The Responsibility Revolution: How the Next Generation of Businesses Will Win
by Jeffrey Hollender and Bill Breen

Traditionalists and cynics may disagree, but it is a fact-companies and organizations large and small are implementing corporate social responsibility (CSR) as one of their core missions. Understanding that business success depends not only on the bottom line but on doing good, companies new and old are realizing that the modern world demands much more than balance sheets and board meetings.

The Responsibility Revolution is written by Jeffrey Hollender, co-founder and chairman of Seventh Generation, a leading brand of eco-friendly household products and a pioneer in the realm of "good" companies. Hollender uses many companies as examples of those embracing CSR, but focuses mostly on the actions of a few. Organic Valley, a Wisconsin-based agricultural cooperative, is one company he sees as a model for the new generation of socially responsible companies. What started as a handful of family farms selling dairy and meat products, has grown into a co-op of 1,332 farmer-owners with a 2008 revenue of $527 million. Along the way, Organic Valley has abided by its mission to save family farming culture and produce the highest quality organic products while helping Mother Nature by cutting the use of pesticides, growth hormones or other land and body toxins-ultimately proving that companies that work to better their industry, community or environment can also be profitable. 

But Hollender also highlights something much more groundbreaking-companies that have actually created corporate cultures based on openhearted, community-based virtues like happiness, love, freedom and service. One such company is Linden Labs, maker of the virtual reality game Second Life. Linden Labs frowns upon the fear that is so prevalent in most offices and instead encourages creativity and enthusiasm, citing a study by a Harvard Business School professor that found that anger, fear and anxiety are negatively associated with business creativity. And at Linden, it is not the board of directors or senior executives who decide who receives bonuses-the employees decide themselves. They are given an equal portion of Linden's net profit, which must be given to co-workers who, in that employee's opinion, deserve it. Also somewhat revolutionary is the fact that in its early years, Linden's engineers were not assigned projects. Instead, they were given the opportunity to pick from a database of available tasks, allowing employees to work on what interested them, in turn making them happy (or at least content). And a happy employee, through increased productivity, equals a successful business. 

Woven throughout these real-world case studies are suggestions, lessons and advice on how to make any company, whether a two-person, grassroots startup or a blue chip Fortune 500 company, socially responsible. Hollender gives guidance in chapters that focus on building a purpose-driven community, why companies should be as transparent as possible and how to build profits and solve problems through mass collaboration. And in a world where consumers are increasingly demanding that companies contribute to the greater good, the information and examples included in The Responsibility Revolution are practical and useful. 

"Business can, in fact, help build a better world than the one we've inherited," writes Hollender. "The goal of replenishing society and the environment is certainly within our grasp, so long as we cut through the constraints of settling for what's acceptable and dare to imagine what's transformational." 

-Emily Holbrook

Flip the Funnel: How to Use Existing Customers to Gain New Ones
by Joseph Jaffe

It is no secret that acquiring new customers or clients is one of the most expensive endeavors for any business. Direct mail advertising, for example, receives the lion share of marketing dollars at many companies, and the response rate is generally around 1%. That means that in a successful direct mail effort, one out of 100 people acknowledge the campaign in any way while the resources devoted to the other 99 are totally wasted.

Flip the Funnel looks at how companies can slash the time, staff and resources devoted to such wasteful programs and instead focus on what is really important: Getting the customers you already have to buoy the bottom line. This, in and of itself, is nothing new, and customer retention has been championed for years.

What Joseph Jaffe is attempting to illustrate in his new book, however, is how to not only get your current customers to spend more, but how to get them to bring you new customers. He wants you to turn your customers into recruiters and let them do your marketing. And while this is a strategy that sounds more like a get-rich-quick pyramid scheme than a business model, there are many emerging ways to make this theory a reality.

Real-world examples from Apple, Coca-Cola and even the Obama campaign show how the use of social media and the cultivation of key "influencers" and "evangelicals" for your brand can make all the difference and allow you to "flip the funnel." In many ways, these companies have gone from trying to reach as many people as possible and hoping a few buy, to focusing on the buyers and getting them to influence their peers. And it is working.

"What if we got it all wrong?" writes Jaffe. "What if everything we held about doing business was backwards? What if all our theories, assumptions and best practices were, in fact, flawed? ... I'll encourage you to flip everything you knew to be true on its head. I'll encourage you to flip the funnel."

-Jared Wade

Delay, Deny, Defend: Why Insurance Companies Don't Pay Claims and What You Can Do About It
by Jay M. Feinman

The basic goal of insurance has always been to provide policyholders with the security that unforeseen losses will not drive them to financial ruin. Insurers promise that if you buy their product, they will cover you if something goes wrong. But increasingly, policyholders have discovered that getting a claim paid can be an arduous task as insurance companies do everything they can to avoid their obligations. Essentially, insurers have broken the core promise that justifies the very existence of their product.

The motivation for this behavior can be summed up in one word: profit. These days, insurance companies are more interested in serving their shareholders than their policyholders. And the easiest way to increase the bottom line is to reduce the losses that come from paying claims. So they delay to take advantage of float (the lag time between taking in premiums and paying out claims) and maximize their earnings on invested premiums. Or they just deny any responsibility to pay at all and then defend their refusal-in court if necessary-in the hopes that the policyholder will give up when they exhaust their resources or the will to fight.

This may not be a revelation to most of us, but Delay, Deny, Defend is more than just a statement of the obvious. It is also a fascinating look at how we got here and what we can do to protect ourselves. As the author deftly explains, the shift in focus from customer service to the bottom line was no accident but rather a systemic change in the way insurance companies do business borne out of the desperation of a 12-year soft market in the 1990s, a relaxed regulatory environment and the influence of consultants who demonstrated to the insurance industry that claims could become a profit center. And it is going to take consumer awareness, government involvement and harsher penalties if there is any hope in fixing what many believe to be a broken system. Only by ending the system of delay, deny and defend can insurers regain the confidence of the people they claim to serve.

-Morgan O'Rourke

Emily Holbrook is associate editor, Jared Wade is editor and Morgan O'Rourke is editor in chief of Risk Management.