Innovation Blog

The Most Effective Organization in America:  You Won’t Believe Who It Is

By Shlomo Maital

 If you like lists of “greatest”, “most innovative”, “most creative“,  try to guess who’s atop the list of “America’s most effective organizations”. 

    The expert selector?   The late Peter Drucker.

    His choice?  The Salvation Army.

    Said Drucker:   “the Salvation Army  is the most effective organization in America.  No one even comes close to it in respect to © clarify of mission, © ability to innovate, © measurable results,   © deducation and © putting money to maximum use.” [1]

   Note those five criteria.  How does your organization stack up on those five?

    Salvation Army is highly visible at Christmas.  Their bands and singers stand on street corners, ringing bells, singing and playing Christmas carols, and asking for donations.  The organization was founded 145 years ago, in 1865, by William and Catherine Booth, who were appalled by conditions in the poor sections of mid-Victorian London and decided to change them.  To accomplish their goal, they established an almost military-like organizational structure.  Today, Salvation Army operates in some 120 countries, and has 2 million volunteers.  They work with alcoholics, homeless, derelicts, and change their lives.  Salvation Army’s mission?  “…to preach the gospel of Jesus Christ and to meet human needs in His name without discrimination”.  It has not changed a jot, in 145 years.

      What is the key thing we can learn from organizations like Salvation Army.  Notes Drucker:   “Starting with the mission and its requirements may be the first lesson business can learn from successful nonprofits.” 

       If “getting the right people on the bus”, as Jim Collins writes, is vital for talent selection,  then aligning the people chosen for jobs with the mission and vision is crucial.    One of the for-profit organizations that does this best is outdoor apparel company Timberland, headed by Jeffrey Swartz.   Swartz is an Orthodox Jew.  He might be put off by this analogy, but I think Timberland is very similar to Salvation Army.  Here is what Swartz told a group of Israeli start-up entrepreneurs that I led on a benchmarking visit to Timberland headquarters some years ago:

       “At Timberland, we think ‘inside out’…   from the factory, outward. In the Dominican Republic we have a plant that employs some 3,000 people.  Most people there have worked in the factory for 12-15 years.  We believe in social justice. We pay good wages there.  This is the lowest-cost factory anywhere, and highest output.  So social justice is also profitable. 

     “Community is more powerful than hierarchy.  And in business strategy,  moral authority trumps business authority.   We build the joy of community.

     “In the Godfather movie, the Godfather says (before ordering someone killed):  ‘It’s not personal’.  Of course it is personal. It is all personal.  Showing respect to people, and answering their questions, is a major part of what I do.

        Lately, Swartz told International Herald Tribune’s Adam Bryant:  “..in hiring I’m desperately probing for the human inside the shell because the people who succeed at Timberland show a little leg, meaning they expose themselves.   At Timberland I want to make it clear from the beginning it is personal… if you aren’t going to play at the level of personal, it’s probably not going to be nourishing for either of us.”

       From Salvation Army’s deeply-committed Christians to Timberland’s Jeffrey Swartz, an Orthodox Jew, the message is the same:  

  A clear powerful mission, coupled with a careful selection process that recruits those who deeply and sincerely  believe in it, create superior results. 

 

[1]  BBC’s Peter Day reported on the modern Salvation Army on Global Business, Dec. 24/09.  Drucker’s article ” What Business Can Learn from Nonprofits” was published in  HBR July-Aug. 1989.