… OR RATHER HOW WE HAVE SEEN IT UNTIL EARLY 2020
For update on our understanding of the world today please go to Covid – Thoughts
The purpose of this folder is not to preach. The reason we lay this out, is that we want you to know how we see things, what our values and priorities are. Maybe (probably) you see the world in a similar way, maybe not. This provides a platform for mutual understanding early on. We are delighted when we help an organic farm or work with a client to find renewable energy solutions, but we do not shy away from “dirty” business. We have always been in business of improving effectiveness, lowering wastes and minimizing losses. Improving operations of a polluter can have a truly significant, positive impact.
WINNING AND SUCCESS
This world is not about “winning”. Jack Welsh is not our hero. He is not a villain either. He represents one of the many views. It is so nice to win. But life is not all about winning by an individual or a company. It is about all of us winning in the long term.
Life can no longer be about winning. It is about balanced sustainable growth. Business should no longer be about pushing sales and indiscriminate marketing. “To each according to the needs we create in him/her, from each according to his/her ability to pay).
It should be about understanding the need and into them, and then providing solutions in an affordable way. And it should always be about making this world a better place, healthier, happier, more beautiful. Some people say it all boils down to money. No, it does not. Money is just one of life’s KPIs. Life is rather about success. Success as per Ralph Waldo Emerson’s definition.
“To laugh often and much; To win the respect of intelligent people and the affection of children; To earn the appreciation of honest critics and endure the betrayal of false friends; To appreciate beauty, to find the best in others; To leave the world a bit better, whether by a healthy child, a garden patch, or a redeemed social condition; To know even one life has breathed easier because you have lived. This is to have succeeded.”
In the bigger scheme of things, the world no longer needs growth achieved by budgets and push marketing goods people do not need or worse are even detrimental to them. That paradigm must shift as otherwise we will use up resources and burn ourselves out (also in the literary meaning of that word). We see this paradigm slowly shifting, yet much of business is entrenched in inertia. We want to be part of that change. We believe that growth should and will continue in a sustainable way.
WORLD IS MUCH BETTER PLACE THAN WE THINK
Here comes a summary based on – Hans Rossling, Gapminder, Factfullness.
ORGANIZATION IS A SET OF PEOPLE
And so, an organization works well if they can form a productive, motivated team. It is people, who take care of its machines and processes, watch for waste, losses and look out for improvements. Their motivation and unlocking their potential is the key to good results.
There are many types of organizations and many types of people. Some people work best in strict military style discipline, some thrive in warmer climates. We recommend reading “Reinventing Organization” by Frederic Laloux, who explains that concept.
The “teal” organization he describes is perhaps an extreme, and we are not sure every organization should go that way. But people in general want more trust, respect and empowerment and they are eager for chances to earn it.
It is important that every organization understand itself and understands where it wants to be. Clarity is important. The worst thing that can happen is an organization that claims while operating in the old way.
We believe that good planning is a key for every effective organization. Budgets are necessary as they provide predictability. But we have seen many serious issues of traditional, inflexible budgeting approach. A lot of work, a lot of unnecessary spending to use the budget before the end of the year or expected cut. Buffering, beefing up. But even bigger downside is the damage to creativity and flexibility of the organization. Especially if shifting between allocations are not allowed.
We recommend the book, “Beyond Budgeting” though we don’t always recommend the approach.
We believe in free market, and freedom in general. Especially in personal freedom. But it is another subject. Happy to discuss it with you at some point. But there are some issues especially in the way financial institutions operate and damage they can make. It became clearly visible in 2008.
It has been best described by Adair Turner, the man who handled the 2008 financial crises in the UK in his book “Life after crisis” [Tytuł muszę sprawdzić]. What he states is that the industries that add actual value – manufacturing is the best example – should be fee to compete and the result will always be good for consumers and society in general. However, the purely speculative activities – financial derivatives being the best examples – should be closely watched and regulated. For more explanation and insights, we recommend you take a look at his book.
You already disagree … you are a firm free market believer. There is another book “Only Capitalism” by the same author but written before 2008.
We believe in the system that allows, freedom as it leads to ingenuity, innovation, and progress. But, we also believe in compassion and social safety nets. And so, we also believe that certain checks are necessary to avoid unfair exploitation.
ROLE OF A COMPANY
There is much discussion of the role of the corporation today and it is difficult to summarize in a few lines. In August 2019 The Business Roundtable caused a stir by redefining purpose of the company shying away from the dogma that increasing shareholder’s value should be the sole objective. Companies should also look out for the interests of customers, suppliers, workers, communities and respect the environment.
But there are some risks with this approach as “The Economist” put it,” If companies had not focused on their core activities in the sixties and seventies, we would today still be driving gas-guzzling, unsafe cars.” [Link to September 2019 Economist letters discussions]
In summary, we very much agree with Andrew Carnegie’s summary: “Surplus wealth is a sacred trust which its possessor is bound to administer in his lifetime for the good of the community”. Being an owner is being a custodian with responsibility to all stakeholders.
CHALLENGES IN THE CHANGING WORKFORCE
The first change is that there should no longer be such a word as “workforce”.
Young people no longer want to work in a dirty noisy environment in the “old way”. The millennials are not the problem it is how we treat and train them. Maybe some of them have unreasonable expectations, but most of them expect respect and fair treatment and that is not unreasonable. Companies must be open to employ diverse individuals, often immigrants and treat them well. New employees will no longer put up with what was happening a generation ago. Companies that treat their people well have fewer issues.
[Here I will put a chapter about the education in general, how the system designed in nineteenth century burns young people out, demotivates them, sucks the energy out of them. Does not develop creativity and understanding skills, but tries to turn them into an outdated Wikipedia while killing their curiosity and passion
In our opinion we live in a “transition period”. Recent years have uncovered rocks of the present paradigm, where value is created by sales force pushing growth leaving most people of the organization burned out, machines abused and environment depleted and polluted.
As SPL we do not push, but ty to “tune into” our client’s needs. In turn we like to work with clients that also “tune into” the needs of today’s world. Strive to make the world a bit better. Companies that make things that people want, need and are good for them. Companies that work on reducing their environmental impact, contribute to reducing poverty and improve well-being of people.
[will expand in a fee lines the concept and the trend]
[Will expand Manufacturing company is like a physical system]