Loving (vs. Avoiding) a Business: One Formula

In the last week, I’ve learned:

• My credit card was charged an extra $20.50 for the “privilege” of buying a Greyhound ticket for our 16 year old niece to come visit from an hour away (base ticket < fees),
• My 5 year old deck is rotting thanks to a “protective” product we coated it with two summers ago, and
• The VW “clean” diesel we bought in 2013 to replace our dying Honda hybrid has been massively polluting the environment.

Am I angry? Yes. (Did my quotation marks give me away?)

But I’m also a businesswoman and my role at Aspen Institute encourages me to reflect on situations like this from the perspective of the business and its executives to understand what led to this result. Arm chair business philosopher, I should add to my LinkedIn profile.

I’ve come to understand that most businesses can only compete on two of three variables: Quality, Cost/ Price, or Service. But rarely all three at once. (Unless perhaps you cheat. And then we athletes and sports fans know to call foul – that’s not competing. I’m looking at you, Volkswagen.)

The businesses that I have learned to dislike, and thus avoid, are ones that offer an unsatisfying mix of quality, value, and service. My gut says they are run by humans who have lost touch with their own sense of humanity and fraternity. Something goes massively wrong in their product/ service delivery or quality promise once, or a firm just consistently under-delivers. Frugal Rebecca then feels cheated by the value delivered, and I stop doing business with this company, if at all humanly possible.

So what is going right with those businesses that I like – or even love?

Most of us find ways to live a productive, meaningful life. And that often means reducing routine decisions as much as possible (breakfast choice, what to wear, when to meditate and exercise, etc.) to leave our heads clear for creative thinking and willpower. For me, this includes the businesses I use for the routine, yet important, things in life.  

Businesses earn my trust through a combination of good quality, good value, and good service – perhaps one or two areas superlative to the others. Are the businesses and their products always perfect? Of course not. They’re composed of humans, like me, who are full of foibles. I hope my trusted “business friends” don’t fail me, but they have – or will. Yet in this equation of business, what distinguishes the companies I trust are the humans who provide the customer service AND the humans who create guiding policies and culture. The humans behind the brand are what brings me back after a mini-failure.  

My own views seem reflected in the wisdom of experts who invest in companies based on fundamentals. In a survey of well-regarded, long-term oriented investors in public companies that I’m currently spearheading at Aspen Institute, these long-term investors are most alarmed by news of a decline in customer satisfaction (100% are worried, even if financial results won’t show for 18+ months). Check back here for more on the final survey results when we finish research in early Q4.

So who do I heart? USAA, The Vanguard Group, Costco, Trader Joes, Chipotle, and Southwest are top of mind, along with some local businesses. A unifier among these businesses that have earned my trust? They all have a deeper purpose beyond just maximizing profits or shareholder value. This, I think, is their secret weapon. Each company has a purpose that seems to inspire their employees, and their management have figured out ways to ensure that purpose comes alive throughout the company.

Perhaps my business trust equation might be = Purpose * (Quality + Service + Price)?

I’m curious – what businesses have earned your loyalty, and why?

Rebecca K. Darr is a senior fellow with the Aspen Institute Business & Society Program and a co-owner of Atayne, a certified B Corporation, that designs and manufactures progressive outdoor & active apparel to drive positive environmental and social change.