FoE Book Cover

This insightful book argues that success of any enterprise is built on a foundation that goes deeper than what we do and how we do it. In Firms of Endearment, terms like purpose, meaning, appreciation, joy, and yes, even love are not only acceptable, they are critical in the corporate language and culture. And they are not reserved for internal use or marketing efforts; these attributes are applied to all stakeholders, including customers.

Some people might think it’s about a 60’s revival or some do-gooders. Exactly the opposite is true. The book features an in-depth study of firms that have outperformed  their peers and the market as a whole. Publicly traded Firms of Endearment enterprises returned 750% over 10 years while the S&P overall provided a 128% return. Even more interesting, these companies provided a 205% return, while the S&P lost 13%. We’re talking about household names like Amazon, Best Buy, Google, Honda, IKEA, Patagonia, Timberland, Whole Foods – just to name a few.

Why do emotional connections between stakeholders make such a difference?

It’s fairly straightforward. Think about the relationships in your life: Some are rewarding because you really feel appreciated. Some are pure transactions. Interactions often drain energy while feeling appreciated gives us more energy. And they encourage us to have more interactions with the brand. Same is true when your turn it around: You feel more energetic when you are being appreciative of what you are doing and whom you are interacting with than if you were feeling dread about it.

The focus on emotional connections decreases the turnover rate, increases internal and external loyalty and, ultimately, improves profitability. Companies have to do better than just declaring people are their most important assets. They have to live it.