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by Stevenson Q. Yu
Proverbs 11:25
Whoever brings blessing will be enriched, and one who waters will himself be watered.
Many people think that being generous in business is a waste of money. Why should you treat people better and give them more than what is expected of you? They equate giving with losing. But is having a reputation for being generous and helping others really a bad business strategy? What does being generous in business mean anyway? To quote from a Forbes magazine article:1
It’s about being willing to give a piece of yourself or offering an invaluable gift of your time and expertise or extending your network to someone you care to have a relationship with. It’s about caring enough to make someone else successful first …
It’s about empowering those around you through a simple word of encouragement and inspiration at a time when it matters the most. All without expecting something back.
In short, it means you must treat others as human beings and be generous to everything you do and everyone you interact with. Not just to your employees and customers, but also to your business partners and even the community around you. Although you may feel that this is an unnecessary expense, it actually makes very good business sense today, when competition has shifted from price to service quality.
Take for example, the case of online shoe retailer Zappos. Founded in 1999 and later acquired by Amazon.com in 2009, Zappos, under its CEO Tony Hsieh, decided on a unique approach to both customer service and working culture – generosity!
The company has a reputation for dedicated employees willing to go above and beyond the call of duty to meet the needs of every customer and make them happy. Its free returns, generous 365-day return policy, and habit of surprising customers with random free upgrades from standard to overnight shipping, puts a smile on the face of customers. As Hsieh said in an interview, “The shoes may wear out, but they will always remember that feeling they got from the experience.2”
While these policies can be quite expensive and are strictly not necessary, Hsieh was maximizing the customer experience and not efficiency. In a Harvard Business Review article, Hsieh attributes Zappos’ growth due to investments of time, money, and resources into three key areas: customer service, company culture, and employee training.3
Many companies used the power of generosity to increase the power of their brand and the dedication of their stakeholders. Tom’s Shoes, which donates a pair of shoes to a child in a poor country every time you buy a pair of shoes from them.
Lego, which ranks second on the Reputation Institute’s “2019 Most Reputable Companies Worldwide,” made public commitments to protect the environment and practice ethical business.
Even Microsoft, which was reviled not so long ago as the “Evil Empire,” has a good reputation today because of the philanthropic practices of both the company and its founder Bill Gates, who has dedicated most of his $90 billion fortune to charity before his death.4
Endnotes
- Walter, Ekaterina. 2015. “Generosity as a Business Practice.” Forbes, February 18, 2015.
- Hughes, Frank. 2018. “Zappos CEO Shows Exactly Why ‘Doing Good Is Good Business.’” Digitalist, June 13, 2018.
- Hsieh, Tony. 2010. “How I Did It: Zappos’s CEO on Going to Extremes for Customers.” Harvard Business Review, July 1, 2010.
- Schwartz, Ariel. 2018. “Bill Gates Reveals the 2 Reasons He’s Giving Away His $90 Billion Fortune.” Business Insider. February 13, 2018.
(LinkS to Lesson 5 and lesson 7)
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