Books
Value Shift by Lynn Sharp Paine
The Support Economy by Shoshana Zuboff and James Maxim
Value Shift
by Lynn Sharp Paine
(McGraw HIll)
Were it not for the years HBS assistant professor Rakesh Khurana spent
Enron, WorldCom, Arthur Andersen, Tyco. A glance at the business headlines of the last year might easily convince anyone that the old adage is true: “Business ethics” is a contradiction in terms. But ironically, says HBS professor Lynn Sharp Paine, it may well be the steady rise in expectations for corporate behavior that has helped bring such cases to light.
In her new book, Value Shift: Why Companies Must Merge Social and Financial Imperatives to Achieve Superior Performance, Paine has condensed twenty years of research and teaching in the oftenmaligned field of business ethics to argue that companies can — indeed must — be both ethical and profitable. Paine contends that the demand for a higher standard of performance has been emerging for decades in response to the corporation's expanding presence in society. Globalization, privatization, and technology have added impetus to this trend in recent years. To be a leader in business today, companies are expected to do more than create wealth and produce superior products and services. They must also conduct themselves as “moral actors” — responsible agents that bring moral judgment to bear on their activities. This development defies centuries of corporate theory, says Paine, who cites a long line of thinkers who have maintained that corporations are by nature amoral. In Value Shift, Paine argues that the corporate amorality doctrine has outlived its time. She points to abundant evidence, starting with the daily news and including numerous studies and surveys, to show the extent to which companies today are viewed as proper subjects of moral assessment. In Paine's schema, which likens society to a large civic association, companies can choose to be “dues payers,” “sustaining members,” or “sponsoring members,” but they cannot realistically choose ethical indifference.
Citing examples from around the world, Value Shift provides solid strategies for integrating an ethical perspective into management practice. Paine argues that companies need to go beyond the codes of conduct and values statements that have become ubiquitous in recent decades and move toward what she calls “centerdriven management” — an approach that takes both ethical and economic imperatives seriously. Paine's book speaks directly to those responsible for a company's performance —executives, entrepreneurs, directors, managers — but any stakeholder in the global economy (read: everyone) can find relevance in its message.
— Margie Kelley
The Support Economy
by Shoshana Zuboff
(Viking)
Enterprises shaped by the principles of managerial capitalism have built tremendous wealth in the United States and much of the rest of the world over the past century. However, in their new book, The Support Economy: Why Corporations Are Failing Individuals and the Next Episode of Capitalism, HBS professor Shoshana Zuboff and her coauthor and husband, James Maxmin, a former CEO, contend that such success has also created a new society of individuals whose complexity and needs reach beyond the current business model. They argue that a chasm exists between today's stress-weary individuals and the organizations upon which they depend for employment and consumption. That chasm, while marked by conflict, frustration, and mistrust, contains the seeds of economic growth and with it a further evolution of capitalism itself.
Zuboff and Maxmin begin by discussing the growing movement toward “psychological self-determination,” a trend viewed warily by some scholars. For their part, Zuboff and Maxmin maintain that increased individualism is “a cause for celebration.” They point to “transaction economics,” bolstered by the social relations of managerial capitalism, its chronic “inward focus,” and its tendency toward “organizational narcissism” as fatal limitations that prevent traditional corporations from understanding and addressing the needs of this new population. Today's individuals want more than efficient delivery of goods and services — they want control of their lives and are willing to pay for it. Addressing these needs, the authors say, could spark the next leap forward in wealth creation.
This new business model envisioned by Zuboff and Maxmin is based on “distributed capitalism,” in which value resides with the individual. Each person or family is sustained with “deep support” delivered via “federations” of enterprises and concierge-style “advocates” coordinating every need from grocery delivery to health care. Maintaining the individual-centered character of the model requires digital technology to provide financial linkages so that all payment originates with the individual and is disseminated to providers in real time. Similar technology is needed to achieve “infrastructure convergence,” which eliminates administrative activities across enterprises, dramatically reconfiguring costs so that support is accessible to people of all income levels. Zuboff and Maxmin state their aim as “the beginning of a conversation” challenging present assumptions about capitalism, commerce, and the logic of economic growth.
