Businessmen fail to justify capitalism
In the midst of the worst economic crisis in 70 years, business needs to clearly communicate the benefits of capitalism. Being able to articulate the advantages of the market system to audiences in an authentic and compelling manner is a necessary skill for executives facing skeptical or hostile audiences (workers threatened with redundancy, investors suffering losses).
Too often, those who defend the market system are the system’s worst enemies, claims John Kay in today’s Financial Times. He lists a series of business leaders claims which strike a false note:
- Talking about “wealth creation” while actually diverting money to a few individuals rather than creating new wealth for all.
- Thinking private sector activities – securities trading or auto manufacturing – creates wealth while public sector activities – healthcare – use it up.
- Arguing that financial rewards are the mainspring of innovation. This was not the main motivation for those like Sir Tim Berner’s-Lee when he invented the Web, or Steve Wozniak when he tinkered at the Homebrew Computer Club. Nor is it the primary motivation of the hundred’s of PhD’s choosing to work at places like HP Labs rather than launching their own start-ups.
- Justifying excessive financial compensation of senior managers as necessary performance motivators while condemning those who work in the public sector as too lazy or ineffective to get jobs in large corporations.
Kay concludes:
The complacent sense of personal entitlement these corporate politicians expressed was deeply unattractive: as unattractive as the similar sense of personal entitlement displayed by the lazy teacher who knows he will not be fired.
In contrast, he suggests:
Young people looking towards the world of work should understand that the greatest reward from a job is the satisfaction of doing it well. The people who are most successful in business in the long run are people who are passionate about business – whose aspirations are to bring new products and services to market, to serve customers better, to motivate their staff to greater efforts. And, by the way, you can make a lot of money in the process.
For corporate executives wishing to communicate authentically in 2009 the lesson is to be honest and straightforward with audiences. State where your self-interest lies. If there is bad news to deliver, address it early and show a human-level understanding of how it affects your employees, customers and partners.
2 Comments so far
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If more of the same creates more of the same then the US is ready for a change, or to no longer be a competitor in the global market. Either choice is fine, but I prefer to adjust course.
Great post Ian,
Lee
By Lee Rodrigues on 01.07.09 10:34 am
Check out Hazel Henderson’s website. She is a dynamite speaker and very caring in her approach to finances. See: http://hazelhenderson.com/
By Ellen Taliaferro on 01.08.09 9:09 am
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