Reposted, because you never saw it.
Pretend you’re a business owner. What’s your job? Make money. How do you make money? Spending less than you bring in. The less you spend, the more you make. Duh.
What are your biggest expenditures? Your location, your supplies, and your people. If you go cheap on location, you could lose business. If you go cheap on supplies, you could lose quality, thus losing business. If you go cheap on people…?
We’ve been in a startling financial crisis for too many years, and we’ve found too many things to blame. The war. Wars. All three of them. Bush’s tax cuts for the rich. Obamacare, which didn’t come along until well after. Wall Street. Mortgage lenders. Bad investments. Goldman Sachs. They’re probably all guilty in some way, but there’s one area of blame I haven’t heard from anyone yet. The Bosses.
We have record unemployment. Why? People are being fired. Why? Because the Boss isn’t making enough money? Why not? Not enough people are spending money. Why not? Because we have record unemployment. Why? Sheesh.
Expenditures. A company’s most important expenditure is people. Why? Because we are real. We think, we do, we did, we will be, we can be, and we are.
One day, there was a company somewhere that had about twenty employees. One day, three were out. On that day, the boss saved 15% of what would have normally been paid to those twenty hourly workers, but there was no loss of 15% of production. The boss told the remaining 85% that today’s work must be done, and the rest of the workers were going to have to pitch in and pick up the slack. They did. At the end of the day, 100% was done for only 85% of the pay.
The Boss looked over the days plus/minus and realized it was a good day. He realized it was a day he wanted to have happen again. However, for that to happen again, he needed two things: 1. To fire three people, and 2. To motivate the other seventeen to continue to pitch in and pick up the slack. However, what if they didn’t? He could be in trouble.
He announced to the twenty employees that “times were tough” and he would have to let three people go. He wasn’t sure which three, but he warned them, apologetically, that it would happen. And then he watched. He watched those twenty bust their twenty asses to prove that they should not be one of the three, that they should be one of the seventeen. The twenty worked hard, hard as hell. They distanced themselves from each other. They did extra, asked for more, and smiled through it all. They said, “Yes, Sir,” and “No, Sir.” They spent less time at lunch and worked through breaks, all to be seventeen and not three.
When the Boss decided on who were three, he picked up the phone. He called three people, gave them the bad news from a distance, and told them they could collect their things on Saturday when the shop was closed and they wouldn’t have to face the others. The Boss knew it would be a little embarrassing, and he was so kind to spare them.
On Monday, the seventeen had a lot of work to do. The Boss had just gotten 120% of production from the twenty because the twenty were working extra hard to not be the three. Now, there were 85% of the people trying to do 120% of the work. The Boss expected that 120% was now going to be the new 100%, and he expected it to stay that way. And he announced that if it didn’t stay that way, he would find a different seventeen who could make it stay that way.
How were the seventeen able do the new 100%? Fear. Fear of being one of the three and not one of the seventeen.
This is where so many jobs have gone, but nobody wants to talk about that. Is it legal? Of course. Is it right? Depends if you’re one of the three, the seventeen, or the Boss.
brainsnorts inc. 
I recently had a discussion with a cousin of mine who kept insisting that we should “let the market provide solutions.” He told me he is confident that there will be market solutions for climate change too, but we should let business and enterprising individuals sort that out. After all, if people do it “on their own” that is free choice. If people are compelled to do it/ forced to do it then that is bad.
Of course, in this economy, what is the difference between freely choosing to look for another job because your job is downsizing or looking for another job because you’ve been fired?
Ugh.
Yup. The market cares about itself. Its bottom line. Not people.
*Nodding head*
On another (related) note: this is why I always love listening to Bruce Springsteen.
Me too.
Hi Jeremy, if I were not mistaken, I suppose that you were referring to his working class anthem(s).
Rich–thanks so much for sharing this. It is so relevant. Good comments from Jeremy, too!
You’re welcome.
You’ve hit on one of the flaws of capitalism, also called greed. The Bible says the love of money is the root of all evil, which I believe to be wrong, because I can think of lots of evil that has nothing to do with money, but money is probably in first place. There used to be a kinder attitude in this country, businesses weren’t so ruthless, but now it seems civility is history at most companies. I believe we’re in a new era of robber barons, and it’s the role of Congress to stop them, but as Will Rogers famously said, “We have the best Congress money can buy.”
