I ask questions and I am not alone in this, but I don\u2019t think that enough people ask simple questions.\u00a0 When headline earnings are declared or a company declares that an executive director has received (paid himself?) a bonus I want to understand the pathway that led to that number.\u00a0 Not everything, but it has to make a little bit of sense.\u00a0 I want common sense to be regarded as a high art, more valued than spin or shiny brochures.<\/p>\n
If a business sells unnecessary insurance to a customer, is that bad business practise?<\/p>\n
On the one hand the customer should check what they are buying and if they don\u2019t need the insurance they should say no.\u00a0 Why does the customer say yes?\u00a0 The salesperson makes a compelling case, or presents the information in such a way that the default settings sound plausible.\u00a0 Is this immoral?\u00a0 The buyer may have real needs that go unfulfilled because they have bought this unnecessary product.\u00a0 Should the seller aspire to a moral code of conduct or is this a case of buyer beware, and that is where the onus remains?<\/p>\n
In a way this is the heart of the problem.\u00a0 The seller is only able to do this mis-selling if the seller is a trusted entity.\u00a0 The seller is only able to do this misspelling if the buyer is bamboozled by terminology that sounds complex and clever and by marketing material that holds together.<\/p>\n
This would not happen if the trusted entity is in fact trustworthy i.e. acting morally.\u00a0 In a world where some companies act morally and others do not the best defence is an enquiring mind, a confidently enquiring mind.\u00a0 If large numbers of buyers ask simple questions until they understand what the seller is trying to sell, it does not even require training but it does require confidence.\u00a0 Confidence in simple maths will always wash off the befuddlement that is conjured by a confident salesman.\u00a0 And if the confidence is trickery it will break up and be exposed but if there is something sensible under it then that too will come to light.<\/p>\n
So I repeat.\u00a0 If a business sells unnecessary insurance to a customer, is that bad business practise?<\/p>\n
If the customer remains forever under the illusion that the insurance was necessary, and feels reassured and happy then maybe the insurance was a good thing.\u00a0 This could fall under the category of doing a bad thing for a good reason…. but. \u00a0But it will only remain good if the customer never finds out that things might have been otherwise, never discovers that he\/she has been duped.<\/p>\n
When the customer finds out that they have been lied to or cheated, stolen from, made out to be a fool, all happiness is gone.\u00a0 The customer will probably not return any time soon.<\/p>\n
Selling someone stuff that they don\u2019t need is short-term-ism.\u00a0 It is usually driven by corporate decree or by the type of measurement applied to the employee doing the selling and the incentives offered to such a person.\u00a0 The employee is acting for short term gain.\u00a0 By extension, the middle managers and the top executives are demanding this type of short term-ism.\u00a0 This is a sort of Ponzi scheme that relies for continued success on a steady supply of fresh punters to be duped.<\/p>\n
This is one part of the question.\u00a0 The other follows.<\/p>\n
For a company that sells shares on the stock exchange, sales numbers feed into the public numbers, the measures that are used by people who buy shares to gauge the health and profitability of a company.\u00a0 When extreme short-term thinking feeds into the public numbers, the public numbers may look good but there is no easy way to for the share buyer to interrogate those numbers and determine whether the \u201cgrowth is sustainable\u201d.\u00a0 And that is just the honest share buyers.\u00a0 It is possible that the share buyers are aware of the share price \u2013 sales numbers \u2013 Ponzi scheme but they want to get in, and out again, and make a profit on the trade.<\/p>\n
Very little exists within the scheme to encourage long term thinking or honesty and there is no way for me to change that.\u00a0 But everyone who comes into contact with these numbers can be confident enough in their own native intelligence to ask why and how and for whose benefit.<\/p>\n","protected":false},"excerpt":{"rendered":"
I ask questions and I am not alone in this, but I don\u2019t think that enough people ask simple questions.\u00a0 When headline earnings are declared or a company declares that an executive director has received (paid himself?) a bonus I want to understand the pathway that led to that number.\u00a0 Not everything, but it has … Continue reading The High Art of Common Sense<\/span>