Tuesday, October 23, 2012

Management and the Liberal Arts

Part I John Milton

The Bible says that “there’s nothing new under the sun” and that is very true. Any student of history can discover universal lessons in leadership, management, business strategies, and corporate politics. Indeed Nicolo Machiavelli’s book “The Prince” is nothing short of a management handbook for the discerning reader. Actually in practice the modern corporation is really no different than any ancient kingdom. It has its kings, princes, barons, and yeomen. It is filled with courtiers, dissidents, loyalists, allies, and enemies. What is important to the modern manager is to be able to use the histories of these kingdoms as examples of how to deal with the challenges both internally as well as from competition. Admittedly sometimes it requires some thought and analysis to see these examples and a good example is found in Paradise Lost as Satan and his lieutenants discuss their recent fall from grace. With a little imagination you can see the lieutenants Moloch, Belial, Mammon, and Beelzebub as corporate board members discussing with the CEO how to recover their competitive position.

The language – even in the seventeenth century – is high poetry but the arguments and the personalities can be found in virtually every corporate board room today. The first speaker is Satan who offers some motivational remarks before they get down to the business of deciding what to do. It is Moloch who speaks first:

My sentence is for open war:of wiles
More unexpert , I boast not, let us rather choose,
Armed with Hell’s flames and fury, all at once
O’er heavens high towers to force resistless way
Turning our tortures into horrid arms
Against the torturer
Which if not victory, is yet revenge

This is a classic response from a classic personality. This is the response from the “shoot first aim later” manager. He does not recommend analyzing what went wrong and what must be done to correct it. Instead he is the manager whose response is to raise more capital, retool the factories, increase the advertising, retrain the sales team, and attack the market one more time with more energy. Every organization has its Moloch, he’s the one who gets the job done and overcomes all obstacles – as long as he is told what he is expected to do. He is enthusiastic, emotional, and substitutes action for thought and analysis. This attitude is reflected in his last line where even if he fails, he at least will get some emotional satisfaction in revenge. The next person to speak is Belial, the pragmatist. Every organization has its Belial, he is the intelligent one, the realist, the one who acknowledges the defeat and offers another alternative:

First, what revenge? The towers of Heaven are filled
With armed watch that renders all access
Impregnable, this is now
Our doom, which if we can sustain and bear
Our supreme foe in time may remit his anger

Of course this is really not a plan at all, but a recommendation to simply accept defeat. This is your classic risk adverse executive. The company has suffered a major defeat at the hands of a competitor and rather fighting back as the risk taker Moloch advises, Belial wants the opposite. He wants to protect what remains rather than fighting back and possibly losing even more. Risk adverse executives are not effective in highly competitive environments. The next to speak is Mammon, who at least seems to have thought about the situation and offers a valid option:

with what eyes could we
Stand in his presence humble, and receive
Strict laws imposed, to celebrate his throne
With warbled hymns, and to his God head sing
Forced hallelujahs, while he lordly sits
Our envied soverign?
To found this nether empire, which might rise,
By policy, and long process of time,
In emulation opposite to Heaven

This desert soil wants not her hidden luster, gems and gold
Nor want we skill or art, from whence to raise
Magnificence: and what can Heaven show more
To found this nether empire which might rise
By policy, and long process of time
In emulation opposite to Heaven

So Mammon rejects the frontal assault recommended by Moloch, the risk adverse acceptance offered by Belial and offers a realistic appraisal and solution. He recognizes the defeat but believes they can be great again and need to regroup. His option is to revamp, restructure, offer new products so they would emerge as a new and stronger enterprise equal to the competition. Although Mammon captured the feeling of the meeting and offered a strategy, it remained for Beelzebub to offer an alternate approach altogether.

There is a place
If ancient and prophetic fame in Heaven err not
Another world, the happy seat of some new race called man
Thither let us bend all our thoughts, to learn
What creatures there inhabit, of what mould
Our substance, how endured, and what their power
And where their weakness, how attempted best
By force or subtlety

In effect Beelzebub suggests a market survey with the idea of opening another market where they would be stronger. This type of manager is one capable of recognizing the setback, analyzing the situation and formulating a new strategy. And it is this approach that is accepted by Satan.

