A Matter of Supply

Nicholas Kristof's column in the New York Times today reports on the school in Sudan founded by Valentino Achak Deng (whose story was told by Dave Eggers in "What is the What" - I can't do that book justice bracketed by parentheses but I highly recommend it). Thanks to a best-seller that distributed Valentino's story across the world, the school is being generously supported by donors around the world. The school is starting its second year, and it is taking on an awesome task. Kristof reports that last year, only 11 girls in all of southern Sudan sat for high school graduation exams, and chillingly:

Based on official data, a girl there is far more likely to end up dying in childbirth than she is to gain a primary education.

The school can accommodate only 150 students in its incoming ninth grade class. Thousands have applied, many of them adults; the actual need is surely more than that. And yet, even to supply the educational needs of its relatively few students, the school is stretched not only because of its limited resources, but also due to the paucity of infrastructure. Lacking the power grid that we in the US take for granted, the school relies on generators and solar panels to power its computers. And then there is the question of books:

Recent donations have enabled the school to build a library, which is starved of books, but there is no local postal service for American friends to send books. Valentino looked into the possibility of having books mailed to Kenya and then trucked in, but found he would have to pay prohibitive import duties.

 John Sviokla recently wrote "If one looks throughout history, workers' productivity has always been proportional to the quality of the tools they use." This is an important aspect, but equally important to economic development is the quality of distribution or infrastructure access. A person without access to infrastructure is by definition living off the land. Without access to tools for preparing the soil, planting, irrigation, and harvesting, that person (and that person's family) must by definition live hand to mouth.

Education requires very sophisticated infrastructure, which if you have it, is simply invisible. Basic literacy can be taught one to one, with few tools: as Kristof points out, Valentino learned his letters by drawing them in the sand. That's a necessary foundation, but not what it takes to articulate within the world as we know it today, from Seattle to Sudan. That requires tapping into an immense network of information, and having the tools and access to do so.

This is necessary even for very modest education efforts. I'm currently collaborating on a problem solving course. Without a second thought, I availed myself of the following tools that any corporate worker in the US today expects is readily on hand: computer, high speed Internet connection, projector, training rooms, software to create presentations and manuals, reference materials (books, articles, videos), books for students purchased on-line and delivered within a week for the class, copying and binding services, on-demand electricity, subject matter experts and colleagues who can review and advise. Because of this wealth of infrastructure, tools and knowledge that I could access with little effort or delay, my co-workers and I are able to produce a series of training classes in very little time, just in the normal course of our work lives.

Humans have solved the problems of distribution in many parts of the world; the technical answers are not elusive. Investment is not necessarily the constraint - there are a lot of investors who see the value of the untapped potential of communities around the world. The bigger problems to solve are -- as always in the human condition -- politics and exclusion. These too can be changed: even modest prosperity can empower transformative change. Distribution can promote prosperity.

A Beef with Unregulated Business

As I mentioned in my last post, I'm reading Fast Food Nation (Eric Schlosser). Last night I finished the chapter that effectively updates Upton Sinclair's The Jungle to document the meatpacking workplace in the late twentieth century. This chapter ends with the story of Kenny Dobbins, a man of incredible strength and company loyalty who worked in Monfort meat processing plants for almost 16 years. After surviving many horrific injuries on the job, saving another employee from being crushed by a pulverizing machine, and supporting the company in its stand against unionization, he was fired without notification and without a pension.

"They used me to the point where I had no body parts left to give," Kenny said, struggling to maintain his composure. "Then they just tossed me into the trash can." Once strong and powerfully built, he now walks with difficulty, tires easily, and feels useless, as though his life were over. He is forty-five years old." (Fast Food Nation, 2001, p. 190)

Monfort may not have broken any laws in their employment practices; their industry has influenced the dilution of workplace safety regulation over the past twenty years. 

This weekend, the front page headlines are dominated by the SEC civil suit charging Goldman Sachs of fraud. Were Goldman Sachs's actions in fact legal as they claim, it would be a condemnation of the shabby state of our regulatory system rather than a defense of their integrity. Predatory business practices across industries integral to our economy (food, health, finance, real estate) cause  incalculable real, ongoing harm to employees, customers, other businesses and the overall economy -- affecting not just our nation's stability but that of the broader global community as well. The far-reaching impact of these practices should not, however, imply a far-reaching use of these practices.

In my experience, businesses large and small are run with an emphasis on ethics, making decisions based not on what they can get away with, but rather on what is the right thing to do. They require their employees to use safety equipment and procedures not just because the business doesn't want to be caught by OSHA, or in fear of a large worker's comp claim, but because they don't want their employees to suffer the pain and loss of an injury. Having a strong agency overseeing workplace safety is, however, important to not only the nation's workers but also to the nation's businesses. OSHA and insurance companies provide the valuable service of educating businesses about potential workplace safety risks and how to avoid them. The regulatory system also functions to level the playing field: if company A incurs expenses in training and equipment to protect their workers (because it's the right thing to do), but their competitor company B does not, company A and the market as a whole have to bear the costs resulting from B's irresponsible behaviors. A regulatory system, therefore, is not an enemy of business: it functions to reduce and eliminate negative outcomes and therefore supports a vibrant and competitive marketplace.

