Goals and

values

Cristina Boari B.S. 2021-22

Goals and values
● Return on investment as strategic goal of a firm (Sloan, 1930s)
● Goals as the desire and the need to create value for the customer
(Grant, 1990s).
● Unique value: The reason a firm wins with customers or the value
proposition it offers to customers, such as a low cost advantage or
differentiation advantage or both (Dyer & al. 2020s).
Elizabeth I owned
silk stockings but the
“capitalist
achievement” does
not lie in “providing
more silk stockings
for queens but in
bringing them within
reach of factory
girls.” (Shumpeter)

Cristina Boari B.S. 2021-22

Value for
Shareholders Stakeholders
● Firm as a nexus of contract ● Customers, suppliers,
● Economic profit as surplus employees, money lenders,
○ Net operating profit after landlords, government,
tax− Cost of capital owners, society
● Maximizing profits and the
value of the firm
● Challenges:
● Challenges ○ Complexity
○ short-termism, financial manipulation, ○ Conflicts
excessive CEO compensation, and the ○ Slow decision making
failures of risk management
Tesco faces investor backlash over ‘role in UK
obesity crisis’ (10 February 2021)

A coalition of institutional and retail investors, coordinated by NGO

ShareAction, have filed what they claim to be the first health-based
shareholder resolution at a FTSE100 company. They are calling on Tesco, the
UK’s largest food retailer, to set targets to increase the proportion of healthy
products in its sales mix.
The resolution, filed by seven institutional investors managing over £140bn
in assets, reflects ‘rapidly rising investor concerns’ over the health impact of
companies, a topic that in the past has largely been seen as a fringe issue.

Cristina Boari B.S. 2021-22

Values beyond profits
● Universities, Hospitals, ONG, etc.
● Corporate social responsibility in for-profit organizations
with impacts on:
○ Reputation
○ Legitimacy to operate
○ Redistribution of created value
Values

● (a) concepts or beliefs,

● (b) about desirable end-states or behaviors,
● (c) that transcend specific situations,
● (d) guide selection or evaluation of behavior and events,
and
● (e) are ordered by relative importance (Schwartz and
Bilsky,1987)
 «I have a dream of helping to better all
colored women»
«I want you all to be just like me,
First female self-made millionaire in America independant, self-sufficient business
Many of her company's employees, including those in key management
and staff positions, were women women»
Fostered women entrepreneurship.
August 1910 : 950 sales agents and thousands of clients
Cristina Boari B.S. 2021-22
Strategic functions of values

● Values as Attentional Structures

● Values as Valuation Lenses
● Values as Design Principles
● Values as Identity Makers