The new business imperative: social impact selling

This past year has been one of enormous challenge for each of us personally, as organizations, and as a society. It’s also been a time of growth, resilience, and learnings – demonstrating how truly connected we are when it comes to societal issues. The events of the last year have reinforced that we are all dependent upon and connected around access to quality healthcare and education; the need for resilient, secure, and remote government services; the imperatives of a solid job market, with capital-infusion to stabilize our economy; and the national reckoning on racial justice and equity.

For organizations like Microsoft, this year underscored the need and the opportunity to look beyond our own business objectives to positively impact social outcomes. With so many societal challenges in front of us, how do we come together to tackle them and effect positive change?

Civic Tech: a model for societal impact

I’ve had many recent conversations about doing business with a purpose-driven mission and how we, as corporations, can align our actions to help solve the world’s biggest challenges. Knowing that technology will be the underpinning of a successful global society, I believe that the technology community has a responsibility to build social impact into the fabric of our business models and cultures. I refer to this as “civic tech” (the intersection of ‘tech intensity’ and social impact).

My team is partnering with The Global Good Fund to learn how to create positive transformation in the communities where our employees live and work; to develop employee social impact acumen; and to advance societal goals with our partners and our customers. Social impact selling enables you to engage with customers and partners in new ways, perhaps even opening doors that were previously closed to you, as you come together around shared values.

As a company, we are tackling big societal challenges like inclusion, sustainability, fundamental rights, and trust. This includes large scale investments aimed at digital skilling, broadband access, racial injustice, and climate action. We are also committed to help in the following ways:

• Affordable Technology Solutions. Through our social impact selling efforts, we also work closely with nonprofits to create purpose-built solutions on technologies across our product stacks. We’re committed to helping nonprofits get access to best practices, reference architectures and faster data insights.
• Capacity Building. Just delivering technology isn’t the whole answer. We recognize that capacity building is often the key to successful adoption of new digital technology. That’s why we are committed to helping organizations get access to training and certification to improve their digital skills.
• Microsoft Partner Ecosystem. We also leverage our tens of thousands of commercial partners to create a healthy ecosystem of partners dedicated to delivering solutions and services designed specifically for the nonprofit sector.
• Social Investment Model. We not only provide technology grants but also reinvest any profits made from discounted sales to larger charities back into the sector to help smaller ones. We also provide free software to those with 10 or fewer employees, which make up 80% of the world’s 4 million nonprofit organizations.

Doing good is good business.

There is plenty of research that indicates doing good is good for business. Creating meaningful social impact should help, not hurt, your bottom line. When you are engaged in efforts to tackle society's biggest challenges, there is a goodness that accrues back to your overall business - specifically driving mission and margin.

Substantiates Brand + Builds Demand. While there is no question that it is the right thing to do, creating a positive social impact also helps to set you apart, and builds trust in your organization. People consciously, or subconsciously, want to favor companies that are acting ethically – in ways that are authentic to their business models. It has been proven time and again, that this substantiation of an organization’s brand and its values through social impact, builds awareness and demand for your products and services in consumer and commercial markets. It may even help to create new revenue streams.

Lift + Shift to New Revenue Streams. When organizations lead with curiosity and create a culture that is focused on learning, we tend to see new opportunities emerge. Ecolab, a leading global provider of water, hygiene and energy technologies and services, is a Microsoft customer and a partner that has its roots in cleaning products for dishwashing machines, aimed at protecting public health.

Today Ecolab is using data and technology to help its customers be more water efficient and use less water across their operations. The data Ecolab collects from more than 42,000 connected smart water sensors around the world is used to make informed recommendations to improve processes and reduce water consumption. It leads to a “virtuous cycle” of less water, better results, and much lower operating costs. Using our technologies, Ecolab is accelerating net zero water usage around the world in sectors including energy, agriculture, food and beverage, manufacturing, and hospitality – driving a successful business model around sustainability.

Talent Attraction + Retention. Often overlooked is the impact on your employee culture and ability to attract new talent. In a study of 5,000 respondents by Glassdoor, 77% of people would consider a company’s mission and culture before applying for a job there, and a Cone Communications study found that 75% of millennials would be happy to take a pay cut to work for a socially responsible company.

Companies that incorporate social purpose help galvanize and energize employees in new ways, creating different career paths, and ultimately contributing to employee satisfaction and retention. During the early months of the pandemic, a Bain & Company survey found that among employees whose satisfaction with their company had increased, 86% reported that their employer has a purpose that its people are passionate about and find meaningful.

The Bottom Line

In addition to attracting employees and customers, there is growing market evidence just how important social impact has become to investors. In a 2018 global survey by FTSE Russell, an index provider, more than half of global asset owners were implementing or evaluating environmental, social, and governance (ESG) considerations in their investment strategy. And when the pandemic hit, investor preferences toward sustainability skyrocketed. According to BlackRock, U.S. sustainable funds attracted a record USD 7.3 billion in the first quarter of 2020.

Data also points to the direct correlation between sustainable practices, share prices, and business performance. Bank of America Merrill Lynch found that firms with a better ESG record than their peers, produced higher three-year returns, were more likely to become high-quality stocks, were less likely to have large price declines, and were less likely to go bankrupt. BlackRock’s research also indicates that, in the current crisis, companies with a record of good customer relations or robust corporate culture are demonstrating resilient financial performance.

Today’s technology leaders have a tremendous opportunity to help carve out a new future with their customers and partners that is both good for society and the bottom line. Although knowing that your efforts are empowering employees to help our society thrive into the future, is the most rewarding benefit of all!