excerpt from Chapter 6 - flood example

Chapter 6 - page 102

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One excellent example of “Constructive Capitalism” came from Home Depot who shut all their stores in the Southwest US during the Austin, Texas floods in late 2013.  As part of their relief effort, the Home Depot shipped warehouses full of supplies and sent their staff to the flooded area to immediately start rebuilding the damaged communities.  The employees were paid in full their regular salary and all their travelling expenses.

Hurricane Katrina in New Orleans (August 2005) was still a fresh memory in 2013, and no one wanted to see the same thing happening in the city of Austin, so Home Depot mobilized almost five thousand employees, delivered untold truck loads of supplies and utilized their management skills to deliver on-ground support to those affected by the floods.  Just to be clear, the Home Depot was not involved at all in the initial rescue or relief effort but rather the rebuilding efforts that followed.  Fortunately, the rescue and relief efforts were pretty well managed as opposed to Katrina, so the rebuilding process could start right away.  The Home Depot did not wait for insurance issues, local zoning discussions or the media.  They just started rebuilding and repairing people’s homes so the owners could move back in.

The effect was immediate and astounding for Home Depot.  Home Depot had forfeited a sizable portion of their marketing budget to fund this effort but certainly reaped the rewards from a business standpoint.  Their brand value sky-rocketed as did their stock price following the Austin floods.  By March of 2015, Home Depot’s stock price had almost tripled to just under $200.  When asked about their efforts at the time to make such a large commitment, the CEO said that he just could not sit back and watch people in trouble when he knew he had the resources at his finger tips to do something about it.  He pointed out that Home Depot was monstrously successful in the South Texas area and that he felt that they should contribute as much as possible.  Many share holders at the time questioned his decision as they felt that the Home Depot was going to potentially forego billions in sales as a result of the rebuilding effort and that the materials should not have been just “given-away”.  Home Depot at the time made it clear to the stock-holders, that as a part of the local business community, they had an obligation to be involved in the rebuilding of its communities whenever required.  It is not moral to profit from the suffering of its customers.  This was revolutionary corporate thinking.

Today, the Home Depot has a regular rebuilding program that goes to disaster areas all over the world and pitches in “on-ground” as required.  They are under no obligation to wait for governmental efforts other than not to interfere with rescue efforts.  

Excerpt from Chapter 6 -- Constructive Capitalism

Chapter 6  --  page 100

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One of my guiding business principles is what I referred to as “Constructive Capitalism."  Let’s face it, I got rich simply by making the world a better place.  That was always my goal from a young age.  I’ll be honest and admit that I also went into business for recognition, wealth and challenge.  However, I always operated with the philosophy that I would like to build a legacy that would be respected.  When my company developed the efficient food product known as “NutrisHouse” Bars which delivered a person’s complete nutritional daily requirements, then that really was the fulfillment of my dreams.  I ultimately have far surpassed any and all of my hopes.

Upon my company’s ultimate success in the USA and Europe, we then started developing the same food products for poorer countries.  The products for these regions cost about a third of the more consumer-oriented products that were being sold and marketed in the western areas.  Of course, everyone knows that the flavor was not as good and the packaging was not as elaborate, but the nutrition value was the same.  Every single country in the world that imported NutrisHouse Bars saw improved health almost immediately.  Even where there were still dictators and civil wars at the time, the health of the citizens improved.

 “Constructive Capitalism” evolved as a concept that in essence requires a company in order to be successful to do doing something tangibly beneficial to improve the state of the world.  This was not necessarily a unique concept that I developed, rather a progression of the changing consumer-mindset and some companies realizing that it was in their best interest to go this route in order to maximize profitability.  “Constructive Capitalism” was also not just about financial contribution either.  Just writing a check to a charitable organization seemed unsettling to most people after the success of NutrisHouse Bars where genuinely positive results were being realized.  Consumers would not accept anymore that if a company does business they just cannot hand over a payment to make them feel or in the worst case scenario, look good.  The contribution of the company must be genuine, involve the resources of the company and be done with the spirit of improving the conditions in the surrounding areas.  Even in the US, the spirit of corporate contribution became more about first-hand infrastructure development rather than continuing to do “fun runs, bake sales and raffles”, as Bill Gates put it in 2007.

