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Peter Namtvedt wrote:
>
> P.S. I don't thing we need to. We all take chances. The difference
> between the honest but shrewd business deal and stealing is often
> the elusive factor of the one party knowing something big or not
> about his/her advantage in a deal and not disclosing it. How many
> of us disclose to the other party in our trades how we assess the
> outcome or our reasons why we think they are wrong and will lose?
> petena9090@xxxxxxxxxxxxxx
Hi Pete,
You have stated this argument several times. I didn't respond further
because the list had been chewing on the subject for some time.
However, It *has* been a while, and it *is* Friday.... so I would
like to offer a rebuttal. <g>
To compare business to trading in this context is fallacious.
Trading:
The primary goal of trading, to put it bluntly, is to take the
other fellow's money. However, BOTH realize that they are playing
a zero sum game. BOTH realize the risks and the rules involved, and
BOTH accept that risk, each believing his view of the market to be
superior. If we do harm to the other person by taking his money
so be it. He understood the risks when he took the trade. The
winner has done no wrong. This is "good trading"
Business:
Let us address the modern concept of what is considered "good business":
The goal of a good businessman is to be a *provider of value*. By this
we mean that he provides for the needs of his clients, employees,
partners, and those who sell him what he needs to produce his product.
It is a synergistic "win/win" situation for all concerned. He stays
up nights thinking about how he can add value to the lives of those
that are connected with him. For this effort, he receives money.
Lest I now be accused of "Lutheran ranting", let me point out
coldly and logically why this approach is correct, why it works, and
why the business world came to embrace its use:
How does our businessman fair?
He is often well-liked and respected by his clients. His partners like
him, and the fellows he orders goods from make sure to get his orders
out first, and they always make sure to remind him if he has forgotten
a discount he can apply. All understand that he tries his best for them.
Since all are happy, no one complains and the government and the state
have no reason to give him grief. In every respect, his business is very
likely to succeed.
Let us now consider the old "dog eat dog" business paradigm. *This*
businessman has *one* goal: MAKE MONEY. He screws his suppliers out
of every nickel. He believes business is WAR. He provides product of
little value and asks high prices. He counts on "hype" to get the
selling done. He fulfills no real needs, and he produces no lasting
value.
How does our businessman fair?
His (ex)clients hate his guts when they figure out they have been ripped
off. His partners watch their backs. His suppliers send out his orders
last, and they make sure to charge him full price. Everyone is
complaining so loudly, the government and state are on him like
white on rice. His chances of success are not good.
This approach gives power in the beginning, but destroys in the end.
A perfect example of this is what has happened to Japan, as well as
our old friend Jake B. .Much of the legislation that has shackled
honest enterprise has been a direct result of such.
Granted there are a few, like Microsoft, that can get away with it, but
only by virtue of their OS. Still, they are carrying a lot of law suits,
and everyone is trying to find a way to eliminate them. Some guy in
France smacked Bill Gates in the face with a cream pie, when he was
there on a business deal. Money is power, but the Gates mansion must
seem cold and empty at night.
Why has business changed its view? Because they understand that
creating value and fulfilling needs also creates value for them. It
insures their survival to a much greater degree, and for the long haul.
This is "good business"
SUMMATION:
Good trading and good business can not be considered analogous
at all. Trading is a game of speculation between two participants who
understand and agree to the rules of the game. The goal of business
is to provide value.
References:
Competing on the Edge: Strategy as Structured Chaos by Brown and
Eisenhardt
Sense and Respond: Capturing Value in the Networking Era by
Nolan and Bradley (Harvard Business School Press)
Ben and Jerry's Double dip: Lead with Your Values by Ben and Jerry
Regards,
Walt
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