Admittedly Milton’s prose is compressed and requires some reflection and thought to apply it to modern management, but the lesson is there. What Milton describes are the four possible approaches to a severe shift in the market and competitive position of a company. These are the classic alternatives faced by managers today. Now we turn to management as seen through Shakespeare where the lessons are more visible.

Wednesday, October 17, 2012

Foreign Policies of President Obama

Recently I was asked to comment on President Obama’s foreign policy. By no means am I a foreign policy expert and what I know – if anything—is based entirely on what I have read and seen on TV. However, based upon that limited foundation, I think President Obama’s foreign policy rests on two key factors. I believe he is first and foremost an “Internationalist” in the sense that he believes in World Government. This translates into a tendency to subordinate America’s interests to those of the UN and the international community as a whole. The second factor is his belief that America is an overbearing arrogant super power that acts unilaterally and without regard for the interests of other nations.

President Obama came to the Presidency with no experience in business, government, or the military but with an activist vision of all of these things. He promised to end the wars in Afghanistan and Iraq, to close the Guantanamo Prison, to repair America’s relationship with the Islamic World, to reach out to Iran on their Nuclear ambitions, to reset relations with Russia toward ridding the world of nuclear weapons, to work with the Chinese on global issues, and to make peace in the middle east. In retrospect it is easy to see the naïveté of these goals because of their idealism and failure to account for any of the underlying details. President Obama’s lack of experience left him unprepared for the reality of his position and the constraints on his power. Each of his objectives individually are worthwhile but he did not realize that none of these stood alone but had strings and impacts in Congress and with other countries.

From the outset he found that there were constraints on his power, constraints from congress, from the people, and even from other countries. It seemed to him closing Guantanamo and moving the prisoners to prisons and to civilian trial would only require his order. He was unprepared for the cost, the public outcry, and the legal issues. Ultimately he was forced to abandon this goal and act pragmatically. In fact President Obama’s efforts to achieve the lofty goals he promised have consistently yielded to practical decisions and compromises.

Having been raised as a Muslim or simply exposed to Islam, he came to office perhaps with a greater understanding of Islam than any previous president. Armed with this knowledge he aimed to repair America’s reputation within the Islamic community. This objective formed the basis for much of his foreign policy. This was a policy that not only failed in its objective but seriously damaged his position at home. His actions and compromises have been viewed abroad as signs of weakness and intransigence and at home as examples of his inexperience, incompetence, and subordination of American interests to internationalism.

One of President Obama’s objectives was to end the wars in Iraq and Afghanistan but he quickly discovered that starting a war is much easier than ending one. But there was never a declaration of war so as President he could end them with a stroke of a pen, which he more or less did. This was done over the objections of the military and the result left Iraq dominated by religious conflict, an incipient civil war, a corrupt government heavily influenced by Iran, and with Al Qaeda resurgent. The results in Afghanistan are similar. By announcing a withdrawal date the Taliban and Al Qaeda took that as surrender and have become resurgent. In this instance he fulfilled his campaign promise but his foreign policy failed and the Islamic community saw this as an example of American unreliability and weakness.

As part of his policy of Islamic refurbishment President Obama distanced himself from Israel. To a rational person that might have made sense but the Islamic countries simply saw that as another sign of weakness and a demonstration of how unreliable America is as an ally. Rather than improving the situation in the Middle East President Obama’s policies have left the Muslim Brotherhood and Al Qaeda stronger throughout the area. More importantly the policy toward Israel has emboldened Iran and the Palestinians and has made the possibility of another war greatly increased.

The Foreign policy toward China has been one of talk more than action. The Chinese government has consistently attacked our government and industrial computers for the purpose of stealing secrets. The Chinese do not honor copyright laws and manipulate their currency. All of these things are known and reported in the press, yet there has been no action taken to correct or prevent these. This has had a huge impact on the American economy through the loss of jobs and revenues. The idea that problems can be solved through talk is the basis of diplomacy but ultimately diplomacy must be backed up by action and these actions have been missing throughout this administration.

