Friday, April 24, 2015
Greedy Big Businesses!
I’m not always right. Of course I don’t put out incorrect information on purpose, but occasionally a reader takes me to task about a certain position or conclusion and I have to do some harder thinking on the subject.
In one case I was accused of putting too much emphasis on self-protection for the consumer, doing more research and not being lured in by tempting or manipulative offers and not being hard enough on the “greedy” business people who are out to separate us from our hard-earned cash. Here is how I responded.
I see it as a matter of priorities and incentives. The businessperson is motivated to make a profit and over the long term to build the customer base. For the most part this means selling a good product at a reasonable price and maintaining a reputation of doing so. I think most in business get this. The downside is that they often let the short term interfere with the long term which leads to the bad decisions, pushing their drugs and using clever advertising to sell what they may believe is a good product in order to stay ahead of the competition. We have some charlatans out there who don't care about return customers and would be deaf to any pleas, but the regular businesses understand. They go wrong when they ignore the customer and react to pressure from Wall Street and other parties, in which case they would also be deaf to any pleas.
That’s why I concentrate on the citizens and consumers. The consumer should have the priorities and incentives to spend money wisely and not be taken in by the smooth talk and psychological tricks. This is where the pressure can be applied and where there is the motivation to listen to advice on how to be a smarter shopper.
If we get the businessperson to act more responsibly, it might hold for the short term until competitive pressure and the primary motive takes over. So the only way to get him to respond over the long run is to make it unprofitable to act irresponsibly because most consumers are clued in to the tricks and require a good product at a reasonable price and are willing to tip off friends and even to mock the presentations that are manipulative - remember reputation and brand are sacred!
In sum, I think the incentives drive the way we approach this. We can wish all we want for responsibility in business or we can focus on the consumer and force the outcome we expect. Was it Sartre who said, "Every generation get the war they deserve" or words to that effect? Well, I think we get the ads, the news, the business practices, the level of entertainment and the government we deserve based on current behaviors and the only way to change that is to change our behavior.