According to the Wichita Business Journal there is a new book coming out titled Knightfall by the former editor of the Wichita Eagle, Davis "Buzz" Merritt. I haven't read the book, but the review says it, "documents Merritt's views of the decline of journalistic standards in the newspaper business." Not satisfied with newspapers, Buzz decides to start cookin' with gas and generalizes his insights into a grand unified theory of ethics in the business world at large (quoting from the review):
Merritt, who lives in WIchita and teaches a media ethics class at Wichita State University, says the issues at newspapers can also be seen in the business world.
"Whenever increasing mandatory profits becomes the operating guide for your company as opposed to a good product or service, then a lot of bad things happen in a lot of businesses," he says.
I sure hope this is either a mis-quote or it is taken so far out of context as to be unprofessional of the reviewer... Again, I have not read this book, but if the quote is accurate and not out of context, this is pure nonsense .
How does one go about determining if a product or service is "good" or "bad" in the absence of profit? What other guide is there for a company than making a profit? Profit is the sole objective measure of a company's ability to add real value to the community, assuming it is conducting its affairs lawfully and with integrity -- and assuming the community isn't being coerced to buy its products and services.
Mandating profits? Nice idea, not real practical. I suggest an experiment for Buzz: go run a lemonade stand and attempt to mandate profit and see how many glasses you sell. At some point I think it will become obvious that forces like demand, supply, innovation, and competition have much more influence on the price of a glass of lemonade than any "will to mandate" on the part of the owner of the lemonade stand.
Profits make it possible to stay in business, to grow the business, to employee people in the community, to pay taxes, to donate to charities, etc. A company's corporate social responsibility to is make a profit by creating real (as opposed to illusory) long term value for its customers by the economic (as opposed to political) means, lawfully and with integrity. That's it.
So, Buzz, here's the deal: if companies focus on the profitability of their products and services, they will, by definition, be providing good products and services to the community. By attempting to increase their profits in a principled manner, a lot of good things happen in a lot of businesses -- and we are all better off because of it.