The foreign policies of President Obama have been well intended with the idea that by retreating from an aggressive leadership position America’s image would be enhanced, but clearly this has not been the result.

Sunday, October 07, 2012

AHHH The French

The French just can’t seem to accept that they must actually work for a living and compete in the marketplace just like everyone else. Even more ironic is that Germany started its failed march to European dominance with the Franco-Prussian War and two world wars, but is now poised to achieve that goal without a shot being fired. The Germans live the good life (for European standards) by working hard and living within their means. Alas the French live the good life but seem to expect that the government should pay for it. The people think a 40 hour work week is exploitation and a 32 hour work week is as much as any employer should expect. Of course the problem with socialism is that eventually it cannot be sustained. The proof of this is being played out across Europe as the economies of Spain, Portugal, Ireland, and Italy teeter on edge of financial collapse. The economy of Greece has already imploded and threatens the Euro itself.

Now the French who view themselves as the dominant force in Europe are finding that not only are they not the dominant country, but that it is Germany calling the tune. Faced with the prospect of actually having to give up some of their benefits and actually work a 34 hour work week, they threw out President Sarkozy and elected inexperienced Hollande. Unfortunately Hollande had no real experience, had no real plan, never took Economics 101, but was sure his Gallic Charm would enable him to win over Germany, the tax payers in both Germany and France, without actually having to make any financial sacrifices. Alas his socialist economics seems to have failed him. The reality is that money will gravitate to the highest return and flee extortionate taxes.

Hollande felt that what was needed was higher taxes and that the rich should pay their fair share, a typical socialist position. In his view the fair share of the rich was 75% of their income, after all the rich should be forced to share their wealth with the workers. Not unexpectedly the rich simply moved their wealth out of the country. Renault moved 70% of their manufacturing to low wage Trukey and ArcelorMitta the French steel manufacturer shut down two furnaces in preparation of shutting the plants. The government’s response to this is to introduce a law forcing manufacturers to sell their idle facilities at a price established by the courts. Apparently the socialists seem to think that any sharp entrepreneur would jump at the chance to buy these facilities just to keep the workers employed.

Hollande was elected on the basis that he would preserve “the social model” while engineering an economic recovery. Neither Hollande nor the socialist electorate realized these are conflicting goals, especially in light of the high level of protection the French worker has. Nevertheless French unemployment is at a 13 year high with more layoffs coming. It is very difficult for an employer in France to layoff employees and it is very expensive due to the required severance costs. Consequently, when employers actually layoff people they are very reluctant to rehire and the tendency is to move those jobs overseas where it is cheaper and the rules more flexible. This means that reducing high unemployment is very difficult and takes a long time.

The Euro is in real danger and unless Hollande can get control of the French economy it may be unsustainable unless the Germans are willing to step up and bail him out. However, the Germans are tired of subsidizing the life of the rich and famous enjoyed by so many countries in Europe. Plus the Germans are also feeling the impact of the slowing world economy and may not be able to continue supporting these failing Club Med European economies. The stark reality is that socialism cannot work unless there are enough tax revenues to sustain the government programs. In a slowing economy the government must react in a business like fashion and reduce expenses which means cutting programs. When the people are accustomed to lavish government handouts this becomes almost impossible so it is now up to Hollande to show us how this is done.

Monday, October 01, 2012

White Cavemen

The Theory of Evolution continues to be taught and accepted as factual even though this theory has never met the strict rules of science. The fact is that all of the evidence offered in support of evolution is evidence of adaptation to the environment and not of speciation. How one animal morphs into another entirely different species has never been demonstrated but the glib answer has always been – mutation. That may be but it is not supported by transitional fossils. What have been described as transitional fossils could just as easily be examples of adaptation, so how species emerge remains speculation and is not supported by the fossil record or demonstration. And this brings us to human evolution, where we came from, how we got to be different colors, and why some people are blonde.

