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Corporate America: foundation for failure
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History shows us that no society on earth can endure forever. The longest lasting was the Roman Empire with its 2000-year reign. But if even the strongest, most well-preserved and distributed culture crumbled to obscurity, what shall become of our country and our way of life? Is it starting to fall apart right before our very eyes?
As the world’s superpower we scoff at the notion that me might ever be overthrown militarily, but there are so many ways in which a nation might fail. Most recently, we have seen the beginnings of an economic collapse that seems out of everyone’s control. The government does it’s best but it does not control our economic prosperity. Corporate America seems to blame. But what exactly is corporate America? It is a collection of independently run businesses most of which are publicly traded and collectively “owned” by shareholders that share no common goals or interests except to be prosperous and grow. As a matter of fact, growth seems to be the only goal that these economic powerhouses have, particularly expressed in revenue growth because it is seen as the best overall measure of success. But aren’t companies in the business to make money? Wouldn’t profitability be a better measure of success? Can’t revenue numbers sometimes be misleading? In fact, they can be quite misleading, and we see many large companies buying out smaller organizations that have been more successful simply to include their “good” numbers with their own “bad” numbers to mitigate an unsuccessful revenue year.
What is interesting is that a company will actually sacrifice its true profit to obtain this perceived success. That successful smaller company they purchased to make their numbers look better did not come with a cheap price tag. They may even be desperate enough to let profitable sales people go in order to clear their salaries to make the year-end reports look a little better.
In the end, this type of corporate behavior has to catch up with all of us. Eventually, these companies will collapse and with them the market collapses. Afterwards, we might be asking why and how this happened. The answer is because we cannot distinguish between reality and perception. When public opinion rules, perception becomes reality, and there is a morale line that is crossed when people do whatever it takes to alter perceptions at the sake of reality. The potential evils of this culture of corporate investment have been our own doing. It’s the American dream to invest wisely, play the market and become wealthy in the process. But if we are always investing in an uncertain future, how much attention are we paying to today? When we follow statistics that begin to drift apart from their realities, should we really be shocked when that illusion crumbles?
There is great concern among corporations today to follow the law and practice what is perceived ethical business. But the problem is that this way of thinking is so ingrained in business culture that its not perceived as unethical in any way. Shareholders want to hear forecasts and sales divisions are under terrible pressure to call an unrealistic number, one that their sales people cant possibly hope to obtain in today’s economy. Can we ask them to have integrity and be more realistic? We should. But who ever heard of someone not forecasting growth? And when the unrealistic growth expectations aren’t met, the shareholders are going to expect accountability. Executive management defends their plan and blames the execution, and then the under performers are laid off and the cycle repeats itself, perhaps this time with a change in V.P. but the end results are always the same.
Perhaps this foundation for failure is already laid too deep and there’s nothing to be done except to stand aside and watch it collapse. Or, we can try to do our part to hold corporations accountable for these unethical practices. The media might have some sway here to draw attention to bridge the gap between the unethical and the illegal. Perhaps consumers might be more wary of buying cars from a manufacturer who participates in mergers and layoffs. If you can afford millions of dollars to purchase a company, shouldn’t you be able to support its employees as well? Corporations might claim their survival is at stake when these layoffs happen, but we know the truth. And when America finally wakes up and decides to be discriminating about its patronage, corporate America will be forced to wake up as well.
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