Saturday, December 18, 2010

Arguments with Myself: Entrepreneurship Redux

I wrote on this blog that my career in business is more or less over. That was earlier this year. I was feeling burnt out, which I wrote about over and over here. I came to a point of a general disregard for the business culture of the day and found nothing similar to the romanticism I felt about my grandfather's profession - being one's own boss, having customers who were treated with respect and who gave respect in return, and having a high standard of professionalism and integrity (which, in lay terms, translated into keeping one's word, paying on time, being honest and transparent, paying one's taxes and never committing to bite more than one can chew).

I say this is the romantic conception of entrepreneurship because this, in my experience, is passe. My take is that such things/ values become out of date as 'making money' took over the world. In the Gordon Gekko world, such things like parsimony and humility were indeed out of step. Today's entrepreneurial culture, I observed, are guided by a different set of values - of consumption over independence, of showmanship with respect, of risk over restraint, of getting away over getting in. I was very much part of the culture - I thought businesses were built with the objective of being sold to moneymen and making millions. That was indeed my own contradiction: I was expecting the values of the business my grandfather built and sustained through his lifetime (60 years to be exact) combined with results of today, a sell out in three years.

I have now understood the essential problem. The two are indeed incompatible. My grandfather worked with employees and suppliers over half a century, and they were as much family to us as anyone. You can't get that if you want to start with the end in mind - a sell-out in three years and a few millions to be spent on a home in Spain. It is difficult to judge right or wrong though; the attitudes may be quite grounded in the values of the age. I can argue my grandfather bought mahogany furniture so that they last, while I would prefer Ikea so that I can change them in a few years.

Indeed, some things remain the same. For example, you pay when you promised to pay. My current exposition to Indian businessmen whose cheques bounce as frequently as they get honoured is quite horrifying anyway. But these are only a few areas which may have somewhat remained the same. The concept of respect has certainly changed: From the rather 'feminine' concept of respecting everyone and building relationships, we have moved to the more 'masculine' world of achievements and selectivity. Not biting more than one can chew will be definitely termed unambitious in today's day and age - not the mark of an entrepreneur. However, I shall recall that the first English sentence I ever learned was 'Cut your coat according to your cloth', though admittedly I have worn coats without backs in most of business endeavours.

However, I shall claim that despite my inconsistencies, I get the problem. In this particularly optimistic Saturday morning, when I make a break with the past, I would love to believe that collectively, we are turning a corner. The modern business values that I mention, the ones which seduced me so deeply that I forgot the core lessons of my grandfather's success, are the ones which have driven us to the brink. The low price of cheap credit, leading to a global underestimation of risk has caused a severe economic disruption, big enough to warrant a re-examination of what business stands for yet again. Suddenly, there is oomph in responsibility, respect is most decidedly sexy. The showing off party has resulted in the melt-down and the emperors lack of clothes are being whispered about: This recession may help us discover a new way of doing business.

I am not certain this means going back to my grandfather's values. However much I admire it, and claim my lineage, I wouldn't know whether it is possible at all to go back. Life has accelerated, to start with. The possibilities that exist around us are more than ever before, and hence what can't be done is less certain than what it used to be in Edwardian age. But, I hope that the new business environment will bring in a new definition of risk, respect, relationships, reward and rightness.

For example, I would think we shall move from the current, narrowly held, definition of risk - which is primarily defined in financial and regulatory terms - to a broader one, incorporating environment and social perspectives. This is because these two rather passive factors in the business environment will increasingly became active and agitating. We shall see the fragility of environment, expanding the conception of risks, and more social activism and common interests emerging among diverse social groups and across geographical boundaries. The 'fordist' control of Mass Media is indeed seriously challenged by preponderance of social media. The public discourse is increasingly turning from broadcast to conversation. This, hopefully, will now enter the premises of modern business and shape the new risk assessments.

As far as respect is concerned, we are at a different sort of crossroad. Till this point, it felt as if we are at a point of departure in the history of the human race, where a new super-race would most certainly emerge. With the advent of neuroscience, nanotechnology and advances in genetics, indeed, this super-race may have a much longer lifetime (and immortality at some point) and a healthier and happier life. This super-race will have the best of education and will be pre-ordained to lead, businesses, communities and countries. In this Utopian vision, we, mere mortals, were destined to a life of complacent subjugation, where our lives can be arranged like a reality TV show where we are given a chance of 'making it' if we are ready to trade off our freedom and privacy. So, the idea of respect was defined in an one way fashion, clearly based on a few markers and symbols. However, I shall argue, a new peripheral vision is suddenly emerging within this techno-tunnel. The inherent tension between this one-way model of respect and recognition is becoming apparent. The inclusiveness of technology-enabled social networks are trumping the exclusiveness of privilege based old boys club. At the very point of its complete triumph, the concept of super-race is turning uncool. This isn't the Edwardian view of respect, steeped in good manners but shrouded in exclusivity, but a new emergent paradigm of the age of William and Kate, and the feminine element is indeed omnipresent. In a way, respect is social and the businesses must adapt to that.

The same goes with relationships. In this 'who you know' world, the context of relationships are broader than who you went to school with and who lived two doors down from yours. It has pervaded the personal space: Of love, friendships and conversations. It has taken over work, of collaboration and competition. One may complain that the 'deep' relationships of the industrial age has been replaced by the 'shallows'. I can imagine my grandfather shuddering at the thought of me sharing my business ideas with someone who I have never physically met, or will not meet. But I shall argue that this is only a natural progression from 'social markets' to 'free markets' to 'Virtual Trust Markets'. The trust here is not in knowing the past, as the Edwardian Businessmen would have thought; but it is based on the inescapable nature of connectivity, that you can't possibly go away, because the values produced today reside not independently, but inside the connectivity. In short, you are worth your network and hence, you can't go away. This changing relationship is yet to hit home for businesses, particularly the small ones; but, I shall argue, it is now winning friends and influencing people.

Reward is another such area. The days of 'making money' (the expression which evokes the erotic percepts of 'making love' in my mind) are melting away as the money becomes cheap and increasingly divergent from 'wealth'. Mike Southon, a writer and conference speaker who I have referred to before, puts it this way : 'money is what you have in your bank account, and wealth is what you got left'. This is one area where Late Victorian businessmen can teach us a few things: They made less money, but ended up with more wealthy, as evidenced in their legacy and my evocation of my grandfather in telling this story. Satisfaction, Independence and Legacy as a reward are abstract, but no more woolly than money as reward (see it this way, money is nothing but the trust you have on the world's bankers and if you didn't sleep through the last few years, the trust should now run quite low whatever the bank balance). I would argue that in this world of low institutional trust, the 'purpose' of business will again take the precedence and making money will become what it should be, a derivative.

And, finally, rightness: As much I can't be my own grandfather, the days of transient, completely relative moral are over. The costs of not doing the right thing is rising and increasingly, the accountants, who are the High Priests of our age chanting the mantra, are being forced to accept that the right is not quite right. So, again, a peripheral vision of rightness is emerging: A more complete and coherent vision. As a senior executive recently explained to me - doing the right thing is now at the top of the chart, implying that when one is expected to trade off between conflicting values, doing the right thing, the woolly, mid-Victorian concept should trump the modern, situational, maximization of profits.

So, in the end, there is hope. I should not give up on entrepreneurship yet: Just, like any day and age, be more judicious on who we get involved with.

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