Excerpt from Chapter 1 - changing perspective towards wealth

Chapter 1 -  Pages 8 & 9

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Historically, where the personal valuation had gone awry, however, was in terms of the origin of one's individual wealth.  The mere possession of money had come to supersede the means of accumulating it.  In the early twenty-first century, any individual could accumulate wealth with no regard to the impact one made on other individuals or society. The worst aspect of that system, however, is that one could accumulate wealth at the expense of others.  This was a flawed model, as the most aggressive people and organizations, that seemingly prioritized wealth and power, ended up accumulating a disproportionate amount of both and subsequently started persecuting and taking an authoritative position in relation to those who had less.  This ultimately led to the “Occupy Movement” in 2011 and 2012.

America fortunately came to realize that accumulation of wealth at the expense of others is not wealth that should be judged as valuable or honorable. Through the “New Freedom Initiative” (NFI), wealth that was accumulated without adding value to individuals or society, started to become less respected or desired, and per my initial point regarding human judgment, “unsavory money” actually became judged as negative by a great majority of Americans.  Just as an easy example, banks in America came to refuse drug money out right by 2015.

The effect of this unsavory label was to encourage individual and corporate wealth-building as a result of benefiting a wider group of society.  It would also serve to keep those who had amassed their fortunes in a less than honorable manner from having personal influence or access to broader political, business or social institutions.  No one ever argued that any individual could not make money in America any way they liked.  What came to pass, however, was that the holding of that money did not automatically include power and influence along with it.

By the mid-2030s, ethics have since returned and are now a key component to wealth-building such that the amount of money that one accumulates is reasonably proportionate to the contribution one makes throughout that process.

In today’s world, those individuals that provide the greatest benefit to society receive the greatest return in terms of money, property, power and authority.  As a result, most people can claim a higher level of happiness and stability in 2043 than they ever could in 2013.  This claim to happiness extends well beyond American borders into parts of the world where in 2013 even having a claim on clean water was rare.  The world genuinely has improved significantly as a result of changed attitudes toward money.

The Recognition Era - What It Means "Top Ten" List

As the world becomes less focused on accomplishment and more on recognition here is what we can expect.  Here is a proverbial Top Ten list split into two postings.

Firstly, an overall decrease in quality of just about everything.  From clothes, to cars, to food you name it, it will get worse.  The exception of course will be at the high-end or luxury type items whereby those who can afford quality will be able to purchase it.  Everything will be built or grown to ultimately be disposable so quality will be a secondary goal.  Consumers expect their products now to be functional and design-oriented.  Durability is not something younger generations strive for as they are used to products being replaced regularly due to advancing technologies, evolving trends which has lead to an inherent obsolescence of goods and services.

Two.  Transiency.  There will be an increased growth in movement as people can simply leave one area or sector where they are not getting enough attention and search out greener pastures.  The easiest way to get recognition is to be the "new guy" as expectations are usually lower while attention is usually at its peak.  People will however, will still want to gravitate upwards in their careers so expect a lot more movement as candidates for internal promotion become less and less available.

Three.  Sound-bites.  The recognition era is of course driven by short attention spans and digital media.  Therefore, do not ever expect to have time to explain yourself fully.  Every message including personal conversation has to be delivered quickly.  The result will be that society and business more forward in a piece-meal fashion and requires leadership who can respond quickly and effectively but also mobilize those around them to respond as well.  Think of it as flash mob leadership.

Four.  Inconsistency.  Most people these days hold more of a go with the flow approach.  Just look at the political world to see that what the candidates said five years ago is no longer meaningful nor are they even individually accountable for it.  The world is changing very fast and new information surfaces constantly so what worked last week may no longer be even relevant.  Planning will become less influential when compared to the need for speedy reaction times.