Ron
Congress spends more time on re-election than anything else.
Yikes! The boss sounds like the one in Bain Capital 😉
Yup
Sad but true.
I can’t begin to tell you how many times I have had this conversation with my friends on the others side of the ideological aisle and how many times they have said to me….well, the ‘3’ obviously were just overhead.
Yeah, that makes sense. Talk to me when you are overhead. Some of them of course end up doing just that. The story is different then. It was unfair, someone else sabotaged them or they were somehow cheated.
Yeah okay.
Great job, very well done.
thanks miss.
What a fantastic post! When did you write this? At a guess it was in Victorian times – because it seems to me we are heading back that way. The boss in your post is gliding nicely along to behave like a mill owner in Victorian England – he’s not there yet but give him time – he’s learning quickly.
believe it or not, i didn’t see this comment until today. thanks very much.
Sounds like our school district’s plan.
Bravo! I have said this over and over…”human resources” rather than personnel….but we have lost the humanity in all of it. “The reward for doing a good job…is more work”. Private business/greed cannot regulate itself. So hard to teach my kids morals when we are surrounded by people who have the “I got mine” mentality. I feel we are doomed….the less is more approach should not apply to PEOPLE fer chrissakes! I hate what that kind of “competition” does to our spirits….
yes, there is doom ahead.
my poor babies 😦
Makes it understandable why some people choose not to have kids.
That’s exactly the situation that has been going on in my company’s IT department (where I work). We’re now in the process of outsourcing staff, oh, but don’t call it “outsourcing”!
that’s a bad word. they’ll come up with a new one soon.
We are currently calling the entire plan “elevate” which is hilariously nonsensical.
spin spin spin. like “clean coal.” no such thing, but it’s a name. you can call garbage “gold” and get away with it.
Great post and one of a myriad of reasons I no longer toil in the corporate world. Cheers to re-posts
and cheers to those brave enough to take that leap.
bravery is so very often confused with idiocy…I am hopeful I fall somewhere in the middle
there are many successful idiots.
indeed!
I agree with the general model Rich but I’m not convinced that small businesses really match that model. I have a friend who works in New York. The company he works for is small, maybe a little smaller than the 20 employee business in your model. When the GFC hit this company asked its employees to work shorter hours for less pay so no-one would have to lose a job and the company would not go bankrupt. They did and now the company is chugging along again with all of its original employees still on board.
The large corporations though? They’ve been shedding people left, right and centre because even the Bosses don’t care about the business itself. They only care about keeping shareholders happy.
Why does no-one ever ask shareholders to tighten their belts for the sake of the business? Because shareholders care about the business even less than the lowest paid employee.
Companies used to make products, now it seems they only make profits.
It was just an example with smaller numbers for an easier scale, but you’re probably right.
I sort of realised that about half way through but my resentment of big corporations kept me barreling along.
I left when they asked me to sell my soul in order to keep my job as Operations and Maintenance Manager (I was doing two jobs! Ha!). All I had to do was lay off five people until things got better. i told them to lay me off and one other piece of dead wood at the top and then the five guys with families could soldier on.
I am now poor in dollars but rich in spirit. Doing what I love and listening to my heart sing.
The answer to all of this is that it’s going to collapse sooner or later. My bet is on somewhere in between. Save food because the money will only be good as toilet paper. (The Fed says, “Don’t worry, we’ll print more!) Get to know your neighbors, start a garden, figure out a rudimentary solar power system for your home’s basic loads…The list goes on.
I’m fortunate to live in Hawaii where the weather is good and most of the idiots will move back to the mainland just in time for the worst of it. Hard to starve here, but you better be prepared to fish or cut bait.
Great post, Rich.
Aloha,
Doug
I’m there is much you know that the rest of us need to know. Thanks to you, sir.
I almost wanted to comment ‘I love you,’ but then I don’t really know you, so I’ll just say, well put, sir.
Thanks. And you’re allowed to love me.