|Considering frugal Servant Leadership|
Putting people first does not have to correlate positively with low profit margins. Companies like Starbucks and Southwest Airlines have put people first in their business models with generous employee benefits and education and gained a remarkable profit margin. Servant Leadership is a leadership model that can and should be deployed in all companies, large and small, for-profit and non. Servant Leadership is socially responsible and promotes employee satisfaction. Servant Leadership promotes a sustainable profit margin as well as community but the question remains can a for-profit organization put people first? Servant Leadership can be applied to large for-profit companies in fact it can provide a sustainable profit margin. Servant leadership promotes stakeholder loyalty and stakeholder loyalty promotes community. Businesses must be people focused to sustain for generations. Large companies impact diverse people groups, the social structure of these communities as well as their environments. Large companies are constantly shaping our world. Servant Leadership can be applied to large companies such as the for-profit universities and is a topic that deserves further exploration.
Servant Leadership as a Business Model
Companies such as Starbucks and Southwest Airlines are deploying policies that are Servant Leadership friendly from the birth of the business with great success. Southwest Airlines is creating a Servant Led culture that marks the organization as well as society. Large non-profit companies such as Fuller Theological Seminary, Habitat for Humanity and the Southern Baptist Convention have run successfully on Servant Leadership for Generations. Fuller Theological Seminary was founded in 1947 and has a rich history of servant leadership as well as a working community that functions on collaboration with social responsibility being a core value. The business model of Fuller Theological Seminary will provide an example of what can be done when Servant Leadership is made the end goal of a large organizational model. Habitat for Humanity was founded in 1976 and serves as an excellent example of how a company can grow and expand to all corners of the globe when a business is built on people rather than profits. Habitat for Humanity is a non-profit that has seen enormous growth from a small start in Georgia and now to over five continents. Although large non-profit companies are different from the large for-profit companies in the goal of making a profit this is really where the contrast stops considering that all companies, both for-profit and non, do have a bottom line. Large for-profit companies can indeed learn from large enduring non-profit companies in terms of sustainability.
An important component of the Servant Leadership Culture is the decentralized organizational model. An excellent example of this can be found in Starbucks. According to Ferrell, Fraedrich & Ferrell, a decentralized organizational model is prone to unethical behavior; however Starbucks is a model that can be used to argue against this theory as it uses its decentralization to encourage its managers as well as individual employees to look for ways in which they can exhibit ethical behavior. I would argue that the decentralized organizational model, when used properly, encourages ethical behavior. Not only does Starbucks give its managers freedom of philanthropy, it encourages employees both new and old to contribute suggestions to the company on a regular basis, publishing these suggestions, even the anonymous ones in the company newsletter. This method of publishing the suggestions affords a form of corporate accountability that encourages ethical behavior.