Five.  Success.  Success will not be 100% measured in terms of pay and income.  Flexibility of working, unique processes and freedom of action will become paramount.  No one who thinks they are special want to do things the same way as everyone else.  Quick promotion and titles will be more important.  Expect the companies that get and retain the best people to be the ones with the least amount of management.  Plus, many younger people have access to their boomer parents wealth and know they are OK financially.

Numbers 6 through 10 will be available on Wednesday, June 20, 2012.

Posts From the Road: Denton Record-Chronicle

I am on a mutli-city road trip for the next couple of weeks so I will take my inspiration from news stories found in the local newspapers:  As I am currently in North Texas so I will comment on the Denton Record-Chronicle cover story regarding the use of original artwork to decorate storm drains with an environmental agenda.  http://www.dentonrc.com/local-news/local-news-headlines/20120426-storm-drains-to-sport-murals.ece
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The art world is one that I support and participate in.  I have several original artworks in my own collection and have contributed to several performance art groups over the years.

There are four aspects to the art world.  1) the purists who feel art should be a statement of the artist only, 2) businesses who buy and sell at all levels from high-end masterpieces to retailers who sell wall hangings, 3) hobbyists who dabble and perhaps someday hope to make a living and 4) the uninvolved which is basically 95% of America which holds no real affinity or passion for it.

In the instance, local artists are developing art pieces that are attached temporarily to storm drains to discourage dumping of toxins into the system as they drain directly into Lewsiville Lake.  The question I pose is whether artwork done at the request of a specific municipal government or with the sole purpose of creating an environmental message a valid form or art?

I would propose that it absolutely is art. Art is the product of what I would refer to as skillful imagination and reflects aspects of culture and humanities.  I would further add that art has always been developed with some form of commercialism or to support a societal trend.  Michelangelo painted the Sistine Chapel at the behest of the Catholic church, Impressionists in their period almost all had benefactors who subsidized them and they ardently tried to be seem at Salon in Paris, Picasso painted pictures on napkins as currency for his drinking and perhaps even Jackson Pollock who was a definitive troubled artist relished in his fame for a period before succumbing to his alcoholism.  Many governments over the years as well have utilized artwork to craft their cultural vision though in fairness you can easily dismiss these attempts at state directed artwork as horribly unethical.  Obviously I am referring to Hitler and Stalin in this instance.

Some of the greats of the 20th century as well were quite amenable to making their artwork available for purely advertising purposes.  Norman Mailer comes to mind as one of the greats who utilized his artwork for Coca-Cola and TIME magazine.  If you extend art to include musicians then I think one of the goals of 99% of today's`modern recording artists is to have their music selected for use in advertising so commercialism obviously is not a deterrent to them.  Why would visual artists be held to a higher standards other than the fact that some purists hold them to a higher expectation and therefore are extremely reluctant to allow them access to galleries and press coverage.

I would suggest then in the 21st century it should not be surprising in the least that artwork has shifted to reflect societal trends as a driving force for the inspiration of many artists.  Plus, as benefactors rarely exist anymore and any type of cultural funding continues to be cut, then artists need to make a living so simply through necessity they are required to take contracts that may not necessarily reflect their true identity but enables them to put bread on the table.  The world of the struggling artist is one thing that has not changed much over the years.

The subjectivity of art though has not changed one bit.  Whether art is hanging in the MOMA or attached to a storm drain, it is still up to the individual who is viewing it to have final say as to whether it appeals to them or not.  Art should never be limited or restricted due to its purpose and should just be evaluated by effect.  In reality, today`s storm drains might be the great treasures of the future.

Post from the Road: Dallas Morning News

I am on a mutli-city road trip for the next couple of weeks so I will take my inspiration from news stories found in the local newspapers:  As I am currently in North Texas I will comment on the Dallas Morning News cover story regarding the alleged bribery scandal at Walmart in their Mexican operations.
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One significant challenge all multinational companies face is adapting their current business practices to foreign cultures.

The Walmart story is a perfect example of just such a challenge. Walmart (it is claimed) paid bribes mostly in 2005 to local government officials in order to accelerate the process of Walmart expansion in Mexico.  Obviously bribery is an illegal business practice.

