We’ve been hearing a lot about corporate greed these days and it’s being blamed for every economic ill imaginable: the credit crunch, the housing recession, the falling dollar, the price of gasoline, soaring health care costs and $4 loaves of bread. Businesses, the critics claim, are riddled with chief executives that create abundance for themselves and poverty for a naïve buying public.
I was reminded of that again when I read an interesting article written by my old friend Neal St. Anthony, a business columnist for the Minneapolis StarTribune. His column, “Investor Greed Hits Home for Bear, Families,” delivers a few well-placed jabs at greed; specifically the sort he sees in the collapse of Bear Stearns.
St. Anthony writes that Wall Street is driven by greed and fear. “What we’re witnessing,” says St. Anthony, “is the disastrous collision of greed, fear and ignorance at the intersection of Wall Street and Main Street.” And he rightfully notes that when businesses go bad—everybody suffers.
St. Anthony doesn’t, however, name names but CNBC does. In fact, the cable network has carried the “greed” theme to an entire program series called American Greed (Wednesdays, 9 p.m. EDT). Dennis Kozlowski, the former CEO of Tyco, was skewered on a recent program. He’s the exec that fleeced millions from his company and now sits behind bars in a New York prison doing 8 to 25 years and cleaning toilets for a living.
The message of this and other series programs is clear: greedy leaders wreak havoc on business, the economy and the U.S. public. And that picture, I think, is only partly right, and it completely misses the point that the antidote for most corporate sins is a generous dose of entrepreneurism.
In my book, Cheat To Win, I noted that “Critics may cite Enron, World-Com, Tyco, Adelphia and any number of rogue companies as examples of pure entrepreneurialism run amok, but I disagree. Rather, these are examples of out-of-control, bloated bureaucratic organizations with cultures that both tolerate and foster lack of accountability, unadulterated greed and fraud at many levels.”
What’s important to remember is that these corporate leaders, just like the CEOs who are taking the heat in this latest financial debacle, created a “corporate culture” of greed and deception. In other words, these executives could not have achieved their questionable business practices without also creating a corporate culture that is both complicit and supportive of that behavior. And since corporations often copycat the sins of others, we shouldn’t be surprised when corporate greed becomes industry institutionalized.
It’s as if these corporate leaders plucked a page from the Gordon Gekko financial songbook and made it the theme song of their corporate choirs. It was Gekko, the stock manipulator played by Michael Douglas in the movie Wall Street, who said, “Greed is good. Greed works, greed is right. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed in all its forms, greed for life, money, love, knowledge, has marked the upward surge of mankind.”
Is there a lesson here? You bet there is. If top management would manage their business as true entrepreneurs, we wouldn’t be suffering this latest fiasco. Entrepreneurialism is not about financial economics; it’s about human ergonomics. The true entrepreneurial organization creates the natural habitat for humanity. A true entrepreneurial culture brings out the best in people, encourages effort to add value and rewards honest achievement. Money (not greed) is not the cause, but rather the fruital result of an effective entrepreneurial system. And greed has no place in an entrepreneurial culture.
In managing your business and your personal life, remember that Gekko was the villain of the story, not the victor. The guiding DNA of true entrepreneurs is to manage their businesses with honesty and fairness to all parties: management, employees, vendors and their customers. And from my perspective, you cannot be successful in business if it’s any other way.