The Leaky family has turned human evolution into a family business claiming that humans evolved from a group of hominids in Africa. This claim rests on a series of bone fragments about three million years old and a few primitive tools. Recent discoveries of mostly bone fragments show that hominids are also found in Asia but what relevance this has to human evolution remains a little vague although scientists are convinced that these hominids are really the root species of Homo sapiens. That is the current belief is that these hominids adapted to their environment and through these adaptations they became human. That may be true but somewhere along the line the root species of apes became hominids – a separate species. Precisely how this happened is believed to be through mutation, but when you actually examine the whole series of proto-humans there seems to have been a lot of mutation going on without any real evidence.

In fact a large part of the belief that humans are descendents of these apes and hominids partially rests on the fact that the DNA of chimpanzees and homo-sapiens is almost identical with the chimpanzee’s being 98% human. Of course this proves nothing at all because that is tantamount to saying that Helium (a gas) and Lithium (a metal) are essentially the same because there is only one electron difference. Or to put this into another perspective the entire universal is composed of identical electrons, protons, and neutrons but how these are combined makes things unique and very different. So the DNA argument means nothing and now back to the hominids and why are cavemen white instead of black.

There is no evidence of primitive man in Africa just the hominids and the early humans are found in Europe. These early humans – the Neanderthals are believed to be white skinned. There is no evidence of primitive man in the Americas but there is some evidence in Europe and Asia, but no hominids. The hominids seem to be only in Africa but there is really no evidence of primitive man in Africa – just those hominids, which consist of bone fragments. But if those hominids evolved into humans – even primitive humans – then it seems logical that there would be some evidence of that. Some primitive art, skeletons, weapons, etc, but there is nothing in Africa other than what is believed to be primitive stone tools. However, primitive tools prove nothing by themselves since even some birds and other animals use tools, including Chimpanzees.

For the sake of argument let’s assume that Leaky is correct and that those hominids are in fact the human root species that separated from apes. Well apes are black with straight hair while modern Negroes are black with wooly hair. But all cavemen – that is primitive men in Europe are seen as white with blonde or brown straight hair. So the argument seems to be that the early apes separated into apes and hominids in Africa. Those hominids evolved into primitive humans and migrated to Europe, without leaving any evidence of their evolution in Africa but arriving in Europe as primitive humans with no evidence of their hominid beginnings. On arrival in Europe the black skin and straight black hair they started with became white skin and blonde or light brown hair in Europe. According to the rules of evolution these changes were driven by the European environment.

Black retains heat much better than white so why did the black skin of the hominids change to white in a colder climate? Currently the answer to this question is sexual selection both for skin and hair color. That is those early pre-humans with the lighter skin and hair were more sexually attractive leading to white cavemen with blonde hair. Assuming this is correct then where did the black and brown skins come from? We must believe that these early humans migrated back to Africa with white skin and evolved black skin because the darker people were more sexually attractive in Africa or that their evolutionary changes were environmentally driven. So we must believe that whites evolved through sexual selection while blacks evolved through environmental adaptation. This whole evolutionary structure begins to test the boundaries of credibility.

What about those brown skinned people that inhabit the Americas? All of these people we are told migrated to the Americas as homo-sapiens from Asia or somewhere undetermined. All of these early Americans have straight black hair with brown skin, not black or white. So is their brown skin the result of adaptation to environment, sexual selection, or mutation? What about the Amerindians? These people are seen as the Red Race and are not related to the brown race that surrounds them. What is their origin? There is no evidence they evolved where they are found but that they came from somewhere else, but where since they are not found anywhere outside of North America. Furthermore all of the races (out side of the Australian Aborigines) have black hair while only the white race has blonde, red, and brown hair. If these are mutations then why are these found only in whites? Are the other races immune to mutations?

So we must believe that humans evolved from apes with black skin, they migrated to Europe and evolved into white skinned people, who migrated to the Americas where they became brown skinned. The black skinned people either remained in Africa without leaving any evidence of their early evolution or migrated back to Africa from Europe and evolved back into black skin with wooly rather than straight black hair. The origin of the Australian aborigines and the American Indians remains a mystery unless they are examples of mutation. So the origin on Homo Sapiens remains unknown but speculative. Why Cavemen are white is based on sexual selection while blacks are the result of reverse adaptation. None of this is very convincing.