The second questionable behavior is in terms of Walmart's investigation of the in incident and the subsequent silence and evasion to regulatory agencies.

This second issue reflects the requirement for transparency in private companies and is testament to the need for the "Spirit of Law" mandate I set out in a prior post (April 12, 2012).  Companies need to at a minimum attempt to play by the rules and not try to hide findings purely for the desire of avoiding poor press and subsequent drops in share holder value.  It is inherent in any fairly run organization, that shareholders have access to truthful information in order to make educated decisions in terms of financial investment.  Executive level management has to come to believe in this philosophy and "the Spirit of Law" provisions would be useful in ensuring appropriate behavior. In instances like this though whereby obviously illegal activities are being undertaken then the Executives need to be liable and subject to criminal punishment.

The bigger issue of course goes back to the first point regarding the bribes. In the era when Sam Walton was in charge, Walmart was generally seen as an extremely admirable and ethical organization in context of its operations. Walton would never have authorized or condoned bribery as he knew that was bad for business in the long run. Short-term profiteering once again is just testament to the selfishness and shortsightedness of many of today's CEO's. It is also representative of the win at all cost too many of today's boomer possess overall in their attitude towards life in general.

American companies specifically have to become the role model for appropriate corporate behavior globally. There can be no challenge to put ethical agenda as a primary objective of business expansion. American companies have to be the benchmark on how foreign companies conduct their operations and also how foreign governments learn to work with them. Economic expediency can never be the only purpose of an American company in a foreign land. The era of exploiting foreign nations is long over.

Finally, as more and more countries around the world have access to capitalism then there is more and more competition for investment dollars. American companies have to be the ones that lead the way in making their profits honestly and ethically in countries where they operate. American companies have to embrace the mindset that if they do business in a foreign land then they have to bring the experience and advanced business knowledge to those regions in order to expedite global development. Successful business practices by these American companies will have positive influence over foreign areas and aide to bring them into a positive, honest and free market environment. Under this model, American companies can thrive by opering new markets without having to embrace the poor business environment that preceded them.

The notion of "ethical capitalism" I put forth earlier (February 28, 2012) is the future for American companies. Brand value and revenue streams will flow to the companies that operate in the most humane and honorable way possible. Corporate valuation and investor confidence will be given not from just domestic operations but international as well.

Bringing Back Ethics: "The Spirit of Law"

America needs to bring back morality and ethics into the private operations of corporations and in the mindset of individual citizens.

One hallmark of the modern world is that organizations, corporations and individuals try to find loopholes in the system that work for their advantage and then stand on the their principals and claim that they did nothing wrong when it blows up. This practice absolutely has to be ended.

The recent Wall Street meltdown is a primary example of this practice whereby the financial firms ultimately had a whole team of lawyers who tear apart every piece of legislation in order to find the gaps or the opportunities within the legislation that are open to them. They then proceed to find ways around the overseeing institutions such as the SEC in order to continue their actions. 

The obvious problem in this approach is that it undermines the intent of the legislation and results in border line illegal activities that benefit very few people but also serve to undermine society in general. Whether one sees intervention in the private sector as socialist or not it has been demonstrated time after time that if left to its own devices, the free market forces will do what is in their selfish best interest and then not be held accountable for any damage done to others.  They do this with a clear conscience as they are able to claim that they have technically done nothing illegal.

The issue is not that they have been able to usurp the legislation rather that what they have done, though not technically illegal, it is definitely 100% unethical.  Morality has gone out of the current American way of thinking.

However, in order to overcome this monstrous gap in America, weherby societal ethics have been abandoned by the "ME generation", what needs to be implemented are "Spirit of Law" provisions whereby the actual intent of the legislation is considered legally binding over and above the actual specifics of the legislation itself.

In today' world, it is pretty unrealistic to imagine that any legisaltive body would be able to create a set of rules that will cover every and all future situations that might arise or have yet to be imagined.

