Corp Unc & Philos

About "Smile or die" : the unconscious of mature capitalism

The German translation  of "Smile or Die" by Barbara Ehrenreich has recently been released. The German business magazine Wirtschaftswoche publishes some comments by the author.

The Americans are a "positive" people. Yet, according to the worlwide surveys trying to measure the "gross national happiness", the United States are ranked 150th, suggesting a significant frustration of its people.

Barbara Ehrenreich's's explanation is that the so-called "positive thinking" is less a feature of the American mentality than an ideology. She further explains that by and by the American culture has been infused with the belief that thoughts have a "mysterious" impact on the material world, as if "negative thinking " could only lead to "negative results" and the reverse.

According to her, the financial markets were not immune to the drawbacks of "positive thinking". The increasing amount of private debts were to be compensated by the global prosperity of the economy.

She points out that "positive thinking" has become a moral attitude, an expression of the good, ruling out any alternative. Precisely, the belief that the only alternative is "negative thinking" is a serious hindrance to change, whereas both attitudes are pathological : they lead to a false judgement on reality, based on the confusion between feelings and perception.

Although I have not read the book yet, I think it addresses the right issue concerning the future of the United States. "Positive thinking" is a powerful emotional screen that is meant to hide the fears roaming in the American unconscious. It bars the possibility of a sound judgement on reality. 

This national inclination has since long been identified. Barbara Ehrenreich's reminds us of Martin Heidegger's position. The German philosopher declared in 1966 that the Americans are bound by their "pragmatic philosophy" which, in spite (and perhaps because) of its capacity to help driving forward technical operations, excludes any kind of relevant thinking on our modern world.  

The Wirtschaftswoche article is commented by a reader who believes that a "re-Europeization" of the American culture would help in the stabilization of the country. I see there another interesting hint towards Heidegger's thinking. He said in the same 1966 interview that in order to overcome the difficulty to produce a suited set of ideas to live in our present technological world, the "European tradition" will be essential. As he puts it "ideas can be transformed only by those ideas that share the same origin and destination".

The cultural foundations of capitalism is not a new idea. I remember the debate in the mid 90's about the problematic fit between capitalism and Confucianism in China. It is no more a question ; but its Western cultural unconsciousness might now become one.

An interesting website

Recently, I was offered the opportunity to contribute to the Newsletter of the site The Official Board , which was founded by Thomas Lot, a former Chief Executive at Apple Europe and Amazon. I took the chance to give a few thoughts about why so many mergers tend to destroy value.

It was a pleasure to contribute to this simple but clever Web 2.0 application. Its purpose is to keep an updated information on the 20 000 largest corporations in the world, as far as their charts are concerned. It is a very ambitious project with a high potential.    

Corporations are the speech of the people

Henry James once declared that

"the novelist succeeds to the sacred office of the historian".

John Dos Passos implemented the idea, as suggested by Alfred Kazin in his introduction to "The big money". Putting together the life of Henry Ford, F.W Taylor, T.Veblen and the fiction of Charley Anderson, Mary French and Margo Dowling, is quite meaningful indeed.

What is fiction, what is reality ?

A question which concerns above all the large corporations. Their declared values and history that  can be read on corporate brochures are more often fictious than real. The english language has a very accurate expression for that : wishful thinking.

The saying : "Reality outpasses fiction" deserves to be taken seriously. The problem is to know where reality can be caught. The answer is given to us by John Dos Passos : wondering what USA is, really, he says :

"USA is the speech of the people".

What people say is the best access to corporate truth. It is only a matter of interpretation.

Mary Douglas, institutions and management

Mary Douglas, the british anthropologist, passed away last may. Her researches have greatly contributed to a better understanding of how institutions work.

In 1986, she wrote in her book : "How institutions think"

"Institutions fulfill the same tasks as theories." *

According to her, institutions, including business corporations of course, are made of the same representations as those that are produced by individuals. This observation helped her develop a deep understanding of institutional dynamics. As she said :

"Individuals tend to leave important decisions to their institutions and deal only with tactical matters and details." *

In other words, individual behavior is mostly instrumentalised by institutions. This approach naturally reminds us of what the french philosopher Gaston Bachelard said :

"Scientific instruments are materialised theories." *

The common point between institutions and scientific instruments is their capacity to materialise mental representations and give them an opportunity to become active, in the social world and in the physical one, respectively.

The german sociologist Max Weber had an intuition of this phenomenon, when he wrote in 1913* :

"Not a single average consumer has the least idea about the production techniques involved in the goods he uses everyday. The same can be said about social institutions." *

This reality is still too often ignored in contemporary management practices. As they act, leaders tend to forget how their decisions are highjacked by the institutional processes that keep repeating themselves. They prefer to believe that the gap between their intentions and the results stem from imperfect collective execution.  This is how the concept of Human resources is meant to conceal  what actually is the corporate unconscious .

* My translation from french

How business models collapse : the case of music

Nearly a year ago, Pascal Nègre, the CEO of Universal Music France, declared: "The public has never listened to music so much as today while paying so little for it."

To solve the problem : "We are currently looking for alternative sales models that are more adapted to the latest technological innovations."

In other words, a business model is dying. Technology is being blamed. Suddenly, it has taken the professionals by surprise. The debate on what is called illegal downloading always concerns payments and sales, never the music itself. New business models are explored when it comes to the sales transaction while the evolution of the product over the past years is totally ignored.

Since the radio developped on a large scale, nearly a century ago, music has actually been free. We are so used to it that no one cares to mention the fact anymore. What the consumer pays for when buying a record is not the music itself but the capacity to control its consumption by reproducing it at any time.

Constantly on the air, music can also be heard in elevators, lounges or shops, and it is most often related to advertising. It has become a background noise which is part of the scenery of the merchant environment. Through a low but steady process the function of music has become less and less esthetical and more and more pragmatical.

"The shift of affects towards the use value creates a situation where nothing is expected from music anymore. " This was written by Theodore Adorno in 1937 !  Anticipating the future, he added : "The listeners behave like children. They repeatedly request the same recipe that has already been served to them." This is an accurate description of the present situation.

By selling music to the broadcasting companies, the producers  have contributed to turn it into a free product, at least for the consumers who in the meantime have become addicted to it.

The development of digital music, therefore, is not the real cause for the downfall of the classical business model.  It is only a strong revealing factor of a situation that has developped throughout the 20th century.

This example is an opportunity to point out that a business model is not a pure transaction device. It always develops around a supply to the public which is unconscious and likely to change as society evolves.  The purpose of strategic innovation is to anticipate this kind of evolution before  things change suddenly out of control.