put your business on the road to success.

Maurits van Rooijen

By Maurits van Rooijen

London School of Business and Finance

Professor Maurits van Rooijen is rector and CEO of London School of Business and Finance (LSBF), and chief academic officer of Global University Systems (GUS). He is an economic historian, specialising in the fields of globalised education and entrepreneurship. He is also the co-chairman of the World Association for Cooperative Education and the president of the Compostela Group of universities.

London School of Business and Finance

London School of Business and Finance

London School of Business & Finance (LSBF) offers industry-focused programmes designed to reflect global market trends. LSBF attracts candidates from more than 150 countries worldwide, and works together with its corporate partners to develop programmes structured with an up-to-date and international perspective in mind.

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