The "Spirit of Law" legal provision will make individuals and corporations legally bound to follow through on the intetnion of the legisaltion rather trying to find ways to circumvent it. Under the "Spirit of Law" mantra any entity that finds loopholes in legislation and then exploits them would be held criminally liable and subject to prosecution.

Americans have to embrace a mindset whereby they respect the intent and spirt of the US way of life rather than imagining ways to co opt it for their own selfish purposes. 

News Media: Just Give Me The Facts

News media needs to stop entertaining so much and get back to investigation.

Freedom of the press is truly one of the greatest differences between the US and the rest of the world.  It exists truly as one of the series of checks and balances of the US system. It was partially envisioned to act as the watchdog for the general public in terms of rooting out wrong-doing within the various systems of US society i.e. business, politics, ethical actions, criminal activity

However, the news media has in the last twenty years just become an entertainment medium like any other and really serves virtually zero beneficial purpose other than general informing.

Outlets of all mediums has to serve a more tangible role in the modern world rather than being so willing to be spoon-fed the news and manipulated by influential private PR companies. In the worst case scenario which has become so prevalent, many news media outlets have just become part of the process and exist purely to serve an agenda under the guise of being a news agency.

The internet has certainly become a new medium for reporting but unfortunately due to lack of access and resources by the people who are striving to reveal the facts and truth it is mostly just opinion fueled rants that drives the content so little actual information is considered reliable. Further, even when it is proven reliable information there is usually such a backlash due to the ethical nature of the organization sharing the information that the information is overshadowed. WikiLeaks is a prime example.

What needs to evolve is an independently funded media that does not have to rely on subscribers or advertising for its operational budget and does not have to answer to society for what it reports on. I would suggest that the news media world should pool its resources rather than being in a competitive environment  such that the original intent of the media is to represent public interest rather than have to rely on that same public for its revenue. Currently, the public is more interested in being entertained rather than informed so they should not have the ability to influence news reporting.

Proper Usage of Military Forces

The American military has three primary roles:  1) to protect American interests around the world; 2) to assist nationally and internationally in times of natural disaster;  and 3) to intervene in foreign genocidal conflicts and wars of aggression.


The American military can no longer exist as an instrument of American political will unless formally engaged by the ruling government or a treaty organization.  The era of America embracing a "manifest destiny" mindset as rationale for being involved in foreign national development is over.


American intervention should no longer be used even as a threat in the modern world.  Let's face it, we no longer follow through anymore so the threat is rarely a deterrent anyway.


American interests need to be clearly defined as those with business, social or individual components.  Humane and appropriate economic treatment of corporations and citizens that are operating or living within a foreign land need to be adhered too.  If any attempt is made to nationalize businesses, inflict inequitable taxation or operating standards, or inflict personal injury upon individuals then the military has a right to defend it's institutions and citizens.  Intervention however,can only occur when these injuries are incurred outside the legal parameters of the country in which they are are incurred. Americans though, need to be cognizant of the threats inherent wherever they do business and if they choose to enter a specifically dangerous area then they assume that risk as part of their normal freedom of operations.


When natural disasters occur the American military as well as the military units of other countries should be made available in terms of manpower and resources to incur a safe zone within the affected area and to support relief efforts.


Intervention is warranted whenever tyrannical foreign leadership is utilizing genocidal tactics as instruments of control and power.  A prime mandate in the 21st century for the American military is to uphold human rights and protect civilians from persecution by their own government.  The world has to come to realize that the number one offense that any government can inflict on it's citizens is death.  Government has inherently an obligation to create a peaceful environment for it's citizens and orchestrated extermination of any portion of that population will meet with immediate intrusion by military forces.  The style of government is inconsequential.


Intervention by the American military during periods of national uprising or civil disobedience is not warranted at the outset of any conflict.  Civil uprising and governments defending their position is a natural part of nationalistic development and America has no role in disputes of that nature. However, that being said, if conflicts continue with no resolution in sight, then America can be invited to participate by the ruling government.  It is not America's role to pick sides in civil conflicts.  Let's face it, if foreign countries had decided to support the south during the American Civil War then the results may have been very different and our nations sovereignty and right of self-determination would have been severely undermined and we likely would have developed very differently.


