“Understanding the purpose for which the company exists and the purpose beyond profits are two key aspects that companies will have to embrace to serve future customers sustainably,” stated the Partner – Consulting of Ernst & Young Sri Lanka Arjuna Herath, during a recent interview on LMDtv.

He acknowledged that “today’s customer is a very mindful consumer who’s well informed, clearly knowledgeable, and sensitive to the internal and external environments. This mindful customer is fully aware of the options available relating to consumption of or procuring services.”

With regard to positioning, he asserted that companies must be sensitive and understand customers’ needs – and find solutions to serve around those sensitivities. Herath elaborated: “Sustainability concepts and the aspects that consumers were sensitive to at one point in time are now changing to an affordability issue, given the current economic environment.”

“Sustainability of the company’s future depends on how it integrates and embeds sustainability concepts into the business,” he said, and went on to explain that it’s crucial to foretell challenges like the COVID-19 pandemic and economic crises.

Herath said that it’s important to “have shared value across the value chain, and work towards alleviating constraints to allow customers to continue consuming without interruption. Shared value means policies and operating practices that enhance a company’s competitiveness, while advancing the economic and social conditions in the community it serves.”

All stakeholders in the value or supply chain are considered stakeholders in a shared value system. Many businesses that provide goods and services to consumers also employ the shared value philosophy, which emphasises the importance of addressing broader social and environmental problems.

Further, this opens opportunities for large-scale innovation and expedited problem resolution. “Reinventing and innovating with the concepts of purpose and shared value along with finding solutions to address challenges that the consumer is facing” are very important, he noted.

In his view, organisations can mitigate the exodus of talented workers that they are seeing now and employees will be more willing to endure a temporary stress test situation if they understand the purpose of the organisation.

Citing the ‘open book concept’ as an employee management tool, Herath explained that with open book management, all employees are given access to the company’s financials – e.g. accounts, budgets and forecasts – and encouraged to offer their inputs into strategic decision-making on a par with managers.

And on employee empowerment, he said: “Share information and make them part of the decision-making process based on that information, and hold them accountable and reward them. You can actually make them shareholders. That’s a classic example of having employees engaged, and really being part and parcel of the organisation – and empowered.”

As to his expectations of Budget 2023, he spoke of the credibility of the government. To strengthen the integrity of raising taxes, the financial services professional counselled that the government must rationalise its expenditure so that people could support its efforts to recover from the existing dire situation.

Referring to the conduct of professionals, he counted the ability to control one’s behaviour morally, to remain faithful to one’s ideals and to present oneself with dignity in society as being necessary traits as professionals serve as society’s torchbearers.

In concluding his interview, Herath reiterated the true purpose of a business entity: “The licence to operate as a company is granted on the basis that you will serve society and the community… the purpose of businesses has to go beyond profits. You will make good profits sustainably if you link yourself to purpose, shared values and employee engagement.”