Skip to content

The Root Cause of today – the focus on numbers while glorifying the greediest

March 13, 2009

Seeking Alpha, a great source for online business oriented thought provoking commentary and idea flow recently had a posting entitled ‘Why Chrysler Represents the Ills of the New America’, by Steven Hansen, about how America’s current economic issues are the sum of a culture of economic sleight of hand and ‘deals’ as the main means to generate profits. In my opinion, it’s the focus on numbers while glorifying the greediest. And the greediest always use illusion to feed the greed, while reducing people to another line item number on a spreadsheet.

My first job was with Citibank, in Wall Street back office operations as an entry level manager. The Bank was in transition from the business-statesman Walter Wriston to the technocrats. One day, Mr. Wriston came to visit us, sat on top of a desk and talked, not lectured but talked, with us. We would have walked through Hell’s fires for that man and did so during 10 and 12 hour days.

The technocrats took over the bank in the mid-late ‘70’s, mostly McNamara’s Ford Wiz-Kids. Where we would have walked through Hell’s fires for Wriston, we wouldn’t even go out of our way for this new crew and the Bank’s issues today are probably the sum of that dysfunctional culture of individual short term greed satisfaction.

The current culture of Corp America is ‘what’s in it for me’, and this infection has been festering for about 30 years and is now killing the patient. In B-School in the late ’70’s, we were encouraged to be ‘lean, mean and keen’, and so many current senior business leaders are from that school of thought. No wonder that until just recently, our glamorous and growth industries were optimized for ‘lean, mean and keen’ types, which we call ‘boom markets’, followed by suing each other – pretty much like any society in entropy since the dawn of civilization.

‘Hi-tech’ probably has the best culture in America and the rest of us should emulate it quickly. Personal responsibility, balancing fun and work (OK, sometimes it gets fanatical and we forget the home-work balance, especially at the end of a Quarter), sharing the gains over 4+ years via stock options and all the rest make an exciting place for the best minds to work and for innovative products and companies to flourish. No surprise that Citigroup is valued this morning at $10B while Apple is $86.4B. Hi-tech stock options are interesting since typically, everyone from Receptionist to Founder get some Options and when the company goes public, everyone gets a piece of the pie. Short term greedy stupid moves are not tolerated because it could hurt the stock, damaging everyone. And people, the creator of this innovation engine, are still important.

New York City’s Fire Dept (known as the FDNY) has a very team oriented culture which is also full of the big egos you need to fight major fires, but anyone who is in it solely for themselves is labeled a “square-rooter” and God help that person – that reputation will proceed them to every firehouse they go (and they will go to a lot of firehouses since they never seem to quite fit in). Now is the time for business to develop a mid-ground and encourage personal responsibility while rooting out the greedy ‘square-rooters’.

Rich Eichen is a Managing Principal of Return on Efficiency, LLC, who’s website is www.growroe.com and is one of their senior turnaround leaders/CROs, Program and Interim Executives with over 25 years experience reshaping companies and key initiatives as well as operating units of Global organizations. He can be reached at richard.eichen@growroe.com

Advertisements
Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: