As the featured guest at the Customer Value Club, Mikael Rautanen discussed Customer Value and Company Purpose.
Mikael is the CEO and founder of Inderes Oy. Inderes is an open analysis service and community for stock investors that connects listed companies and investors. Customers actually came up with our business model, Mikael said. Listed companies stated that their owners and investors needed analysis and monitoring. Many, however, doubted the viability of a model where companies pay for analyses about themselves. Then, we just started doing it and realized, hey, this really works from both the investors’ and the listed companies’ perspectives, Mikael explains and sends thanks to Innofactor and Raute.
But what is the relationship between customer value and company purpose?
By the decision of its owners, Inderes changed its articles of association in the summer of 2020 to include serving the company’s employees, community, and customers, as well as generating profit for shareholders. The order of stakeholders is crucial.
Owner value always comes through customer value and cannot be achieved without employees and the community, Mikael justifies the change. Mikael finds the much-discussed but rarely criticized section of the Finnish Companies Act that states ‘the sole purpose of a company is to generate profit for shareholders’ questionable, because it often leads to prioritizing things in the wrong order.
In the future, investors will more actively inquire about the value a company provides to its customers and the surrounding world. Investors understand that if a company delivers value to its customers, it will undoubtedly create value for them as well. Mikael believes that responsibility will likely evolve into discussions about a company’s impact.
Just Empty Words and Handwaving?
But is all of this just empty talk aimed at softening the hard core of business?
Often, the things considered soft are actually the hard ones. According to Mikael, building a revenue model is easier. It’s mostly technical. But first, identifying the value created for the customer needs to be tackled, and that’s the most challenging aspect.
Inderes has also recognized the challenges of value leadership and created a playbook for its self-organized organization. The playbook is public and updated semi-annually. Some might consider this handwaving, but the playbook guides the organization to recognize value and create it, Mikael says.
Speech and words shape our reality and thus guide actions, Mikael reminded. In investor communication by listed companies, owner value is often emphasized first, with other stakeholders taking a back seat. Now, a change in sequence is becoming apparent. The most convincing companies talk about how they attract the best talent, the value they provide to their customers, and only then how this translates into owner value.
