All Articles Leadership Inspiration What is your organization's social impact?

What is your organization’s social impact?

4 min read


All organizations have social impact — good or bad, intended or not.

Social impact is the logical consequence of an organization’s plans, decisions, and actions on the social and economic lives of employees, customers, and their communities.

Such consequences might be direct or indirect, immediate or long term. Most organizations are unaware of their social impact and, therefore, invest little time or energy in appraising it.

To understand social impact, let’s look at an organization’s first and primary customers: their employees.

If an employee’s hourly wage goes up a nickel or five pence, there are benefits to the employee, the employee’s family, and the employee’s neighborhood. That wage boost might enable that employee to take his or her family out to dinner one night a month. That outing boosts family member’s satisfaction, possibly boosts their nutrition, and brings business to a local restaurant.

If an employee’s hourly wage goes up a dollar or a euro, the benefits to the employee, family, and neighborhood are typically greater – and more longer lasting.

If an employee is unable to support his or her family on their hourly wage, frustration and depression can be overwhelming. Employees may have to secure another part-time job (or more than one part-time job) to attempt to take care of their family.

If an employee quits and the organization struggles to replace that player, the rest of the employees must pick up the slack – taking on more hours and/or a greater workload. These hours and workload might reduce the employee’s satisfaction, reduce their energy so they don’t exercise after work, etc.

Social impact simply exists. When organizations choose to be intentional about social impact, they move into the realm of social responsibility — first for their own employee team, then for their customers, and then for their communities.

Engaging employees in social good, in intentional actions for social causes, has been shown to boost employee morale, well-being, and productivity. Organizations that share their efforts in social good engage customers more deeply, beyond the “place to grab a cup of coffee.”

Those benefits are enjoyed by customers and community. However, these benefits are not as powerful as those that happen when the company boosts employee wages. Organizations can choose to make their social impact beneficial for employees, customers, and communities. It requires clear purpose, clear intention, and clear action.

The genesis of my evolved thinking on this issue came from Jim Clifton’s excellent book, “The Coming Jobs War.” In it, Clifton presents a compelling business case for organizations to generate “good jobs” for employees. Improving employee wages will likely require a change in business operations for organizations. Improved social impact will help our cities and nations thrive again.

Is your organization willing to boost its positive social impact — now?

What do you think? Does your company intentionally manage it’s social impact? Do employees feel they are fairly paid for the contributions they make? How might your company improve its social impact? Share your thoughts about this post/podcast in the comments section below.

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