Notes to self

I’m going on holiday for a bit, so no posts for the next week or so; when I come back I want to write about Personal through professional identity as well as economic and national identities.

In the meantime, though, sunshine, old churches and Lee Child novels. Excellent.

Striking a Pose

The European School of Management and Technology have recently produced a management case study based on the career of Madonna. Her ability to create a brand, (including choosing the right people to perpetuate that brand) and her aptitude in changing that brand at will at remaining recognisable have been cited as containing useful lessons for business. It would be fair to ask, “but why only now?”; after all, Madonna has been successfully branding and re-branding herself for close to two decades now. This case study can be seen as a salute to her sheer tenacity in a notoriously fickle industry – it seems unlikely that those who, in the 1980s, commented on who Madonna might be this week could have predicted her continued run of successes.

For women in less rock and roll industries, too, the news seems good. Recent research by Catalyst indicates that companies with women in upper management have higher profits than those without, and these findings apply across all industries. PepsiCo are soon to become the largest company (by stockmarket value) to be run by a woman, Indra Nooyi. This evidence points to gains made by individual women, but also indicates that hiring women in the highest management positions could mean a competitive advantage for a corporation.

Nevertheless, women are still grossly underrepresented in upper management. Only 11 of the Fortune 500 companies are run by women. Why, given the evidence above, should this be the case? In considering an aspect of this question, it is helpful to return to the example of Madonna, specifically her willingness to flaunt the evidence of her success. Her current adoption of typically upper class British sports such as horse riding are not only an important part of her latest brand, but also a clear signal that she has the means to live that lifestyle; her ‘Sex’ book in the early 1990s blatantly positioned her as a ‘have’ in the war between the haves and the have-nots. Whilst these moves have not always been without controversy, they have consistently situated Madonna as a successful woman. Whilst it may be a tired cliché that the impact of having been encouraged from a young age not to “show off” holds women back in their career, the lack of willingness to do so may be a factor in an unfairly slow career just as the apparent enthusiasm with which Madonna approaches “showing off” has been a factor in her success.

Evidence that women are less likely to broadcast their skills may be found in the entries to business schools. Entry for women to business degrees has levelled off at 30%, compared to 40% for law and medical degrees. Any one of these three careers – business, law, and medicine – have a work/life balance unfavourable to family life, so other factors are likely to be important. In industry, an MBA or business qualification can be what sets an employee apart; in law or medicine, the degree is necessary to practice. For this reason, taking a business degree is a form of self-promotion in the workplace. If women are not putting themselves forwards for one easily monitored opportunity to advance in industry, who knows when else they are not pushing their workplace advantage aggressively enough?

Narziss Und Goldman

Machiavelli’s The Prince and Sun Tzu’s The Art of War have, for some time now, been hailed as useful texts for managers or those who would manage. Less popular – or more likely, less easy to market, given its 700 page bulk rather than pamphlet-like slenderness – has been Montesquieu’s The Spirit Of The Laws. This work, published in France in 1748, expounds upon what governs the making of laws in the four kinds of state; the democratic republic, the aristocratic republic, the monarchy and the despotism. However, the way in which Montesquieu delineates the running of the eighteen century state can be just as useful a model the running of a business in the twentieth and twenty first centuries.

Goldman Sachs’ time under John Weinberg can be typified as an aristocratic republic, which revealed itself most clearly in what essentially amounted to an imposition of sumptuary laws upon his staff. Salaries were paid into the bank’s capital accounts, and staff had to request that the money be released; whatever was actually being earned, spending was controlled and, by extension, austerity encouraged. This was a fundamental tenet of Montesquieu’s view of the aristocratic republic. He used aristocratic not in the sense that the word would now be understood, of hereditary privilege – in The Spirit Of The Laws, the word is used to mean ‘chosen by merit’. Those who are chosen by their merit to have power (as we can assume those high up in Goldman Sachs would be) should not have luxury added to this power as this would cause unrest amongst those who had not been chosen. Instead, greater power should also mean greater restrictions on the type of lifestyle lived.

In Montesquieu’s monarchy, by contrast, luxury was necessary to lift the level of all those within the state. Moving away from the financial industry, bosses of companies such as Microsoft and Google could be seen to be practising monarchic governance of their companies. At Microsoft, the layout of the office serves the needs of the employees regardless of the expense – whilst the office design has changed, for a time each employee had a door they can shut when they do not wish to be disturbed. At Google every employee is encouraged to work on their own ideas. Both of these things could be considered luxuries at software companies where rigid deadlines and a need to cut costs mean that employees in the industry rarely enjoy such privacy or creativity. However, both of these things are a result of an upper management which, famously made up of people who can afford to live in personal luxury, is prepared to spend money on its employees to afford them the privileges of privacy and creativity; as Montesquieu advised, to maintain the happiness of the populace by allowing them to benefit from the working practises of those far above them in rank.

Recently, however, there appears to be an emerging trend towards what Montesquieu might have recognised as despotism. Pay packages for those in the higher echelons of companies are on the increase. So, The Economist believes, is narcissism in bosses, measured by metrics such as prominence in company press releases and the ratios of the boss’s cash and non-cash compensation to those of the firm’s second-highest paid executive. Also included in this list is use of the first person singular in interview, an indicator which could indicate a desire to concentrate power and to dictate from the top. Narcissism, especially, seems to point the way to an increased role for the Vizier – supposedly the closest and most trusted advisor, in fact the base flatterer that Montesquieu believed to be the hallmark of despotic rule. Whilst those in positions of power, in states and in industry, have ever surrounded themselves with people they find agreeable, the current (seemingly increasing) disregard for other’s opinions seems to lead directly to the rise of the sycophant and a self-serving exercise of power. It is the famous truism of The Sprit Of The Laws that the republic ends in luxury and the monarchy in poverty; narcissistic bosses would do well to note that the despotism ends in revolution.