And yet, it seems that many ethically-run, good companies sometimes fail to recognize that their interests and values are not aligned with those businesses with predatory practices that seek to influence the market, business journals, and policy makers. I am sometimes perplexed these days by the term 'pro-business,' when it is used in the context of protecting corporations that have abused the public trust. We hear a lot of talk of free markets from many who have demonstrated a willingness to act without regard to basic ethical constraints that the rest of us find binding even in the absence of a regulatory scheme. Markets without ethical boundaries become dominated by a few reckless, unethical actors. Totally unregulated markets are anything but free and competitive.

Most business people I've had the good fortune to work with want to make a positive impact on the world they inhabit. They enjoy fair competition, and like to win. But they want to win knowing that the game wasn't rigged, and that success is a function of their company's efforts, creativity, and hard work. They like to give back to the community. They take pride in and feel humbled by the success stories of their employees. I suspect that this description of business owners and managers is a portrait of legions, and depicts the majority of people who run companies not only here but around the world. Those legions must oppose the practices and influence of businesses who use the profit imperative to rationalize any unethical action.

It is vital that we understand the divisive intent behind the use of the term 'pro-business' when it is used to imply government meddling in business affairs. The real antagonism is not government against business, but between businesses whose predatory tactics destroy value and those businesses that create value.  We must acknowledge that some who have been touted as business leaders are not representative of the business community when their profits are the result of taking advantage of lax regulation rather than creating advantage through ethical and humane business practices. We, as business people, must call these others out when they seek to tilt the game in their own favor by instilling fear and outrage over what they characterize as regulatory burdens. And we must point out at every opportunity that predatory business practices create even more burdens for other businesses, communities, and markets at large.

If you run your business responsibly, and trust that other businesses do the same, you must take a stand against those businesses that abuse that trust.

Of Good and Evil

Umair Haque argues in a blog post today "The Case for Being Disruptively Good." Haque poses the question: how is it in the self-interest of a business to act in ways that are socially responsible? It's an interesting argument, although I think his reference to Wall Street in support of his theory actually dismantles it. But it is intriguing to contemplate whether hyper-connectivity and its resulting transparency challenge the ethical models of corporations. I'm not so optimistic. Haque notes: "Yesterday, the global economy was built on debtors' prisons, usury, expropriation, colonialism, and slavery. Today, it isn't. " I'm reading Eric Schlosser's Fast Food Nation right now. I can't see the case for progress quite so clearly.

I think most people, whether they work in entry-level jobs or the corner executive suite, want their work to mean something. A person fully employed spends more waking time at work than doing those things that bring emotional  enrichment to their lives. We really don't want just a paycheck in return for our individual production. We want to make a contribution, and to make a positive difference in the lives of customers and co-workers.

And yet, people at all levels of any company routinely make decisions that harm customers and co-workers.  I don't think most people are evil. I think we can all be unmindful of the power we have in our relationships to harm others, and are too uninterested to understand the context before making a decision. When Wal-Mart's HR policies are criticized in the press for being socially irresponsible, I tend to think that the people who set those policies weren't so much evil as disconnected from the employees who were affected negatively by the policies and perhaps too connected (exclusively) to the people in the boardroom. When a customer relates an incident where she felt wronged by an employee's comments or behaviors, I likewise tend to see the failing as a result of disconnect rather than personal morality. But the employees harmed by their employer or the customer harmed by an employee could both, rightfully, judge those actions evil.
 

Whether intentional or not, the actions were wrongful because of the power the decision-maker held over the other party. In a traditional corporation and in a typical retail environment, the corporation has the power in the relationship. If the power an executive held derived from his or her employees, not shareholders or other executives, the executive would be much more mindful of the context within which boardroom decisions affecting employees are made. If the retail store understands its power derives from its customers, not from the corporation that owns it, behaviors would be different.

It's true that people act differently when their actions are transparent. However, it matters who is observing. Fellow motorists will happily exceed speed limits well beyond acceptable tolerances, until a car with the authority to ticket them appears. Wall Street will continue practices that are self-serving, even if they are clearly not sustainable, until a body with the authority to hold them accountable makes it matter to them. I can't imagine how the financial products companies (I can't in good conscience call them banks anymore) who wrecked the economy  would have learned anything from the last couple of years other than: "We have the power." What else could they have learned from the consequences of their actions?

But you don't have to be too big to fail to consider the impact you have -- for the good, or for evil -- on the relationships around you. That is the hyper-connectedness that I think is at the heart of substantive change for the good. First you must be aware, and then seek to understand your responsibility to that relationship.

I'm also reading now The Lemon Tree (Sandy Tolan). It narrates the history of the relationships between Israel and Palestine, on both state and human levels. It is a story of how truly evil people can be to each other (reminiscent of Caligula's line in I, Claudius, which John Hurt so deliciously rendered: "Aren't people awful?" was his comment in response to a litany of particularly sadistic and horrifying acts). But the people in Tolan's book aren't awful at all, in fact they have marvelous and sometimes heroic qualities... within the context of the relationships that matter to them.

We cannot be connected more than superficially to more than a small number of people, those that really matter. Beyond a couple degrees of separation, the relationship has a diminishing power to influence us. But in the workplace, our co-workers, employees and customers should be only one degree away, and they matter.