I find articles that are in opposition yet they support each other in an awkward way. The following two fall into that category.
Greed is not something new it has been around for eons. Through history it has been the conquerors, the war mongers wanting more territory. They massed massive fighting forces and set out to conqueror the world. They burned and destroyed, raping and pillage as they went, screeched earth policy at times.
So how does one develop a close set of ethics? When I first started college, ethics was a discipline and in some courses a requirement. Most was focused around Christian ethics and there were the philosophers and economists that were studied. Much of that is now gone because of the christen backlash and anti-Christian mode our government is in.
For if one can get rid of ethics one can then set their own rules. It appears today that is where we are. So many people defy rules and want it their way. Mention ethics to these people and they have a great big question mark.
What I see is big business and bug government have pushed the limits and people are starting to say, whoa…. Enough is enough. Us little people are getting squeezed between the big giants and for some it is hurting. What kind of backlash will there be…. A ponderous question.
Enjoy the blurbs.
from The Full Feed from HuffingtonPost.com by Stephen Herrington
If you are old enough to remember Eisenhower as your President, you are old enough to have known a business community that was populated by men of some integrity. Not all were such, just like everyman, there were some for whom the temptations of fraud and theft were just too great. But as a whole, business was more responsible to their customers, the public and their nation then, as Ian Fletcher notes in his Economics: How to Cure a Sick Discipline. It was an environment that made the fantasies of Ayn Rand seem more plausible, that a noble business man’s rational self interest is to be relied on more than any interference from government. She and they, the businessmen, could not have known that her raptures on the subject would lead to disgrace and discredit for the exact same souls she sought to deify.
It would certainly be more efficient of government spending if businessmen reliably attended to broader interests than their personal bottom line. But we have entered an epoch in which that is not the case by anyone’s measure outside of the very board rooms that countenance the financial misdeeds we now lament. We didn’t need business police for a while after the Roosevelts. The threat of the law changed the business landscape channeling it to select leadership that would not run afoul of the regulators. Fealty to a greater good was effectively internalized by business. Deregulation changed all that and in short order. We will have to do it all over again as business leadership has degenerated to the point that the term business doesn’t seem to apply anymore. We now have a white collar Mafia constructed to do just enough commerce to white wash their theft. Push this envelope just a little more and they may even drop the pretense.
Certainly the party of big business, the GOP, has dropped the pretense of legitimate argument. By means of coffers filled with ill gotten gains the new era of corruption in our government threatens to sink the last vestige of representation for the public interest over business interest, the Democrats. Both parties, in the grip of a campaign system accustomed to gorging on money, have left most semblance of forthright advocacy behind. Instead we argue hot button Schizoaffective drivel. What we ought to argue, instead of laundry lists of distractions based in peri-religious hoax and fear baiting, is how to recapture the more pleasant state of affairs that proceeded from the last round of regulation in the 1930s.
The rational argument is about how to achieve a business climate in which business does more good than harm to the country, to the public and, ultimately, to itself. You might even call it rational self interest.
Greed is not rational. Greed fears a world in which all systems fail, a private hell of aloneness. Greed does not recognize that it is the driving force to create the failure that it would hoard to avoid. It is a self-fulfilling prophecy in practical terms. It destroys because it fears destruction.
To allow the greedy the leadership of a business or a country is to enable their disordered world view. Yet somehow we have come to attribute business acumen to the most greedy. They produce the most profit in the shortest period of time precisely because they do not believe in any future. Consequences are not real because there is no tomorrow past the bonus deadline for the fiscal quarter. And somehow we keep mistaking this for success. It’s not.
Examining the shambles of American businesses wrecked by M/A and LBO activity for the last three decades, it is easy to see that many of those ruined companies would have still been there were they not dismembered to line the pockets of the greedy. It is also apparent that the destruction served no greater goal for the nation. Entrepreneurs, true entrepreneurs, do not sack companies. They build them. Building companies takes acumen. Gutting them takes only greed.
If this current round of regulating finance is successful, finance will, again, internalize the mores that led America to its greatest successes and prosperity. It will enable true business acumen and not confuse it with greed. Business will self regulate again in short order, organically. The massive financial police force will be obsolete itself in a decade. It will last long enough to drive the criminal element out of our banking system, and our corporations, and condition both to serve the public rather than steal from it. We will all be better off, even the bankers. The greedy will go back to selling used cars. Then the process of deregulation will begin anew. If we don’t remember that is.
from The Full Feed from HuffingtonPost.com by Frank Koller
School’s almost out. A new crop of MBAs is poised to assume leadership positions in the American economy. Have the horrors of the last two years made a difference in how they plan to run this country’s businesses?
