Impact of CSR on marketing with reference to change management using Kotters Model

1. CSR – APPLICABILITY OF KOTTER’S MODEL OF
CHANGE IN THE MARKETING OF THE PRODUCTS
OF COMMUNITY BASED ORGANIZATIONS (CBO)
FROM BOTH THE CORPORATE AND CBO
PERSPECTIVE
LOYOLA COLLEGE, - DR. T. JOSEPH M.COM., M.PHIL., MBA.,PHD.,
CHENNAI ASSOCIATE PROFESSION, COMMERCE DEPARTMENT
- SUNDAR A. RODRIGUEZ M.COM.,FCA.,DISA.,CFSA(USA).,
RESEARCH SCHOLAR, COMMERCE DEPARTMENT

2. CORPORATE SOCIAL RESPONSIBILITY AN
OVERVIEW
• Though the corporates had been for sometime doing something under the ambit of social responsibility,
the Indian Companies Act, 2013, has made Corporate Social Responsibility (CSR) mandatory vide Section
135.
• Section 135(1): Every Company having net worth of rupees five hundred crore or more, or turnover of
rupees one thousand crores or more or a net profit of rupees five crore or more during any financial year
shall constitute a CSR Committee of the Board consisting of three or more directors out of which at least
on director shall be an independent director.
• The Government had notified by GSR 130€ dated 27th
February 2014, various activities that can be
carried out by the company under CSR.

3. ACTIVITIES RELEVANT FOR THIS STUDY
• Schedule VII lists out the activities that could be carried out under CSR Program
• For the sake of relevance to this paper the entries to Schedule VII, namely (ii) and (v) are taken into
account.
• Schedule VII(ii) covers – promoting education, including special education and employment enhancing
vocation skills especially among children, women, elderly and the differently abled and livelihood
enhancement projects.
• Schedule VII (v) covers – protection of national heritage, art and culture including restoration of
buildings and sites of historical importance and works of art; setting up public libraries; promotion and
development of traditional arts and handicrafts.
• Training including skill training and also development of traditional arts and handicrafts, results in
products either incidental to the activity or as output, which on a continuous basis would result in
production of goods, which require marketing.

4. OBJECTIVES OF THE PAPER
• (1) To study the factors affecting the implementing the Corporate Social Responsibility (CSR) from
marketing perspective,
• (2) To ascertain ways and means to use the change management concept in the marketing of the CSR
program products; and
• (3) To find ways to integrate the Kotter 8 stage model of change in the change management from the
perspective both of the corporates and the implementing agencies.

5. METHODOLOGY
• This is based on the Conceptual Research concept, mainly because the impact of the CSR on marketing
would only be known at the end of this financial year and there is no primary data as of now, and this is
done relying on the secondary data and review of the literature including the appropriate statues and
the theoretical framework for the change management.

6. CSR AND MARKETING – NEED FOR CHANGE
AND ITS MANAGEMENT
• The NGOs lack skill set, especially the marketing, hence the products produced by their intervention
through various CBOs could not be marketed and hence the programs had failed, this is mainly due to
their orientation towards empowerment, sustainability, people first etc., with scant respect for making
“profit”
• The corporate driven by their profit motive are strong in marketing as a whole; however, they lack
“humaneness” which is the thorn in the flesh as looked by the NGOs
• These divergent views affect the marketing of the products, hence there is need for some “give and
take” between these two players.
• This give and take requires the change process in both the entities – Corporates as well as the NGOS.

7. KOTTERS MODEL OF CHANGE

8. EIGHT STEPS – IMPACT ON CORPORATES &
NGOSDiagrammatic Representation of 8 step Kotter Model of marketing of CSR program products from the view point of corporates and the implementing
agency
8 Step Kotter’s model of Change Corporate Implementing Agency
Create a sense of urgency There is already a sense of urgency on the part of the
corporates, as the time frame for CSR activities and its
quantum had been specified in the Companies Act, hence
there is urgency on their part.
Having come to know of the quantum of the
funds that are going to pumped into their sector,
NGO/CBO are already not only aware of it, but
had started to pitch strongly through various
forums for their share of funds and support.

