In the April 28, 2008 issue of the New Yorker, there is an essay called “Parsing Paulson.” Now, I’m the first to admit I know next to nothing about economics and financial regulations. What caught my attention in this essay are the ideas of regulation as a “rules-based” approach versus regulation as a “principles-based” approach.
A rules-based approach is, “lawmakers and regulators try to prescribe in great detail exactly what companies must and must not do to meet their obligation to shareholders and clients.” A principles-based approach is, “regulators worry less about dotted ‘i’s and crossed ‘t’s, and instead evaluate companies’ behavior according to broad principles.”
Since my understanding of the financial process is limited, I abstracted these ideas to what Substance does: digital brand strategy as a rules-based company vs. a principles-based company.
Rules = Process
Principles = Beliefs
(I might be oversimplifying what “rules” means, but in my abstraction I defined rules as “process.” The process in which projects are done, the process in which people are hired, the process in which the chain of command goes from the top down to the bottom. Principles, on the other hand, are, “our beliefs, our ideas, our instincts, and ways to best represent the brand.” So humor me and we’ll run with that…)
When asked in proposals and meetings about our process, it really comes down being principles-based in our approach instead of rules-based. Following a process for the sake of process is a rules-based approach. “This is how we’ve done it, this is how we do it, and this is how we’re gonna do it.” But focusing on what you want to accomplish and why you want to accomplish it, that’s principles-based. “Let’s worry less about the process, and instead focus on the principles for creating a great digital brand experience.” There are agencies that swear by their process, that it will produce x pageviews, result in y revenue, with z search engine rankings. We’re not one of those agencies. Every client and every project has a unique objective with unique results.
When I told David about this article, he gave me this quote, “Rules are seen as something to be circumvented. Principles are something you aspire to.” As a company, are you trying to circumvent the rules, or are you aspiring to something great? And are you simply talking about principles, or are you enforcing, enabling, and embodying them?