Let’s applaud the good news first! Some people seem endlessly creative in their work. They are capable of nearly continuous positive innovation. They see things in ways that most of us cannot see. They bring us new and better products, processes, and understandings. Some other people show flashes of very valuable inventiveness from time to time. Others less imaginative in their work still muster the willpower to learn best practices and apply them. I tip my hat to all those builders of a better world and hope they will make a lot of money from their contributions to our lives. You are included in that group, of course.
However, those individuals constitute a small percentage of our workforce. They are far outnumbered and are often ignored by people who are willing to make more money in a less enlightened and more destructive way.
Some years ago, I spoke at a training conference in Budapest for education advisers from many countries in the region. They operated information centers in their countries for students who were considering study in the United States. Most people don’t know that the recruitment of international students is highly competitive worldwide. Foreign student enrollments are very important to universities and to receiving nations for reasons of revenue, cross-cultural education, and future national security. The education advising centers were related to the State Department, and the advisers were accustomed to funding from the United States government. Recently, however, the advisers had been told they would need to raise some of their operating funds themselves. In general, the advisers were not born business types, and the requirement to somehow raise their own money was daunting to many of them.
I knew they could make some money because they were providing a valuable service and because they probably could generate income from many businesses that wanted to sell goods and services to prospective international students. However, in doing so, the advisers could encounter some hazardous ethical situations. Whereas their advising centers were educational and cared first about the students’ welfare, the businesses were for profit and cared first about the students’ money. The prospect of less experienced education advisers working with experienced predatory businesses was fraught with potential harm to students. For example, an advising center might sell student personal information and even refer students to unscrupulous recruiting agents. My job at the conference and at similar conferences elsewhere in the world was to alert advisers to some ethical risks and present some strategies to manage them.
I began the speech by sympathizing with the advisers’ financial plight. Then I announced the good news that plans had already been made for them to raise the money they would need for the coming months or even years. If they would do as I instructed them during the coming weekend of the conference, they could fly back to their countries on Monday with lots of money. First, the physically attractive advisers would become prostitutes for the weekend in venues I had already arranged for them. Other advisers who were quick would rob jewelry stores that I had already cased for them. Others who were strong would work in the parks mugging people, and I had already mapped the best locations and escape routes. The advisers who were artistic would make disguises for the thieves, and I had bought the supplies. Others would play supportive roles such as look-outs and drivers. I would provide alibis for everyone as participants at this State Department conference. On Monday they would fly back to their countries with their loot while the local police were still writing reports. The audience was, shall we say, surprised by this plan.
Then I confessed that the plan wasn’t real and made my point to them, and now to you. It is easy to make money. All you have to do is lower your standards. (At the conference we then discussed how to make money ethically.)
A few recent news stories may illustrate the point of lowering standards for short-term gain. Apple deliberately slowed down its older iPhones to generate new phone business. Volkswagen programmed its vehicles to turn on their full emission controls only during emission testing. Wells Fargo used its customers’ personal information to create fake accounts that generated millions of dollars in fees. This list could go on and on. Every day in the news you can read about standards lowered for the sake of short-term profit. Most Americans seem unaware or unconcerned about such business behavior. They seem to accept it with the same dismissive attitude as the old “boys will be boys”. Corporations will be corporations.
Businesses move their production to countries with lower standards of environmental protection, pay, working conditions, and taxation. Promoters broadcast blatantly misleading advertisements. Manufacturers produce and retailers sell unreliable products with an option for us to buy insurance in case their shoddy products fail. A company that makes an inferior product buys the rights to a respected brand name so it can sell its cheap product under that quality label. A business takes more profits rather than modernize its physical plant and production processes. Businesses that should be competitors find ways to collude and gouge customers while avoiding prosecution under anti-trust laws. This list could go on and on. I once asked a dean of a business college at a large, supposedly-Christian university about the ethical training of the students in his college. He chuckled and said, “We don’t use the E word.”
The lowering of standards for financial gain is not limited to the business world. Universities lower their admission requirements. Religious leaders preach self-serving messages that their congregations want to hear. Politicians do the bidding of their financial backers. Health care providers recommend unnecessary and ineffectual services. The news media replace critically important but expensive investigative reporting with inexpensive entertainment stories.
Unfortunately, the lowering of standards is not isolated to individual companies within an industry. It spreads like a disease among similar businesses because they are in competition with each other. This contagion may be easier to understand at the level of local business. Suppose a town has ten roofing contractors. They bid on the same jobs. One of them starts quoting lower bids because it has begun to hire illegal employees for less money. What are its competitors to do: keep losing bids, or follow suit and hire cheaper employees? Sometimes the cost-cutting comes from cheaper materials. Sometimes it comes from cheaper processes. Similar forces are at work among gigantic competitive businesses such as those cited in an earlier paragraph. Managers who compete in the lowering of standards think they are doing what is necessary to get ahead or at least to keep even with their competition. They don’t realize that actually they have joined a race to the bottom.
Meanwhile, most notably in Japan since World War II, many foreign corporations have embraced the principles and practices of Total Quality Management (TQM) to bring better products to market at lower prices. Of course, with better products at lower prices, their industries such as electronics and most recently sedans have taken over the American marketplace. American companies trapped in their archaic management mentality thought the key to success must be the lowering of prices based on cheaper labor; but after moving their production overseas for the cheaper labor, they found they were still losing. Their handicap was not the higher cost of labor or materials. Their handicap was their own outmoded management systems (and, I suspect, their arrogance). The Americans were, and are, competing against the worldview of Quality Management, which fundamentally and essentially respects its employees and customers. One very brief history of Managing for Quality is at https://www.qualitydigest.com/dec/juran-2.html
A few years ago, I attended graduation ceremonies at a prestigious law school. A series of high-powered speakers offered their wisdom. However, the only worthwhile idea that has stayed with me came from the graduating student speaker. He said ambition is what you are willing to do to get ahead, and ethics is what you are not willing to do to get ahead. While so many individuals and businesses are willing to do anything for their trip to the bottom, I’m happy there can be ways to prosper financially while behaving ethically. Indeed, there are ways to make even more money because we behave ethically. For example, the principles and practices of Quality Management based on respect for people have already been proven. The question is whether enough Americans are psychologically capable of adopting them.