The vast majority of business practitioners that I have met and worked with throughout my career are caring, honest people who one would generally regard as striving to be morally and ethically responsible. They don’t particularly want to run companies that have to put the squeeze on employees and lay them off during tough times; they don’t like being viewed as massive polluters or plunderers of the planet’s resources, and they are very concerned about any issues with their products that are deemed to be “faulty” in any manner. These same business practitioners spend a great deal of their time and energy trying to understand and manage these issues within the scope of running effective and profitable businesses.
Here in lays the heart of the problem: whatever actions they do take on any of these issues has to be looked at through the filter of “how does it impact the immediate and ongoing profitability of my business?” And unfortunately when viewed through that filter, any real and meaningful change to “detoxify” the nature of the business’s relationship in actuality goes “against the grain” of how the business operates. So even the most concerned business manager can – in reality – only make small, incremental reductions in the overall toxicity count of any business.
Consider the following hypothetical – but very typical – example of how this plays out in the daily life of every company, big and small:
Manager 1: We’ve been getting some local complaints again about the factory emissions. It seems some of the kids in the nearby school playground have complained about sore eyes and raw throats. It was a big discussion point at their recent PTA meeting, and we got a pretty rough ride with a bunch of the parents – we found out from a couple of our employees who have kids in that school.
Manager 2: Are we within our legal discharge levels? Has anything changed in terms of our setup or general compliance levels?
Manager 1: No, nothing has changed on our end, and we’re still within all legal levels. It seems it happened over the past couple of weeks under some fairly specific wind conditions, and coincided with the start of little league baseball practice.
Manager 2: Oh, OK. Is there anything we can do that would help out? What kind of alternatives have you looked at?
Manager 1: Well, there are some new pollution abatement technologies that we have been reviewing for quite a while, that look like they would make a significant difference. We’ve tentatively put it into the capital budget for next year; it’ll be a $500,000 hit once it’s up and running.
Manager 2: I can’t see the company going for that. Current projections are that this plant will be mothballed within 5 years, once the new place in Spruce Valley is fully commissioned. We won’t see a lot of investment here. Got any other ideas?
Manager 1: Well, we could re-jig the work schedules so that the factory only ran at night – but that would be pretty disruptive for all the employees. Other than that, there’s not much we can really do about this.
Manager 2: Yeah, I agree. I certainly wouldn’t want to do anything further to upset the employees, not after last month’s layoffs. There is still a lot of pain and hate in the air over having to lay off so many employees.
Manager 1: Not like we had a choice – we’re way off our numbers and barely profitable even after the layoffs. The shame is that so many “lifers” had to be let go. There aren’t a lot of other companies that paid as well in this town, and it’s going to be really tough on those guys to find another job.
Manager 2: Man, some of those guys worked here since they first opened the plant in the 50’s. I really feel for them – it’s going to take a long time for people around here to put this behind them.
Manager 1: By the way, we got one other new development that looks troubling. Looks like one of our suppliers scrimped on some packaging, and we got half way through the production run before some eagle-eye on the line noticed a cracked component. Once we checked it out it turned out most of the components were defective. We’ve had to stop the line while we work through what to do.
Manager 2: Oh, man. This could be painful… All the suppliers to this plant have been approved as preferred vendors, so we don’t do any incoming inspection. What is the Quality department saying about this?
Manager 1: It looks like the supplier’s supplier of packaging made some changes recently to meet some cost demands placed on him by our supplier. Our supplier tells us he needed the reduction in his costs so he could meet his cost targets laid out in our new contract. Apparently there was a review and sign-off of the packaging changes by our supplier, but this type of packaging has never been used in our transportation configuration – so it didn’t quite work out as planned. They’re going back to the initial packaging for now but that’s only a short term fix.
Manager 2: Well, that’s a nice cock-up. What about our production run? How bad is the product? Can we salvage it, or do we need to rework it? That could be expensive…
Manager 1: Actually, it looks like the cracks are surface fractures only, so we think the gas container shouldn’t leak. In normal operation, the product should work just fine. Just to be safe, we’re having Legal look over the situation and make sure we’re covered, liability wise.
Manager 2: Well, that’s a relief. We sure don’t want to have to rework that product if we don’t have to. Once the customer accepts it formally, it’s no longer our concern. Just to be on the safe side, though, we should probably tighten up our inspection of these components until this all gets sorted out.
Manager 1: Yeah, I talked to Production about that already. Unfortunately when we were initially awarded our ISO compliance we downsized the QC department, and we took out a few more of our remaining inspectors in the latest layoff. Quality tells me that’s why they haven’t been able to keep up with the supplier audit schedule that they committed to, so we’ve definitely got some problems here. If we don’t address it soon, we may loose our ISO certification when we have to re-certify.
Manager 2: Well, I’ll leave it with you to sort through this one. Keep me posted if anything changes. In the meantime, I’ll talk with Joe about going over to the school and making a peace offering around the emission levels. Maybe we can sponsor a field trip or donate to their library program again. It’s important that we keep good community relations.
And so it goes. I don’t know of any experienced business person who wouldn’t resonate with the business logic and pragmatism of the above scenario. In fact, at a personal level the managers have significant concern and sympathy for the various stakeholders facing these problems – the community, employees, customers — problems that they spend time and energy trying to determine what they might actually be able to do, and how significant the issues really are.
Fundamentally, the logic of the corporation drive its’ managers to do everything with regard to a perspective and imperative of maximizing profits and thus the baseline behavior we get as “standard operating procedure” from today’s company is very similar to the hypothetical conversation above. And unfortunately, all the “good will” and mantras about “corporate social responsibility” and “being a good corporate citizen” just can’t change the “hardwired” ways of the modern corporation.
