If we consider that the value of a company is proportional to its profits, the company that gives half its profits to charity is only worth half as much as the company with the same profit that gives nothing to charity. If someone were to buy the first company, change management so no profits are given to charity, now the company is worth twice as much and the company can be sold with a 100% profit.

That is what the people who took over Simmons did. They didn’t add any value to Simmons, they simply liquidated the value that was already there but not accounted for in the stock price.

This is sort of what the neocons and the Religious Right did to the traditional republicans, and what the teabaggers are doing now to the neocons. The GOP “brand” was under valued because there are a lot of republicans who are not willing to go out and be active except on election day. Those sheeple added a lot of “value” (i.e. votes) to the GOP “brand” but those votes didn’t need to be paid for with actual policies that made sense because of brand loyalty. Those who are willing to call themselves republicans and be active have a disproportionate impact on whatever political positions the republican party takes. This is how you can get positions that make no sense to traditional republicans. People who want government out of their lives, but into the bedrooms of everyone else and the uterus of every woman. People who want the government out of Medicare and Social Security but want subsidies for everything else.

The ideas make no sense, but if people are willing to vote for them, it doesn’t matter. It is the same as a company with a “good” name selling crap. It doesn’t make any long term sense, the seller is liquidating the good name of the company. It only makes sense if people don’t know what they are buying. Same as in politics.

http://www.nytimes.com/2009/10/05/business/economy/05simmons.html

You can liquidate the good will of long term employees by paying crap wages, but after a while there is no more good will and no more good employees. You can liquidate the good will of your customers by selling crap products for high prices, but that only works for a while.

The people who bought Simmons were not interested in whether it survived or not. If you can liquidate the good will faster than the market place realizes the good will is being liquidated, you can end up with more than the good will is worth. But once that good will is liquidated, it is gone.

This is an aspect that has always troubled me about the corporate mindset, to pre-screen people who will “fit in” to an all ready existing culture. It worries me because it is very similar to inbreeding in genetic weaknesses. Without the infusion of diversity in background of people to contribute to the corporation, serious problems occur; leading to groupthink and other problems. The members of the organization tend to focus on pre-set goals without stopping to question whether the goals are actually beneficial. If the organization focuses intensely on making widget “A” and R & D is all focused on making widget “A” more better, and marketing focuses on making “A” more palatable, profitable and salable, and customer support is focused on making widget “A” more usable, when financial resources are sunk into all of “A” but no one bothers to check to see if widget “B” may be instead the better product, then the corporation will be sunk in the long run. Unless it gets a monopoly and the public decides that widget “B” is too geeky and unapproachable.

Corporations need “shit disturbers” so that they question their goals as much as strive to achieve them. I wonder if General Motors and Chrysler would be in as much financial trouble as they are in now, if they had hired people who would have stopped them from putting all their energy and resources into designing “bigger, badder, stronger, meaner” cars and trucks while the long-term market trend should be towards more fuel-efficient vehicles; if one of their board members would have stood up and said “Hey, gasoline is not in infinite supply!”

To find people who will broaden the reach and scope of the company, they really should focus on broadening the reach and source of the people they want to join them beyond “priority schools” and consider the implications of diversity in their hiring practice to include people who have variant cultural and educational backgrounds. Not knocking schools such as Harvard, Yale and Stanford, but good leadership and education can also be found at smaller and less prestigious schools; and if the intent is to squeeze the creativity out of people once they are hired then why worry about which school they went to in the first place?

I do think that a better understanding of evolution illuminates the issue, MPL. A broadened gene pool benefits species and ensures a greater chance of survival should disaster strike, and the business world should look to the biological and anthropological sciences to guide them in adjusting their hiring practices.

Segregating and separating race and class into discreet units may be useful to the power structure for their own selfish, capitalistic goals, but if their overall concern is towards the long-term health of the organization then breaking down the units is a counter-intuitive, yet important process.

I overheard some middle aged, upper class, white men on the train this weekend, who were responsible for some sort of hiring decisions at their firm, complaining about their issues with finding “diversity hires” [sic].

While some of their complaints were possibly reasonable (e.g. otherwise qualified candidates who speak English as a second language could conceivably be the wrong choice to send as consultants to work with your clients), the amazing bit was that they seemingly managed to identify some of the sources of their problems, but never shook their feelings of absolute rightness. They reject candidates who don’t fit into their “corporate culture”, even though they don’t have any proof of the usefulness of their culture (other than, I suppose, ‘that’s how it’s always been done here’). They focus their recruitment on certain “priority schools”, which have few “diverse candidates” to start with, and of course, they face steep competition from every other big employer in the country.

They are looking for people who fit without effort into their existing company. Of course, that means they want people with assertive (i.e. ‘masculine’, ‘individualistic’) personalities, with ‘accentless’ English (i.e. middle-class American White English voices), with “priority” school backgrounds (i.e. expensive, upper-middle-class biased elite schools). Some of the issues they can’t do anything about (e.g. if you really do need a specific university degree for your job, you will inherit any race/gender/class bias that comes with it), but others they could reconsider and change.

But they won’t. They were awfully defensive about it for two friends talking to each other on the train.

Yes ,there is a price, and it is paid by …. THE RICH!!!! Long live the rich!

I’m not saying that wealth redistribution isn’t very good at doing some things – I’m just saying that it comes at a price and it’s bizarre that the advocates of this policy never acknowledge or discuss the price.

Also, remember that enfranchisement was limited to property owners in the early part of U.S. history and so they had quite the head start.

Scotlyn, agreed! And I am not, in any manner, sucking up nor brown-nosing the editor here at Quiche Moraine.