What does it take to really sink a Mission-Driven business – or, at the very least, substantially diminish its success? Let’s look at five big pitfalls that too often threaten companies that promote their purposes – and how to ensure you survive them.
Pitfall #1: Changing the Mission at the Expense of Your Customer
Netflix had basically bankrupted Blockbuster by making movie rentals by mail easy, automatic and affordable – no late fees and no late-night trips to the store to make a return. At the same time, Netflix had its eyes on the future; they didn’t want to get blindsided by technology the way Blockbuster had, so they started a streaming service which DVD subscribers received as part of their monthly fee. It took off quickly. They correctly saw that streaming was where their business would ultimately end up and, in October 2011, they announced they were spinning off their DVD service into a separate company so they could purely focus on their internet offerings.
What seemed like a sound business decision felt like betrayal by its customers, who suddenly had to pay almost twice as much for the same DVD/streaming combo package they had had in the past. Even though changing up its strategy was the smart move, the abrupt left turn was too much for its customers to handle at once. The company ended up cancelling plans to spin off the DVD rentals into a separate enterprise. Subscriber anger cooled and soon the company roared back stronger than ever.
How to Power Past this Pitfall
There’s certainly more long-term danger in not changing up a business mission when necessary. Netflix had only to look at the ruins of Blockbuster to see what happened when you failed to keep up with technology. But Netflix was too anxious to avoid the mistakes of its predecessor – it not only abandoned its core business too quickly, it also made the mistake of increasing the cost of the service its customers were getting by an alarming 67{cd266c1509fca34f59dc93da7daf12a6ee52c6401aabb2126e757d9de7c223fc}.
Instead, when you are in the midst of changing missions, make it a lengthy transition – and make your customers feel as little of the pain as possible. Don’t inconvenience them or overcharge them for a changeover that’s your responsibility to pull off – or they’ll resent you for making your problem their problem.
Pitfall #2: Pursuing an Outdated Mission
This was the pitfall Netflix was trying to avoid when it ran into the other one instead. Times change, cultures change, and technology changes – and if your organizational mission doesn’t change as well, what brought you huge success in the past might bring you nothing but misery in the future.
How to Power Past this Pitfall
Blockbuster had many opportunities to adapt to changing times – but did too little too late. When a company owns a certain sector of an industry, it all too easily can fall into complacency, believing its dominance will weather any storm. That’s why it’s important to continually analyze your business mission and ask questions such as:
- Is our mission still relevant?
- Is the marketplace changing in such a way as to render us obsolete?
- Are consumers beginning to view us as old-fashioned and out of step?
- Is someone else fulfilling our mission in a newer, more efficient and/or more exciting way?
Pitfall #3: Diluting Your Mission
JetBlue was founded with a very distinct mission in place “to bring humanity back to air travel.” That was fulfilled by charging less than the big airlines but, at the same time, offering such extra amenities as a TV at every seat. It became so successful that other airlines tried (and failed) to emulate it.
However, after a few years, JetBlue ran up against some strong headwinds from the marketplace. The new CEO, not overly concerned that the airline built its brand on a customer-friendly philosophy, began adding more seats to planes, increasing crowding, and charging more for snacks and luggage, increasing the expense to its fliers. That, of course, upset those customers who were faithful to the company because of its mission.
How to Power Past this Pitfall
Perhaps JetBlue did have to make those tweaks to its business in order to keep the company healthy. But it could have found other ways to deal with the situation. Actions speak louder than words – and when the actions directly contradict the words, your public image takes a big hit.
First, JetBlue should have said it was regretful that these moves were necessary. Second, JetBlue should have found some ways to sweeten customer experience in more cost-effective ways – something that would have been a significant gesture of good will to frequent customers who would feel the pain of the economizing. Finally, they should have heeded a piece of advice we offered earlier: Don’t change too quickly. When everything gets bad at once, people really stand up and take notice.
Pitfall #4: Violating Your Customers’ Values
Lululemon was founded to provide upscale yoga-fitness apparel for women. The company was a huge success. However, its founder, Chip Wilson, generated a lot of controversy. For example, he stated that he named the company “Lululemon” because it was hard for Japanese people to say, so they would have to make an extra effort when marketing it in their country. But, he really began to get in trouble when he said his company doesn’t make clothes for plus-size women because it costs too much money. And he also blamed excessive pilling in Lululemon pants on that segment of the buying public as well.
His remarks caused the company’s stock value to plummet by a third – and forced Wilson to resign as CEO. Now, none of what Wilson said had anything to do with the company’s actual business practices, but they did offend the sensibilities of his main target group – women. He violated their values and caused tremendous damage to the brand.
How to Power Past this Pitfall
An organization’s management must be careful with public remarks and their own personal actions. If a representative of a company says or does the wrong thing, it immediately causes negative repercussions throughout social media especially. That’s why control is so important to a Mission-Driven business. It has to be careful who it hires, which vendors it does business with and what its own leaders say and do (behind closed doors and in the public spotlight).
When this kind of mishap does occur, however, a sincere apology should come quickly and steps should immediately be taken to compensate for the damage (a big charitable contribution to a relevant cause, for example). Sometimes this isn’t enough, however, and the person involved must be let go.
Pitfall #5: Violating the Mission
For 31 years, Sharper Image sold high-end electronics designed to appeal to men with a lot of disposable income. But in 2002, Consumer Reports published a report that stated one of Sharper Image’s air purifier products released unhealthy levels of ozone. In other words, it did the exact opposite of what it was supposed to do. Sharper Image tried to sue Consumer Reports for libel, but the suit was dismissed. The company was forced to accept massive amounts of returns on the product, including units that were many years old. The merchant finally ended up filing for bankruptcy in 2008.
There is no bleaker scenario for a Mission-Driven company than to actually end up doing the opposite of what it sets out to do. The resulting Sharper Image controversy not only cost the company millions of dollars in returns and lost sales, but also broke trust with the public.
How to Power Past this Pitfall
When something serious happens to derail your mission, you must take swift action and do whatever it takes to restore trust. That can mean doing things that seem to be insanely overboard – but it’s better to do too much than what will be perceived to be too little by the public. When you do the opposite of what you promise, it threatens your very viability as an organization. Therefore, no action is too extreme to make things right again.
As you can see from what we’ve discussed, a mission can be a very fragile commodity. But if you remain true to your stated objectives and consistent in implementing them throughout your business practices, your mission should grow and thrive along with your profits.
