“The New Capitalist Manifesto: Building a Disruptively Better Business” By Umair Haque (Harvard Business Review Press, $26.95).
Like the government, business mortgages the future. By focusing on short-term results, business seeks “thin” value — “gains that are largely illusory, and produce diminishing returns every year.” Capitalism used to be a survival-of-the-fittest system. Now it’s survival of the fattest — business-model dinosaurs standing in quicksand, yet deemed too big to fail.
Capitalism needs a reboot. The cost shifting and the benefits borrowing must stop because they only postpone the inevitable — a business world where consumers “spend” tomorrow’s money not on goods and services, but on the multi-generational debt load. Haque’s focus on changing the system revolves around two axioms:
1. “An organization cannot, by action of inaction, allow peoples, communities, the natural world, or future generations to come to economic harm.” The burger that tastes so good today may well leave a bitter aftertaste as consumers confront obesity, diabetes, clogged arteries, etc. The school systems that turn out illiterate high school graduates only set up students for failure, and a life lived at the expense of others.
2. Create more value of higher quality. The events of the past few years show us where creating more and more thin value leads. Haque calls for constructive capitalism based on five cornerstones:
Value cycles, which utilize renewable resources.
Value conversations dealing with market response and creation. Agile companies create innovation.
Adopt philosophies. “Here’s how we’ll make stuff people want to buy.” Companies focus on consumers, not crushing competition or selling what they make. Completion replaces “rush to market” with “make better products.” An example: The $40,000 Chevrolet Volt is supposed to be the “golden child” of the “new” GM. Yet GM’s latest CEO challenged engineers to take out $10,000 in cost. The before-bankruptcy, drawing-board challenge should have been: “Build a world-class electric car that sells for $30,000 and doesn’t rely on tax credits (i.e. cost shifting) to promote sales.”
Shift production and consumption from goods to betters. Put human payoffs before financial payoffs. What’s best for the customer? Nike shifted its focus from must-have cool shoes to designing functional shoes that fit the performance tasks of their customers.
For Haque’s advice to work, consumers have to change their mindset, too. Thinking “instant” satisfaction, like most businesses do, comes with a huge future-dollar price tag.
“27 Powers of Persuasion” by Chris St. Hilaire and Lynette Padwa (Prentice Hall Press, $25).
Ego — yours and theirs — plays the biggest role in persuasion because it establishes the ground rules for discussion. Check yours at the door and stroke theirs. Show that you care; show that you know they’re important. Why? Nice guys aren’t seen as adversaries. By valuing others, the nice guy builds bridges to understanding. They get deals done; they don’t finish last.
The truth of checking your ego at the door resides in Power 4: “Manage opposition by giving it nothing to oppose.” When facing opposition, never use your mouth before your brain. Nod as if you see the other person’s point. Take a few moments to think about how you can react by acknowledging the opposition’s point in terms of reframing the original goal to incorporate the point. The result: You defused the opposition; he/she has nowhere to go. Such action also shows the group that you can find a way to align disparate views.
Power 22: Don’t say no, say “Let’s try this,” getting to “yes” by rejecting “no.” It, too, plays to ego. Always use your goal as your touchstone. When did “No” ever become the answer to achieving something you need? “Let’s try this” begins the process formulating alternatives. It gets people thinking “how.”
The book provides common-sense advice of how to lead and unify.
Jim Pawlak is a nationally syndicated book reviewer.
