August 26, 2009

Profit and social responsibility. Mutually exclusive?

I’m fed up. I’m really fed up of the business bullshit—the attitude and the rampant narcissism, the lingo and the catchy acronyms, the stance and the phony dance.

Business today, contrary to its supposed intent of exchanging a sound product for an honest dollar, has become entertainment. A diversion, an aspiration, and a television show.

For how long, I wonder, has business been fashionable? Was business always fashionable and it was only me who hadn’t noticed?

For how long, I wonder, have self-important CEOs and money managers been vedettes—celebrities and icons? What, other than their ability to amass (and then blow) a fortune, makes them more important—more notable and more readable—than the workingman (and woman)?

How long ago did the pursuit of money, and nothing but the mere pursuit of money, become so admired? Something to talk about, something to broadcast and write about—in envious and respectful tones.

Why does the press, and the business press in particular, gush with glee over business rationalizations, business mergers and blockbuster buyouts? Do they know—really know—what that means? What it implies?

More importantly, though, what has all this fascination and emulation wrought?  Ponzi schemes and fraud. Cooked books and sorrowful failure.  Madoff and WorldComm. Nortel and GM.

It’s time, I believe, for a rethink.

It’s time to reframe what big business and big finance are supposed to be about.

Just as social media is redefining the dissemination of information, perhaps it, too, can reset the metrics of success.

Rather than obsess on the bottom line, business—and big business in particular—should keep only one eye on that. And the other on responsible customer care, responsible innovation and responsible governance. Rather than growing the business by buying out large competitors (and assuming ever-more debt), corporations should grow their social consciousness with responsible, empathetic action.

After all, is it a given that profits and social responsibility are mutually exclusive?

Only in the hearts and minds of big business, I fear.

Is it time for a change? Is it time to end big business’s seemingly contradictory attitude of narcissism (when they’re profitable) and entitlement (when they’re not)? Yes I believe it is.

Do I expect things to change? Maybe one tweet at a time…

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August 16, 2009

Money: illusion or elixir?

My friend Gwen McCauley sent me an interesting weblink that relates money with an individual’s tolerance of pain or affront.

I love coming across this stuff. Maybe it’s because (insert shameless plug here) my upcoming book suggests that money, as I mentioned in my very first post, is nothing more than an illusion.

Or maybe it’s because it serves as some sort of validation. After all, it’s one thing to make outrageous claims about money in a novel, but it’s something quite different when done in academia.

And yet this article written by Robert Goodier, and published in LiveScience.com, suggests, believe it or not, that money relieves pain.

And it doesn’t do so in ways you might think either. No, the article doesn’t say that having more money relieves pain, it says that pain is relieved by just touching money.

Now, how far-fetched is that?

And that’s not all money does either. As Goodier’s piece explains, experts conducted six separate experiments to show that, in addition to reducing physical pain, the mere handling of money served as “a proxy for social acceptance.”

If you haven’t hyper-linked to the article, let me summarize it for you.

Undergraduates were separated into two groups; one counted a stack of $100 bills, and the other counted plain paper. Then, members of each group had their fingers dipped in 122 F water.

Yes, you guessed it. On average, those that had counted money felt less pain than those who counted paper.

In another experiment, after counting either money or plain paper, each of the two groups played a game of Cyberball.  Unbeknownst to half of each group, they were playing with a computer programmed to never pass them the ball.

While all undergrads playing the doctored version felt rebuffed, those that had counted money didn’t feel as offended as those who had counted plain paper.

Which makes me wonder…. what does it all mean?

Well, according to Kathleen Vos, a marketing professor at the University of Minnesota, it means, “These effects speak to the power of money, even as a symbol.”


Which is, no doubt, true.

What it also means, at least to me, is these experiments prove, once again, that it’s not the actual possession of money that people fixate on, but rather the concept of money.

And, could it also mean, as improbable as it may sound, that maybe money is an illusion after all?

