There was a delightful story published in BBC News recently that I can’t let go. The editor reported on why a town in Iceland halted construction for a new Reykjavik-suburban highway after concerned campaigners protested the development. The citizens’ concern? They warned that it would disturb and provoke elves living in its path.
Elves in Iceland, for those who believe, are typical people, but invisible to most humans. They are called Huldufolk, or “hidden people.”
Though charming, it seems very strange that folklore would be so powerful of an influence that it would override infrastructure development, which is especially important to a country still climbing out of significant economic struggle.
Thinking about Iceland’s elf protection more, however, it makes a beautiful metaphor for considering the hidden stakeholders in any business interaction.
A strong business strategy accounts for all stakeholders – even the “elves” – those who may be quiet and concealed. Additionally, it’s important to understand the nature of relationships that exist among stakeholder groups. In Iceland’s case, the elves had their human advocates, who were willing to protect Elf interests – or at least preserve their own interests by evading Elf retaliation.
In some ways, this could be another way to look at what’s happened with big-box retail darling, Target. The WSJ recently reported the retailer has “lost its way under ousted CEO Gregg Steinhafel,” and goes on to detail how creative risks that helped build the company took a backseat to rigid performance metrics. As the CEO tried to advance the company with an eye on profit, he established layered management that delayed decision-making and dismissed internal frustration. This ultimately led to “deep malaise” within the company, as well as slumping sales, with customer traffic falling in six straight quarters.
While there were many factors involved in Target’s decline – including a very serious security breach – it is clear that the elves were overlooked by the ruler of the land – er, the CEO. Reliable customers and suppliers were not getting the same experience out of their relationship with the Target they had come to know and love. Long-time employees felt their opinions were overlooked and their creative heritage was undermined in favor of non-differentiating profit drivers.
Ultimately, market dissatisfaction laddered up to unhappy shareholders, a tougher stakeholder group for the CEO to overlook. Not surprising, the board ultimately asked the CEO to resign.
Target is now transforming. Freedom, speed and creativity are being reinfused into the organization. “Leadership teams” have replaced “executive committees” and the company hopes, through time, to reclaim the customer experience that brought the company to fame in the first place. And while the magic of ‘Tar-zhay’ might not be fully restored, it looks like with this new strategy, there will be a little more consideration for stakeholders – even the elves.
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