As a result of the previous approach, a concept that goes beyond social responsibility, philanthropy and even sustainability is increasingly being coined more forcefully. It is about the shared value that, as Porter and Kramer define it, focuses on identifying and expanding the connections between economic and social progress. In this way, the generation of business-economic value is related and depends on the creation of value for society.
But how do you create shared value? There are three different ways to do this: Reconcibiendo products and markets, redefining productivity in the value chain and building support clusters for the sector around the company’s facilities: “Each is part of the virtuous circle of value Shared Increasing the value in one area increases the opportunities in the other “.
The essence of Porter and Kramer’s theory is that capitalism has failed to address the most important needs of society, such as health, welfare generation, nutrition, protection and environmental preservation. For this reason, and even though companies have sophisticated their products, companies have lost opportunities for innovation and growth by losing focus on the real needs of society. It is necessary, and almost indispensable, then, to rethink products and markets, because “to meet needs in underserved markets, redesigned products or different methods of distribution are often required. These requirements can trigger fundamental innovations that could also have an application in traditional markets “.
and redefining productivity in the value chain is to understand that “society’s problems can create economic costs in the value chain of a firm.” For this reason it is urgent to internalize these problems and to serve them: in order to benefit the society and the company. Companies like the British retailer Marks & Spencer or Nestle have found that making investments to strengthen local suppliers, in the long run they can get high quality raw materials in their operating areas.
Local vendor systems bring business benefits such as reduced transportation costs and supply times. And among the social and collective benefits are highlighted: the reduction of carbon emissions by reducing the needs of mivilidad, and contributing to economic development communities, generating greater recognition of the brand by having a relationship Closer to the community. Wherever you look at it is a win-win relationship.
On the other hand, cluster construction improves the company’s productivity because “capable local suppliers encourage greater logistical efficiency and easier collaboration. Having stronger local capacities in areas such as training, transportation services, and related sectors also raises productivity. And conversely, productivity suffers if there is no support cluster. ”