Milton Friedman was a brilliant economist and, like all economists, a moral philosopher. His pronouncement in 1970 that the only social responsibility of business was to “use its resources and engage in activities designed to increase its profits…” has been taken to heart by two generations of business leaders – perhaps a bit too much. Friedman was talking about what we now call corporate social responsibility (CSR), an expense in his view that undermined a corporation’s true purpose: to create jobs, returns for investors and downstream wealth effects for society.
In this respect, Friedman was out of step with Adam Smith, the 18thCentury economist and philosopher who hated corporations as much as he hated government interference in the productive purpose of work and business. He believed that efficient markets and general welfare resulted from the local business owners bearing the cost of their enterprise and sharing the values of their communities. He viewed government primarily as an instrument for extracting taxes to subsidize elites and for intervening in Continue reading “Milton Friedman, Adam Smith and the Business Roundtable”
A poor attempt at humor by someone in the JPMorgan Chase marketing department led to my faceoff with the co-founders of the Rochester Chapter of the Democratic Socialists of America (DSA) on live radio. Chase’s tweet made fun of those who can’t figure out how to keep their bank accounts out of the red. In our debate, I maintained that people should take responsibility for the consequences of their own actions while the DSA crowd advocated that people are victims of marketing and should get some relief from those who impose unreasonable costs on them.
You shouldn’t be surprised that we didn’t reach agreement. But it was something that I said to the younger of the two that stopped him in his tracks (although we didn’t explore it). I am on record as predicting that Millennials will save capitalism (see The Fourth Turning: How Millennials Will Save Capitalism) and cited the Conscious Capitalism Continue reading “It All Started with a Tweet”
Have you ever repeated a phrase so often that you find you’ve forgotten what it means? In a group meeting this week, I referred to a company’s “mission” using a phrase that I’ve repeated for years. A new member of the group challenged me and threw me off balance. What I was really referring to was the company’s purpose.
Simon Sinek, author of “Start with Why” and a speaker whose TED talk is among the most watched in history (over 41 million views), Continue reading “Mission vs. purpose: the what and why of doing what we do”
Regular readers know that I am “old school.” As a hiring manager, I focused on finding talent not hiring for skills. “Skills can be learned,” I would say. “But, you can’t fix stupid.” That approach to hiring has faded away. We now focus on functional skills.
The Internet has cemented the skills approach to hiring. In the early days of Monster.com and its ilk, job candidates had to figure out what keywords should be Continue reading “HR and AI: how technology is taking over Talent Management”
About every three months, I join a group of colleagues for dinner followed by an all day meeting. Our goal is to share best practices, bond with one another and have some fun. Nothing unusual about that, right? What makes it different is that there is no corporate sponsor. It’s an Ad Hoc group of people who share a profession and a common interest in getting better at what we do. Most of us hop into our car and head to a central location within an area bounded in the north by Toronto, the south by Pittsburgh, the east by Rochester and the west by Indianapolis.
At our last meeting, one of our cohort suggested we try an exercise she thought of as a best practice: tell the story of your life in 5 or 10 minutes. I am a new member of this Continue reading “Touchstones: Connection, Reflection and Failure”
We’re flush with new college grads this month. This crop has graduated into a rare economy – one in which employers are challenged by the dearth of candidates to fill the jobs they’re offering. Contrast that to ten years ago when even those with advanced degrees from top schools were kicked to the curb.
If faced with a plethora of opportunities, it would pay for grads to check with their friends who majored in physics before making a decision Continue reading “Any Jackass Can Kick Down a Barn”
The effort to help Japan rebuild after World War II included sending leading American management guru, W. Edwards Deming, to embed his Total Quality Management (TQM) ethic into that country’s manufacturing industries. Perhaps if Detroit’s Big 3 had simultaneously embraced Deming, we would see more Chevys and fewer Toyotas on our highways today.
TQM is based upon the idea that the performance of workers is dependent upon the system within which they work. Deming believed that managers apply all the wrong Continue reading “The management guru that time forgot”
Among the biggest challenges for corporate leaders is to establish trust. It’s not difficult to understand why. Most management positions are filled by the person most successful in a non-managerial role, not the person who exhibits the most leadership potential. Unsure of what to do or how to behave, they emulate their superiors, most of whom got their role the same way.
The default mode of the worst bosses turns people off. Many are unwilling to admit what they don’t know and often act on impulse. They lack empathy, often expressing the attitude that “if you can’t do it, I’ll find someone who can.” In short, they make excuses for their own Continue reading “Three things to get your team to trust you”
The mission of my first assignment in the corner office was to turn the business around. Bleeding cash, lacking sustainable IT and other infrastructure, and having suffered through a bad leadership episode, the company was teetering on the brink of failure. My first impression as CEO of the company (Lifewatch, then called Cardiolife) was that there were some quality people on the management team who lacked a sense of direction. Most odd was that the hallways were plastered with motivational quotes – framed posters of great photographs adorned with lofty phrases about teamwork or exhorting people to “Make It Happen.”
When I asked people about them, they all shrugged and said my predecessor had hung them to motivate the staff. It was clear that their presence was widely viewed as a joke. So, I removed them. A big part of my job was to change the culture. Lofty phrases not Continue reading “So, What’s Your Story?”
The following are the author’s remarks at the Financial Leader of the Year (FLY) awards dinner on October 4, 2017, sponsored by the McCracken Institute and Rollins College. This is Part 4 of 4.
To read Part 1, click here.
To read Part 2, click here.
To Read Part 3, click here.
But suppose you’re not a Millennial with the inclination to travel to Outer Mongolia to do business directly with goat herders. (I can tell you that’s not on my bucket list.) Suppose you work for a big company. Let’s say a global corporation… like Nestlé.
Nestlé is an $89 Billion food and beverage company. The company’s mission statement is “Good Food, Good Life.” If you’re an espresso drinker, you may be familiar with one of their products: Nespresso. Perhaps you’ve seen a TV ad that features these guys:
Nespresso follows the old Gillette razor blade business model. Nestle doesn’t exactly give away Nespresso machines like Gillette gave away razors. However, selling coffee in little pods is a very profitable business for them. And, it enjoyed 30% annual growth in its first decade on the market. It’s fair to say that Nespresso expanded the market for premium coffee and, simultaneously created a huge problem for Nestle:
Where would they obtain a reliable source of coffee to feed the demand they had created?
The traditional playbook for procurement managers is to commoditize the supply and Continue reading “Succeeding Without Losing Your Soul (Part 4)”