9. EIGHT STEPS – IMPACT ON CORPORATES &
NGOS (CONTINUED)
Form a guiding coalition Section 135 of the Companies Act, had clearly laid down
the way in which the corporates who are covered under
CSR to go about implementation of the program by the
formation of the CSR committee, it even talks about its
composition including the need for the independent
director to be part of it.
The NGO on their part had formed forums
where they have arranged for the meeting of
minds with the corporates. In this forms, the
coalition of both the corporates and the
NGO/CBOs are taking place.
Create a vision The corporate culture of accountability and having a
clearly drafted Mission and Vision statements would
percolate down in all the activities including the CSR
carried out by them, however, the same would require
some fine tuning as it would not be in line with the
generally accepted not for profit organizations with
people taking precedence over profit.
The NGO/CBO on their part had to clearly draft
their Key Performance Indicators that are
imbibed in their programs to be articulated in a
better way to be in line with the business
vision and mission statement.
Communicate the vision The vision has to be communicated amongst the
stakeholders in proper manner.
In case of the corporate the stakeholders are clearly
defined and identifiable hence communicating the vision
to them would be easier.
Unlike the corporate the implementing
agencies do not have a clearly defined and
identifiable stakeholders, and even if they list
them it is overwhelming, they talk in the way
to identify with the whole world, but that is
how they are.

10. EIGHT STEPS – IMPACT ON CORPORATES &
NGOS (CONTINUED)
Empower others to act on
the vision
Since two parties with divergent views and mission come
together in the CSR marketing, it would be better if it
results in a compromise on the approach, as the approach
to the marketing from the corporate would be to maximise
profits, whereas for the implementing agency there could
be other priorities. These should be sorted out through
mutual empowerment. The Corporate should try to imbibe
the concept of earning income more than expenses (a
euphemism for profit) to sustain the operation to the
implementing agency.
The implementing agency should be more open
towards the concept of “profit” from the
sustainability point of view in case of marketing
of the products produced through CSR programs.
The implementing agency should try to empower
the corporate to be more humane as profit is not
“everything”.
Create Quick Wins The partnership of corporate and implementing agency
should focus on short term targets than to have long term
one. The short term target for the CSR program from the
marketing perspective for example could be reaching the
market to the time tested corporate network for brand
building of the products and of the implementing agencies
etc.
This short term quick win situation or targets would propel
the CSR with upward mobility.
The implementing agency should focus on short
term targets than to have long term one. The
short term target for the CSR program from the
marketing perspective for example could be
assignment of the production process in the
supply chain management to the weaker
sections, reaching out to the markets through the
community based network of etc.

11. EIGHT STEPS – IMPACT ON CORPORATES &
NGOS (CONTINUED)
Build on the Change Having tasted the success of the quick wins, based
on the common platform of ideas in the same
language between the two divergent partners,
would make them believe that change has done
good, and that would make them build on the
change, resulting in better marketing strategy.
Having tasted the success of the quick
wins, based on the common platform of
ideas in the same language between the
two divergent partners, would make them
believe that change has done good, and
that would make them build on the
change, resulting in better marketing
strategy.
Institutionalize the change. The change which has taken place has to be
institutionalized within the CBOs who ultimately has to
take up the responsibility, as the corporates and NGO (the
facilitator) could not hold its hand forever, but at one point
leave them to manage their affairs. Likewise the corporates
too have to move on for they would not be interested in
getting tied down in one program. Hence this process of
institutionalization of change especially with regard to the
marketing of the products of the CSR program is crucial.
The concept of “leaving and moving
forward” is what the NGOs want to do,
but due to lack of institutionalization of
the change concepts which had resulted
in tangible results they could not do it.
Hence this process of institutionalization
of change especially with regard to the
marketing of the products of the CSR
program is crucial.

12. MAJOR FINDINGS
• The CSR program implement with special reference to the projects suggested
in Schedule VII (ii) and (v) gives rise to the production of products in one form
or other, and that would require a proper marketing strategy to sustain the
efforts. However due to the divergent views of the partners in this, namely
the corporates on one hand with “maximisation of profits” ideology and on
the other hand NGO/CBO for whom “people” comes first, it is essential to
make the marketing successful, to have a change process of their mind-set
and also the strategy for marketing. This could be achieved by linking the 8
steps process for change by Kotter.

13. RECOMMENDATIONS
• The 8 step model of change advocated by Kotter gives a structured
framework to pursue the change management in the process of marketing of
the products produced by implementing the CSR Projects. The success in
implementing the same would be the open minded approach of both the
parties concerned. This open approach and burying the hatchet of different
terminologies by adopting common terminology for the marketing of the
products and for the CSR program in general would go a long way in making
the CSR Program a successful and sustainable program.

14. QUESTIONS

15. THANKS

16. THANKS
• Loyola College, - Dr. T. Joseph M.Com., M.Phil., MBA.,Phd.,
• Chennai Associate Profession, Commerce Department
• - Sundar A. Rodriguez M.Com.,FCA.,DISA.,CFSA(USA).,
• Research Scholar, Commerce Department