Ethics - Homespun values in a modern world

I recently began work with a new client in the computer industry. As with any new company one of the first steps I take is interview key employees to get their perspective. After several interviews I began to notice a surprising pattern. All of the employees stated they were with the company because the owners were honest. Honesty and integrity were more important than compensation or job descriptions. The fact that some of the employees were “Generation Xer” techies opened my eyes even further. To create a sense of loyalty and belonging among a group notorious for non-loyalty was nothing short of astounding. Despite its faults, many of which were common to most businesses, this company has been able to attract and retain a number of good employees. Needless to say this company has been expanding steadily and is poised for exponential growth.

The concepts of honesty and integrity are not new. The actual application of honesty and integrity in the new business environment is. As results, earnings and growth-at-any-cost have become standard tactics, honesty and integrity have to a certain extent fallen by the wayside. Ownership often sees better short-term margins by micromanaging and delegating more and more to fewer and fewer. In my employee reviews I hear this as a common employee complaint. When conditions deteriorate and ownership sees margins vanish they call someone like me to find out what is wrong.

I point out the problems and they reluctantly go for the painful cure.

Pain is the motivator until conditions improve and they are able to go back to the short-term gains of micromanaging and exploitative delegation.

When employees feel micromanaged and exploited they naturally take it out on the customers. We all experience this on a daily basis. This is often the first sign of terminal business illness. Customers perceive the business to be rude, incompetent, exploitative and micromanaged.

The dynamics are obvious to an outsider like me. In short, the values expressed by ownership filter through the employees to the customers.

The businesses that do nothing eventually die – customers simply take their business elsewhere. Those that give lip service and half-hearted corrective measures may extend the funeral by beginning a cycle of boom-or-bust.

Unfortunately most businesses adopt these strategies and never reach their potential. Owners become bitter, employees become bitter and eventually the customers become bitter. More and more effort and resources are required to keep the business operating.

I hate these kinds of businesses. Sure, I can get improvement but the improvement is temporary and as soon as the cashflow crises are averted a comfort zone is attained and the cycle repeats itself. These kinds of businesses never reach a “superior” status and are always struggling to maintain the status quo. Having worked for a number of superior businesses, I have perspective and see the potential. Owners who have insisted on micromanaged exploitation have little perspective and cannot conceptually grasp any other strategy.

When our political and business leaders lie, cheat, mislead and otherwise manipulate we become hardened and willing to accept less. We almost expect employees to be rude. Our standards are lowered and so are our expectations.

In the business world the results are mediocrity and pettiness. A mediocre, petty business can be many things but being successful is not one of them.

In reality the old values have never left us. Concepts like honesty and integrity have been with us since we evolved socially enough to understand what they mean. In the old days, if you cheated your neighbour you met the wrath of a non-sympathetic community. Today the consequences are often settled by “impartial” courts.

Even though the new business markets have changed that does not mean the cherished values of the past have also changed. The old values can provide a competitive advantage that can send a business to the forefront of a market. The paradox is that deception may be easier in the short-term but much more difficult in the long-term. I know. I may hate these kinds of businesses but I make a good living fixing the consequences!

Jack D Deal is owner of Deal Consulting in Santa Cruz, California.