BGI has an “Entrepreneur in Residence” when we’re there, someone who has run a business and has lots of experience to share. For the October Intensive our guest was Dal LaMagna, also known as “Tweezerman”. It may sound a little funny, but Tweezerman was big business and he sold the company in 2004 for big bucks. He was a fascinating speaker with lots of stories of building the business. He also cared seriously about social responsibility before it became a buzzword. He believed basically in being honorable and treating his employees, customers and suppliers well. He focused on communication with all three. With employees he believed you had to let people make mistakes and grow. Dal also believed in rewarding them – he distributed 20% ownership of his company to employees through ESOP and bonus programs and was very proud that after he sold the company he personally wrote a check to each one, distributing over a million dollars since there were 200 of them. With his customers Dal first gave them an unconditional lifetime guarantee for the product – if your tweezers ceased to satisfy you could send them back and they’d be refurbished. The company also supported causes that were meaningful to the customer base like breast cancer awareness. With suppliers, if Tweezerman couldn’t make a payment on time Dal made sure the suppliers knew why and when the payment would be made, and then unasked he would pay interest.
However, as charming and friendly and caring as Dal was, he’s also a Harvard Business grad and no chump. So interesting to me was that he was careful to maintain power in supplier relationships. When Tweezerman agreed to carry a product, the supplier had to agree to supply Tweezerman exclusively. Yet Tweezerman would always be sure to have multiple suppliers for every product, thus ensuring that the company could not be held hostage or damaged by any one supplier. So while Dal was a benevolent king when not crossed, he still was king.
That’s interesting to me as a social responsibility challenge. SR companies have to play in the marketplace and many companies in the marketplace play by a screw or be screwed rulebook. If that really is the majority behavior, then until regulations alter the marketplace an SR company has to play the power games to win, and then choose to wield that power benevolently and police the behavior of their market partners. However the other possibility I hope for is that there are enough companies out there that don’t measure their success by how many other companies they outmaneuver or win-lose negotiate with. Then being successfully SR is about identifying who plays by relationships vs who plays by points and building a network of the right relationships.