Wednesday, February 11, 2009

Is there something wrong with the economy?

I have to get this off my brain.

There are a number of fundamental problems with large numbers of American businesses. These problems can only be fixed from the inside out. The government can prod businesses and regulate but it is really up to the business community to make their way out of a lot of the messes they have created.

Some are going to read this and call me a socialist or an idiot, or worse yet, an idealist; call me anything you want. For the record, the only one of those three I have not been is a socialist.

Most of the businesses in this country are run for the benefit of stockholders. I don't have a problem with that idea at all. In the simplest of examples, if the stockholders are risking their investment to start the business, they should reap an equitable reward for taking the risk. If that relationship doesn't exist, we will lose the risk takers. Not a good thing...

The problem comes in how many businesses prioritize the components essential to running a successful business. This is the way it has worked for us. This is the thing that makes me extremely proud of what we have done over the last 20+ years.

Priority 1 - Employees and their families
Priority 2 - Customers

Simple. You take care of your "families", they will "go to war" for the company. Again, simply put, if you make your employees feel the "love", your customers will also feel it. Treat them with respect, Happy customers equals happy owners (stockholders).

This is the ideology or framework, there are obviously a lot of details in constructing a useful business. If you use this ideology to create a business for which there is no market, you may be great to your employees but there are no customers...big problem. Recognizing the need for your product or service is an example of one of the important details.

If you are not being equitable to your employees, the lack of equitable treatment will extend to your customers and it follows that your stockholders are also at risk of being cheated. Is there any chance that a business run like this is good for the community? adds value to society? has a chance for long term success?

While I have used the word "simple" several times, I have not used the word easy. This is not easy. Competing is not easy but we are not afraid of competing. I just think that competition does not mean that you have to give up the qualities that make you a good citizen of this world and in fact, I don't think sustainable success is achievable without contributing to furthering the greater good on some level.


Barbara(aka Layla) said...

This is an EXCELLENT business model. If your an example of an idiotic idealist - then I think the world needs a lot more of them!

Wonder Boy said...

Thanks Barb. It would be idealistic only if it were unachievable for some reason. We did this and it works.