TAB survey outlines advantages enjoyed by socially-driven companies

The March 2015 Small Business Pulse Survey conducted by TAB (The Alternative Board) has been released, and its findings outline the advantages enjoyed by socially-driven companies revealing that they tend to be more optimistic, ahead of their competition and united by a stronger personal vision.

The survey involved 350 participants from five countries: United States, Canada, United Kingdom, New Zealand and Ireland. The study defined socially-driven companies as those who answered “strongly agree” to the question “My company is built around positively contributing to society”. Thirty-eight percent answered “strongly agree” to this question.

TAB also defines socially-driven companies as those “…which focuses on its people,” according to a release.

A write up of the survey identified some key differences between companies that identify themselves as socially-driven and those that do not, for example, “There may be a perception that owners of socially-driven companies are run by younger owners. That’s not true. In fact, the average owners of socially driven companies (57.1 years) is slightly higher than those of other companies (55.1 years).”

The survey’s write up also states that there appears to be a misperception that socially-driven companies only exist for the greater good and aren’t interested in profit. Participants had the option to state which option best described their company out of “a business for good”, “a business for results” and “a business for profit”. Seventy-five percent of socially-driven businesses were “for results” or “for profit” compared to 42 percent of other businesses.

TAB vice president David Scarcola said “Socially-driven companies seem to place an increased importance on human connections and relations. They listen closely to what stakeholders are saying, but don’t neglect their employees or customers. It can be a difficult balance for other businesses to strike, but it may also be the key to a better overall sense of purpose and a more confident approach to doing businesses.”

Another finding was that socially-driven business owners appear to be more optimistic, “When we asked respondents about how their revenue changed over the past year, the results for socially-driven companies and other companies were very similar. But, when we asked them 'In one year from now, how do you anticipate your sales revenue changing?' the results were substantially different.”

According to the results, nearly twice-as-many socially driven business owners expected revenue to sharply increase (26 percent) compared to 14 percent of other companies.

Overall, all types of businesses expect to grow revenue in the next year, 89 percent of socially-driven companies expect to grow revenues compared to 83 percent of other businesses while only two percent of socially-driven respondents anticipate a decrease in revenue over the next year while 10 percent of other business owners anticipate a decrease.

Business owners were also asked “Today, how is your company faring against the competition, overall?”. Forty-eight percent of socially-driven companies selected “ahead of the competition” compared to 38 percent of other companies. Only five percent of socially-driven companies felt they were “behind the competition” compared to 12 percent of other companies.

The survey also showed that socially-driven owners may have stronger personal and business visions. Twenty percent of socially-driven owners selected a 10 on a scale of 1-10 when asked “how would you rate your own personal vision and sense of purpose” compared to seven percent of other owners. Other owners more commonly selected seven or eight for the strength of their personal vision.

Nineteen percent of socially-driven owners selected a 10 when asked “how would you rate your own company’s vision and sense of purpose” compared to five percent of other owners. Other business owners once again more commonly selected 7 or 8 for the strength of their company vision.

Scarcola said “A clear personal vision is an excellent motivator for success – especially when shared with others. By aligning their vision with their people, socially-driven business owners are held further accountable to their goals.”

One of the strongest differences in the survey was the response to the statement “My company is a fixture in the communities that we serve”. Forty-five percent of socially-driven companies selected “strongly agree” compared to 16 percent of other businesses.

When the participants were asked about what best describes how they achieve success, 65 percent of socially driven companies selected “by emphasising human connections and relations” compared to 59 percent of other businesses.

According to the survey’s write up “…a majority of both types of businesses selected this option over the “setting goals and accomplishing tasks”. This reflects the importance that all owners place on their employees, customers and partners.”

More socially-driven companies “strongly agree” with the following statement (85 percent) than other businesses (69 percent), “My company pursues win-win relationships with customers, employees, partners and other key stakeholders”.