The best-selling case study of all time at Harvard Business School (HBS) is not about Coca-Cola or Microsoft, but the Cleveland-based arc welding manufacturer Lincoln Electric. First published in 1975, the case has sold roughly 300,000 copies. Almost every MBA candidate at Harvard reads the original or one of several updated versions, as do tens of thousands more business students across America.
I stumbled on that publishing tidbit soon after stumbling onto the story of Lincoln Electric and its amazing unbroken "guaranteed employment" promise, the subject of my new book, SPARK How Old-Fashioned Values Drive a Twenty-First Century Corporation.
Guaranteed employment, you may have noticed, is rare these days. 8.4 million Americans lost their jobs during the recession. Today, the Department of Labor announced that the unemployment rate rose in April to 9.9 percent. Some of that was due to more people entering the labor force, but more than 15 million Americans remain jobless. More troubling is that almost 7 million have been unemployed for more than 6 months.
Lincoln Electric, by contrast, has not laid off a permanent American employee for economic reasons since at least 1948. Yet since the 1930s, this Fortune 1000 firm has remained the world’s largest manufacturer of arc welding technology with factories in 18 countries and sales offices in 150.
The no-layoff guarantee is straightforward: once past a three-year probation, no employee who meets the firm’s well-defined, regularly-measured performance standards will ever be out of work. The 1975 Harvard case (by Norman Berg, now Professor Emeritus) explored how Lincoln Electric had grown, while remaining profitable, through good times and bad. Change a few dates, and the case stands updated to 2010. The key is a mutually-reinforcing system of incentives to motivate workers with a no-layoff promise, a rich profit-sharing bonus, the use of piecework to pay factory workers and open internal communications. The case stresses that you can’t cherry pick one element – such as guaranteed employment – and expect improvements.
But I was puzzled: if so many prospective MBAs, who become America’s corporate elite, study the documented importance of a guaranteed employment promise to this company’s decades-long record of success, why is it such a rarity?
One reason is that while the average B-school student reads roughly 400 cases, the Lincoln Electric case is virtually the only one to introduce a no-layoff policy, in theory let alone in practice. Most students can barely remember the concept when they graduate.
A more troubling reason is that many professors at Harvard and other MBA schools are deeply skeptical of offering workers such a bargain.
"It’s a terribly non-optimal and inefficient policy," says George P. Baker, the co-chair of the HBS doctoral program. "Lincoln Electric is a special case. Unless there is some other reason for having it, as part of an incentive system, you would be wrong to recommend it."
"I’m not unsympathetic to guaranteed employment and the long-term social strengths it builds," says James Rebitzer, Chair of the Business Policy Department at Boston University’ School of Management, "But I think there are only a very few special circumstances where a commitment to no-layoffs actually improves operating efficiency."
Harvard students such as Corey Crowell (MBA 2009), who read the case just days before we met, got the message: "I just worry that the sense of a guaranteed job would create complacency … look at the auto industry."
At MIT’s Sloan School, Thom Kochan is more positive about the competitive advantage of guaranteed employment as part of a "whole incentive system." But Prof. Kochan says most employers run from no-layoff policies such as Lincoln Electric’s because "Few organizations in America are willing to have as egalitarian a compensation system in terms of income levels from top to bottom." (That’s polite for "executive greed.")
Harvard labor economist Richard Freeman bemoans the fact that layoffs are still accepted as an effective management tool, despite mounting evidence to the contrary: "No business school encourages students to think about a scenario where they don’t have the option of getting rid of (employees.) It requires a different set of skills which I don’t think our B schools are very good at."
When Norm Berg wrote the case in 1975, he wanted to challenge students to examine the basic principles of our economy. "Lincoln Electric has felt all along that job security is important to people," Berg told me. "But most professors and students at business schools now have no personal experience with layoffs or are even familiar with people for whom this might have been a problem. (Guaranteeing employment) does not fit their view of the world. It’s unfortunate, but not surprising."
After the human carnage of the past two years, that "view of the world" – which dominates most MBA programs – needs updating. The Lincoln Electric case will be on most reading lists again next fall, but the country needs more B-school professors to help students understand its powerful message. Then, hopefully, more newly-minted MBAs will consider adopting no-layoff policies once they become responsible for the future of their employees and their families.