Monday, October 06, 2008

Blame Harvard Business School

"If its Not Growing, Its Dieing"

You want to know whats to blame for your current economic crisis? Greed you say? Harvard Business School says I. Its that theory.. that wretched buzzword style catch phrase... so often repeated... its impregnated every fascit of american economics.

Its a deplorable, loathesome, and ultimate suicidal business theory. Its one that eventually damns and destroys everyone and everything that adopts it... from a business, to a school, to a city or town. But why? Why is it so destructive?

Several different ways actually.. and I'm going to provide some fairly varied examples from completely different, and seemingly unrelated, areas to demonstrate them.

I want to explain the mechanics of why this theory is so wretched. The theory mimics greed. It creates a strip mining mentality. 10% profit is good. Its not bad. But see... 10% profit 2 years in a row... is not seen as consistant performance... instead when you apply this Harvard Business School Abortion of a Theory... its actually viewed negatively. Its illness and death. Its not growth... therefore its "death". So... 10% isn't good enough in year 2. In year 2... you have to have 10.1%... and you'd much rather have 11% or more.

Now compound this attitude with the hype driven world of Wall Street trading. More profit is more hype. More growth is more hype. More hype is more money... more money is more infrastructure... more aquisitions... more growth... and remember.. If its not growing... its dieing.

You ask were the greed comes from? It comes from that mentality. It is the direct result of the application of that mentality... to every aspect of business.

So... Lets look at specific examples...

Lets start with sports... and there is no more obvious example than NASCAR. The drive for growth has driven NASCAR to sacrifice its soul to appeal to "new" markets. This is seen by NASCAR pulling races from traditional south eastern tracks and giving them to California... or Las Vegas... where no one gives a damn. More than that... its seen in the ultra PC turn we've seen in NASCAR bigwigs over the last 10 years. Driver quarells are crushed immediately. Any show of fire and emotion is squashed immediately... all in the hopes to repackage the sport to appeal to new markets. Never mind the fact that the repackaging has pissed off the loyal fans who've been around forever.

NASCAR has found itself in a crisis. For the first time in decades it is boring... and people are ignoring it. Blame the Car of Tomarrow...but the real culprit was their idiotic attempts to market the sport by removing all the aspects that made it marketable in the first place.

Lets look at the housing market. Its all "greed" right?

Let me suggest that much of the Fannie Mae / Freddie Mac contraction can be directly attributed to Harvard Business School thinking. Look.. if everyone that qualifies for a home has one... and has recently financed... you really have a problem. You have to grow... if you don't grow... you die. So what do you do?


You do the same thing NASCAR did... you go find a new market. And if there aren't any new markets... you better damned well create one. After all... its a matter of survival.

Do the math.

And all the while I find myself thinking of that little store up in Oark. The Oark General Store in Arkansas has operated continuously since 1890. Its the same general store today that it was 100 years ago.

It has not grown.

And look at that...

It has not died.

That's because 10% profit... over and over and over again... is successful business.

10% profit... followed by 20% profit... followed by 50% profit... followed by 60% profit.. followed by bankruptcy and collapse... Well we have a word for that to... We call that failure.

You want to fix the economy?

You can start by razing Harvard Business School... and salting the earth.

No comments: