In the context of sustainable high performance in an organization, the three-legged stool metaphor represents the three necessary conditions for achieving that goal:
- Commercial Responsibility,
- Customer Value, and
- Culture.
The first leg of the stool is Commercial responsibility, which refers to an organization’s ability to manage its finances, resources, and operations to ensure its long-term viability and profitability. This leg supports the organization’s ability to make strategic investments, manage risks, and maintain financial stability.
The second leg of the stool is Customer value, which refers to an organization’s ability to provide products, services, and experiences that meet the needs and expectations of its customers. This leg supports the organization’s ability to attract and retain customers, build brand loyalty, and generate revenue.
The third leg of the stool is Culture, which refers to the shared values, beliefs, and behaviors that define an organization’s identity and influence how its employees interact with each other and external stakeholders. This leg supports the organization’s fostering innovation, collaboration, and continuous improvement.
When all three legs of the stool are strong and in balance, the organization can achieve performance. However, suppose any one of the legs is weak or missing. In that case, the stool becomes unstable and the organization’s ability to perform over the long term is compromised. Therefore, organizations need to prioritize and invest in all three legs of the stool to achieve sustainable success.
While the three-legged stool metaphor represents the necessary conditions for sustainable high performance in an organization, the real power lies in finding synergy between the three legs. Just like a stool, it is the tension and interdependence between the three that create strength and enables the organization to thrive in a rapidly changing business environment.
When an organization finds synergy between the three legs, it can create a culture that values commercial responsibility, customer value, and innovation. For example, a culture that values commercial responsibility and customer value can focus on creating sustainable products and services that meet customers’ needs while minimizing the organization’s impact on the environment. A culture that values commercial responsibility and innovation can lead to a focus on developing new business models that generate revenue while also creating social or environmental value.
Furthermore, finding synergy between the stool’s three legs can help an organization adapt to changing market conditions and customer needs. For example, if the organization’s culture values innovation and customer value, it may be more likely to identify emerging trends and develop products or services that meet those needs. Additionally, a culture that values all three legs of the stool can lead to greater employee engagement and retention, as employees are likelier to feel a sense of purpose and meaning in their work.
In summary, the three-legged stool metaphor provides a helpful way to understand the necessary conditions for sustainable high performance, by finding synergy between the three legs. When an organization values and invests in finding synergy between all three legs, it can create a culture that fosters innovation, collaboration, and continuous improvement, and enable the organization to thrive over the long term.