What is the key to successful organizations?

Relationships!  That’s right, relationships are one of the most important assets in any business and are crucial in driving growth, yet they are rarely discussed and almost never measured.

The Chartered Institute of Personnel and Development (CIPD) has partnered with Tomorrow’s Company, CIMA, KPMG and Linklaters to urge business to understand and invest in their relationships, whether with employees customers, suppliers, partners or the community.

According to an article written by R. Jeffrey for People Management, organisations were lambasted for paying lip service to relationships. As Tony Manwaring, chief executive of Tomorrow’s Company, explained it: “We need to get beyond the cliché that people are our greatest assets when so often we palpably don’t treat them that way.”

Tomorrow’s Relationships offers advice on how to recognise and nurture existing relationships and develop new ones, as well as steps to begin quantifying and reporting their value. That’s a controversial point, according to CIPD deputy chief executive Susannah Clements, who said it was about as socially acceptable as measuring how much you love your children. Any discussion of metrics provoked “violent reactions” among some, she added, but it was a vital step to move beyond empty gestures: “Talking about relationships and people as assets has become a truism – nobody bothers to think about it.”

A central problem, said Clements, is that many of our behaviours are inspired by management theories that are decades old: “Business and society has moved on and our processes are out of kilter with what we now know about human behaviour… we know, for example, that giving people large pots of money once a year is a terrible way to motivate them, and yet we continue to do it and remuneration committees continue to recommend it.” A greater emphasis on human interaction could in turn make our organisations more humanistic, she said.

The Tomorrow’s Relationships panel agreed on a need to make business language more accessible – to stop referring to “stakeholders” and depersonalising relationships – and to make relationship management a business-critical issue for boards. The management of relationships could be a worthwhile end in itself, they felt, rather than just a driver of revenue, though Clements noted that an emphasis on relationships was very different from only wanting “cuddly people” on the books: “It’s a way to better understand what each individual can bring to the organisation.”

Find out more at tomorrowscompany.com/tomorrows-relationships