Everything You Know About Growing Your Business Is Wrong
Edward Hess teaches business administration at the University of Virginia's Darden School of Business. Before joining the UVA faculty, he spent more than 30 years in the business world, beginning his career at Atlantic Richfield Corporation. He was also a senior executive at Warburg Paribas Becker, Boettcher & Company, the Robert M. Bass Group and Arthur Andersen. He is the author of nine books, over 40 practitioner articles, and over 48 Darden cases dealing with growth systems, managing growth and growth strategies. His most recent book "Smart Growth" was named a Top 25 business book for business owners in 2010 by Inc. Magazine and was awarded the Wachovia Award for Research Excellence.
Edward Hess: Our view of growth, what I call the US growth mental model has really grown up over the last 50 years in this country coming after World War II and a period of great productivity, great growth, rising living standards, and the United States becoming really the dominant economy in the world. All of that plus our cultural history of entrepreneurialism, individualism has fueled a group of beliefs about growth in our society.
Those beliefs are all growth is good, bigger is always better, businesses must grow or die, and in the public markets, public companies must grow continuously in a linear fashion with ever-increasing quarterly returns. Unfortunately, those four beliefs are not based in any science, any empirical data or business reality. They are at best half truths and some are pure fiction.
1. Growth Can Stress a Business:
Too much growth can be bad. In order to grow a small business it takes more people, more processes, more controls. Growth has to be managed. Growth has to be paced. You need processes for growth. You need controls for growth. You need people for growth, and growing a small business is managing all of that so you don’t lose control of the business.
2. Bigger Is Not Always Better:
Bigger is not always better. The bigger an entity the more complex it is to manage. The bigger you become, it puts you into different competitive spaces, and therefore you have bigger and better competition.
3. Improve or Die (or How to Outrun the Bear)
To stay in business you don’t have to grow. What you have to do is constantly improve your customer value proposition better than the competition. Business is no different than basically that old joke about the two guys walking in the woods who come across the bear and one guy looks at the other guy and says, “We got to outrun the bear.” And the other guy says, “No, we don’t.” “I just have to outrun you.” That is business. You just have to out compete the competition and deliver more value and continuously improve to the customer.
4. Growth Is Not a Continuous Linear Function
Companies that grow in a continuous manner for four years or more are rare, are the exception. The longer the term, if you go out 7 years or 10 years it is very rare. Growth is not a continuous, linear, mechanistic, deterministic function, and so the research shows that what we believe about growth is basically completely wrong.
Directed / Produced by
Jonathan Fowler & Elizabeth Rodd
The conventional wisdom that all growth is good is not based on real science, empirical data, or business reality.
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Political division is nothing new. Throughout American history there have been numerous flare ups in which the political arena was more than just tense but incideniary. In a letter addressed to William Hamilton in 1800, Thomas Jefferson once lamented about how an emotional fervor had swept over the populace in regards to a certain political issue at the time. It disturbed him greatly to see how these political issues seemed to seep into every area of life and even affect people's interpersonal relationships. At one point in the letter he states:
"I never considered a difference of opinion in politics, in religion, in philosophy, as cause for withdrawing from a friend."
Today, we Americans find ourselves in a similar situation, with our political environment even more splintered due to a number of factors. The advent of mass digital media, siloed identity-driven political groups, and a societal lack of understanding of basic discursive fundamentals all contribute to the problem.
Civil discourse has fallen to an all time low.
The question that the American populace needs to ask itself now is: how do we fix it?
Discursive fundamentals need to be taught to preserve free expression
In a 2017 Free Speech and Tolerance Survey by Cato, it was found that 71% of Americans believe that political correctness had silenced important discussions necessary to our society. Many have pointed to draconian university policies regarding political correctness as a contributing factor to this phenomenon.
It's a great irony that, colleges, once true bastions of free-speech, counterculture and progressiveness, have now devolved into reactionary tribal politics.
Many years ago, one could count on the fact that universities would be the first places where you could espouse and debate any controversial idea without consequence. The decline of staple subjects that deal with the wisdom of the ancients, historical reference points, and civic discourse could be to blame for this exaggerated partisanship boiling on campuses.
Young people seeking an education are given a disservice when fed biased ideology, even if such ideology is presented with the best of intentions. Politics are but one small sliver for society and the human condition at large. Universities would do well to instead teach the principles of healthy discourse and engagement across the ideological spectrum.
The fundamentals of logic, debate and the rich artistic heritage of western civilization need to be the central focus of an education. They help to create a well-rounded citizen that can deal with controversial political issues.
It has been found that in the abstract, college students generally support and endorse the first amendment, but there's a catch when it comes to actually practicing it. This was explored in a Gallup survey titled: Free Expression on Campus: What college students think about First amendment issues.