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July 18, 2009

5 ways to know you’re rich

It happened again—an email landed in my inbox guaranteeing me another sure-fire way to make millions. There are, it appears, a lot of people interested in my balance sheet and my financial position—total strangers, concerned about my wealth. Imagine that.

But had any of them read my prior post, they’d have realized they’re wasting their time. The reason, you see, is that, while there is a pervasive belief that life would be so much better with so much more money, I happen to be in a minority position that believes it’s not about the money. Now, don’t get me wrong. I’m not saying I don’t need money, or money’s evil, or anything like that.

What I am suggesting, though, is when we discuss money, what we’re really revealing is our attitude, and our perceptions, about money. That premise of mine, by the way, gets challenged. A lot.

Imagine my surprise, then, when I found this on telegraph.co.uk “A brain scan study has shown that no matter how wealthy you are, money is most rewarding if you have relatively poor friends, peers and colleagues.”

The Telegraph’s article describes a scientific experiment that used scanners to measure the part of the brain where a person’s “reward centre” is located. In their study, scientists discovered that when a participant won money, it triggered a noticeable increase in their reward centre. What was surprising, though, is those same participants registered an even more marked increase in their reward centre when they got more money than anyone else.

All of which, I believe, reinforces the suggestion that it’s not about money, it’s about being richer.

And so, with that in mind, here’s my unscientific list that identifies…..

5 ways to know you’re rich:

1)      Do you earn at least $25,400 per year? Based on statistics from the World Bank, 90% of the world’s population would agree that you’re rich. If you earn more than $33,700 you’re in the top 5% of the world’s income earners.

2)      Own a computer? If you do, you’re rich. Almost 91% of the population can’t afford one

3)      Own a TV? 75% of the world doesn’t. Televisions, I guess, are the trappings of the rich.

4)      Made a phone call recently? Did you know there are about 2 billion people who have never used a phone, ever? Want to feel rich? Just pick up and dial.

5)      Own a car? You, my friend, are rich. 90% of the world’s population can’t afford that privilege

You see? It really isn’t about the money.

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July 16, 2009

Do you prefer a salary of $50K or $100K? Are you sure?

Okay, I’m back. At least until I’m gone again, in a few days anyway–and only for a few days.

After last week’s brief hiatus, I returned to an inbox populated with requests for posts on the money thing. While happy to delve into that area (hey, I’m always ready to ponder and postulate from atop my soapbox), I first want to emphasize that, while my upcoming book might say something about money, it says nothing about money itself.

And if that hasn’t intrigued you, consider this.

Most of us, I’m sure, have an unshakable belief that more money is a good thing. I mean, let’s face it, those are two mouth-watering words there. While ‘more’ and ‘money’ are pretty compelling in their own right, taken together, in one thought process–more money–well, who wouldn’t want some of that?

And yet, when put to the test, it turns out, funny enough, that the majority of people  don’t want more money at all. No, that is not a typo and, no, you didn’t misread that. It’s both a documented fact and the honest truth.  Let me explain.

About 10 years ago, Harvard economists Sara Solnick and David Hemenway conducted a study that asked this question; would you prefer an annual salary of $50,000 or $100,000? Believe it or not, the majority of participants (all of rational mind and sensible acuity) opted for the 50K.

You may well wonder, what sort of preposterous madness was that? Actually, it wasn’t madness at all, but rather something called positional concerns.  And it’s also, on my part, a bit deceptive, because what I haven’t told you is there was a second part to the question. In fact, the offered choice went like this.

Choose whether you get a salary of;

$50,000 while other people got $25,000

OR

$100,000 while others got $250,000

That’s where the notion of positional concerns comes in. You see, it appears we all have a tendency to compare ourselves to our peers. And during that process of comparison, it also appears that we’re happiest when our perception tells us we’re better off than our peers (even if, in absolute terms, we may be even worse off).  Which explains why most people chose option A.

When framed as such, do you think you’d also choose option A? Whether you would or wouldn’t isn’t really all that important. At least not to me. That’s because, to me, the Harvard survey wasn’t about money, but rather the perception of money.

And that, among other things, is what my book addresses.

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