Any act of aggressive attack by a foreign country by another nation shall meet with American intervention as well.  War of acquisition is no longer a valid form of conflict in the modern world and has to be opposed by strength.  Historical boundaries are still quite often in conflict and on occasion governments have tried to re-establish historical boundaries.  This is not a valid reason for military action against a neighbor.  The era of extending national boundaries and influence through international territorial expansion is a thing of the past.


In the future, it is is highly probable that wars of acquisition will occur in order to gain access to the world's most valuable natural resources (oil, water and precious metals). When conflicts of this nature arise America has the right to be involved as a means of protecting the assets of foreign countries and establishing a global rule or territory and ownership. America will also have the right to intervention if any valuable resource is being withheld as a means of the foreign country establishing some type of political advantage. The military however, cannot be involved if resources are being sold elsewhere as this would have to be addressed in the private and public sectors.


The bottom-line for the 21st century is that our military has a definitive role that can be utilized in a more specific roles.  The end result will be the ability for America to adopt a more consistent role in the deployment of it's military and one that will be welcome and appreciated when it is utilized. By managing the military in this manner it will give America a favored position in the world as the military becomes seen as a beneficial presence globally rather than an unwelcome intruder.

"Ethical Capitalism"...The Next Big Thing in Corporate Profitability

Corporate America is the foundation of America's strength.  The greatest hope for America are its corporations...really!


Many people would likely argue that corporations are self-interested, money-grabbing organizations devoid of any human empathy.  And, this is in fact in most instances is probably quite true. But, embedded inherently within that attitude lies the potential for that self-interest to make a significant positive impact on Americans.

The business movement that is currently evolving is that corporations will see increased profits as the direct result of benevolent actions. I refer to this as "ethical capitalism".

Case in point is the "green" movement.  As public pressure and business opportunities are created due to a demand for cleaner environmental initiatives then it has been demonstrated that this is an area where companies will focus their attention.  The decision by corporations to pursue profits in the environmental arena is a business one and not personal.  To my earlier point, businesses will naturally gravitate to the revenue opportunity and therefore environmental initiatives have become part of the American corporate mindset thus providing a strong sustainability platform for long into the future.


What should be the next step in the green revolution of profitability is that corporations profit more from doing societal-friendly activities.  From a marketing perspective, companies have long known that being seen as part of the community and a good corporate citizen is good for business. Companies will line-up for opportunities to sponsor charitable causes and to provide safe products because the consumer population demands them and it is good for their brand building objectives. Therefore, corporations know that the appearance of being a good citizen is good for business in terms of building brand value and from a product standpoint safety leads to a reduction in the number of law suits and reducing insurance premiums.


The next tactic then in the evolution of corporate contribution is to go well-beyond charitable support, fund-raising and brand building and to make resources and expertise available to the public at large.  For an easy example, one area where corporations can have a dramatic and immediate impact is in terms of disaster relief.  Whenever something happens around the USA the corporations should be the first ones on the scene to help.


The Hurricane Katrina flood in New Orleans could have benefited dramatically from local and national corporations by having access to their expertise in order to provide relief, rebuild the city and care for those affected by the devastation.  A wide variety of companies could easily have pitched in by providing human expertise, labor, supplies, management coordination rather than just providing funds or basic supplies like water and blankets.  Further, corporations are used to working within an integrated network of other companies and suppliers to achieve their goals which is something that governmental agencies cannot claim.  It would have been much easier for a home improvement retailer to work with engineers and contractors to rebuild parts of the city rather than having to wait for governmental resources to coordinate the effort.  Corporations also have the luxury of operating by objectives and have to be less considerate of public attitudes.


If corporations actually pitched in first-hand to actually address the immediate problems then they would be rewarded by increased brand recognition, sales increases and consumer loyalty...all of which which would lead to enhanced profitability and stock price for the company. The result of "ethical capitalism" is increased corporate benefits to the bottom-line through benefiting America.