In their findings the authors state:
"The vast majority say free speech is important to democracy and favor an open learning environment that promotes the airing of a wide variety of ideas. However, the actions of some students in recent years — from milder actions such as claiming to be threatened by messages written in chalk promoting Trump's candidacy to the most extreme acts of engaging in violence to stop attempted speeches — raise issues of just how committed college students are to
upholding First Amendment ideals.
Most college students do not condone more aggressive actions to squelch speech, like violence and shouting down speakers, although there are some who do. However, students do support many policies or actions that place limits on speech, including free speech zones, speech codes and campus prohibitions on hate speech, suggesting that their commitment to free speech has limits. As one example, barely a majority think handing out literature on controversial issues is "always acceptable."
With this in mind, the problems seen on college campuses are also being seen on a whole through other pockets of society and regular everyday civic discourse. Look no further than the dreaded and cliche prospect of political discussion at Thanksgiving dinner.
Talking politics at Thanksgiving dinner
As a result of this increased tribalization of views, it's becoming increasingly more difficult to engage in polite conversation with people possessing opposing viewpoints. The authors of a recent Hidden Tribes study broke down the political "tribes" in which many find themselves in:
- Progressive Activists: younger, highly engaged, secular, cosmopolitan, angry.
- Traditional Liberals: older, retired, open to compromise, rational, cautious.
- Passive Liberals: unhappy, insecure, distrustful, disillusioned.
- Politically Disengaged: young, low income, distrustful, detached, patriotic, conspiratorial
- Moderates: engaged, civic-minded, middle-of-the-road, pessimistic, Protestant.
- Traditional Conservatives: religious, middle class, patriotic, moralistic.
- Devoted Conservatives: white, retired, highly engaged, uncompromising,
Understanding these different viewpoints and the hidden tribes we may belong to will be essential in having conversations with those we disagree with. This might just come to a head when it's Thanksgiving and you have a mix of many different personalities, ages, and viewpoints.
It's interesting to note the authors found that:
"Tribe membership shows strong reliability in predicting views across different political topics."
You'll find that depending on what group you identify with, that nearly 100 percent of the time you'll believe in the same way the rest of your group constituents do.
Here are some statistics on differing viewpoints according to political party:
- 51% of staunch liberals say it's "morally acceptable" to punch Nazis.
- 53% of Republicans favor stripping U.S. citizenship from people who burn the American flag.
- 51% of Democrats support a law that requires Americans use transgender people's preferred gender pronouns.
- 65% of Republicans say NFL players should be fired if they refuse to stand for the anthem.
- 58% of Democrats say employers should punish employees for offensive Facebook posts.
- 47% of Republicans favor bans on building new mosques.
Understanding the fact that tribal membership indicates what you believe, can help you return to the fundamentals for proper political engagement
Here are some guidelines for civic discourse that might come in handy:
- Avoid logical fallacies. Essentially at the core, a logical fallacy is anything that detracts from the debate and seeks to attack the person rather than the idea and stray from the topic at hand.
- Practice inclusion and listen to who you're speaking to.
- Have the idea that there is nothing out of bounds for inquiry or conversation once you get down to an even stronger or new perspective of whatever you were discussing.
- Keep in mind the maxim of : Do not listen with the intent to reply. But with the intent to understand.
- We're not trying to proselytize nor shout others down with our rhetoric, but come to understand one another again.
- If we're tied too closely to some in-group we no longer become an individual but a clone of someone else's ideology.
Civic discourse in the divisive age
Debate and civic discourse is inherently messy. Add into the mix an ignorance of history, rabid politicization and debased political discourse, you can see that it will be very difficult in mending this discursive staple of a functional civilization.
There is still hope that this great divide can be mended, because it has to be. The Hidden Tribes authors at one point state:
"In the era of social media and partisan news outlets, America's differences have become
dangerously tribal, fueled by a culture of outrage and taking offense. For the combatants,
the other side can no longer be tolerated, and no price is too high to defeat them.
These tensions are poisoning personal relationships, consuming our politics and
putting our democracy in peril.
Once a country has become tribalized, debates about contested issues from
immigration and trade to economic management, climate change and national security,
become shaped by larger tribal identities. Policy debate gives way to tribal conflicts.
Polarization and tribalism are self-reinforcing and will likely continue to accelerate.
The work of rebuilding our fragmented society needs to start now. It extends from
re-connecting people across the lines of division in local communities all the way to
building a renewed sense of national identity: a bigger story of us."
We need to start teaching people how to approach subjects from less of an emotional or baseless educational bias or identity, especially in the event that the subject matter could be construed to be controversial or uncomfortable.
This will be the beginning of a new era of understanding, inclusion and the defeat of regressive philosophies that threaten the core of our nation and civilization.
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