Strategy and social responsibility

By Homero Contreras

All operations and actions of any company must be led by a strategy, and IEs can be involved on most of these operations. In recent years, issues about social responsibility of the companies have been highlighted, especially in the care of the environment and ecology.

On January of this year, Michael Porter wrote an article related to the social responsibility of the companies and how capitalism is linked to it. His article finally agrees with the idea of the Bottom of the Pyramid of C.K. Prahalad that is, serving the world’s poor people.

Industrial engineering tools can be applied to improve operations and design new strategies and systems which allow serving this poor people in a profit manner; however, companies, and hence, IE’s, are always exposed to the critics about companies who abuse of poor people, especially in countries in Latin America.

Harvard Business School has a case related to De Beers Mining Co.; it is possible that we all have information about this company, the most important diamonds firm in the World. Founded in 1880’s, has used a social responsibility philosophy since its beginning, supporting the countries where De Beers works (mostly in Africa). The company has provided services in education, health, housing, urbanization and water for its workers, but has been constantly attacked because it’s a company focused on rich people and also because the problems caused by the “blood diamonds”.

I think it is really worth to be conscious about the idea of social responsibility; of course, we must be aware that our companies do not generate dependency to the society served. If Michael Porter, who has always been focused on completion and profits, is now paying attention to social responsibility, we should not leave out this focus.

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About the Author

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Industrial Engineer; Master of Strategic Planning and Management of Technology and Ph.D. candidate in Strategic Planning. More than 15 years of experience in the textile, automotive, retail and consulting industries. My expertise and research subjects are applied simulation, strategic planning and logistic systems.