June 20, 2011

Kudos and Gaffes: Creating Shared Value

Leadership Kudos this week go to my HBS colleague Michael Porter, whose article on “Creating Shared Value” in the January edition of Harvard Business Review represents a turning point in the relationship of business to society. In the article Porter observes that, in pursuit of maximizing short-term shareholder value, business has often operated in opposition to society’s interests, leading to regulatory limitations on its actions. Porter argues persuasively that business needs to operate insync with society, leading to many more opportunities for the private sector by creating new markets and, ultimately, far greater shareholder value.

Leadership Gaffes go to President Obama’s National Labor Relations Board (NLRB), which is blocking start-up of Boeing’s new $1 billion plant in South Carolina to produce its most important new aircraft, the 787 Dreamliner, for which Boeing has already received billions of dollars in orders for exporting the plane to foreign airlines as wellas domestic. Ironically, President Obama appointed Boeing CEO Jim McNerney as co-chair of his export council with the goal of increasing U.S. exports. Boeing has already hired its first 1,000 of an eventual 10,000 employees, and hired an additional 2,000 in Seattle. Does the Obama administration’s left-hand know what the right-hand is doing? Is anyone in the White House serious about jobs?