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> Because the new approach makes more money, its triumph is inevitable. If only this were true, then the current problems would never have arisen. This new app
by dwc 14y ago
> Because the new approach makes more money, its triumph is inevitable.
If only this were true, then the current problems would never have arisen. This new approach isn't wholly new. He quotes Peter Drucker and mentions Toyota, after all. Otherwise the observations seem largely correct, and I can believe in a shift where people again begin to believe in this sort of approach.
- drucken 14y agoThis is actually a very old idea, but seemingly still quite new to many American companies and US MBA programmes. Several non-Anglo American corporate cultures and capitalist systems have always worked like this or done so for a long time. For example, the Swiss, German and Japanese home-grown companies. The failure of the SVM model was made high profile due to two quotes from General Electric's former CEO, Jack Welch across a time-span of approx. 30 years. It is only now, perhaps also as a result of the financial crisis, that the negative synergy inherent to the "Unholy Trinity" of: 1. Debt as a vehicle for growth (applies to economies too), 2. Excessive executive total compensation (including growth of professional shareholder class), 3. Shareholder Value Maximisation, is becoming clear. As hinted above, other systems focus on, e.g. generating customer value and cash first, executive compensation tightly linked to both company performance and compensation levels within the firm, shareholders take a backseat or are strongly tempered by long-term stakeholder interests, etc. Oddly enough, some of the most successful US companies generally already follow or followed these customer value and cash-flow oriented principles from the start. For example, the tech companies, Apple, Microsoft and Google.