German and Japanese Stakeholder Capitalism

People in Germany and Japan…do not have quite the same views about money and motives as Gordon Brown and Bill Clinton have. They tend to believe that, although money is a splendid thing to have, and few people would not put themselves out to get some, if you want to know why people work hard, … Continue reading

Supermarket Owner Gives Away Stores to his 400 Employees

Joe Lueken, who owns and manages two grocery stores in Bemidji, Minnesota, and one in Wahpeton, North Dakota, is retiring at age 70. Instead of selling his stores to the highest bidder, though, he will transfer ownership to the stores’ 400 or so employees. The employees will participate in an employee stock ownership program, receiving … Continue reading

It goes back way before Citizens United…

These organizations [joint stock companies] had raised hackles from the very beginning. Sir Edward Coke (1552-1634), for example, had complained that “they cannot commit treason, nor be outlawed or excommunicated, for they have no souls.” Two centuries later, the lord chancellor, Edward Thurlow (1731-1806), echoed his words: “Corporations have neither bodies to be punished, nor … Continue reading

The rape of a mattress company

The investment firm, which bought Simmons in 2003, has pocketed around $77 million in profit, even as the company’s fortunes have declined. THL collected hundreds of millions of dollars from the company in the form of special dividends. It also paid itself millions more in fees, first for buying the company, then for helping run … Continue reading

The Stock Market: Explained! by 1950s educational videos

Two gems I found on DVD. Sadly, since I don’t own the copyright, and don’t feel like getting into a kerfuffle with anyone, for now I’m just going to put them behind a password on Vimeo for our own internal use. So, Team TRADE PRACTICES, you know what to do. If anyone else is reading … Continue reading

G&D and SmartCard/SIMcard Market

The European Telecommunications Standards Institute developed the GSM, or Global System for Mobile Communications, to standardize 2G cellular networks. The SIM card is a key feature of the GSM — it’s the vehicle for a Subscriber Identity Module that “stores network-specific information used to authenticate and identify subscribers on the network.” A SIM is embedded into … Continue reading

Corporate Governance: Stakeholder Theory

Comparative studies of corporate governance: Anglo-Saxon (Shareholder) model vs. German/Japanese Stakeholder model. Notes from Allen, Franklin and Douglas Gale. “A Comparative Theory of Corporate Governance.” Anglo-Saxon corporate governance (US, UK) is based on the Adam Smith model of organizing the economy. “The role of the firm in society is precisely to create wealth for shareholders … Continue reading

Warren Buffett

See here for Buffett’s influential NYT op-ed, “Stop Coddling the Super-Rich” Buffett’s TIME 100 2012 profile (written by Barack Obama, because why not) In the spring of 1942, an 11-year-old boy from Omaha made his first big investment, putting nearly his entire fortune — about $120 — into three shares of Cities Service Preferred. By June, the … Continue reading

Nucor Employee Relations Philosophy

Our relations with employees are based on these four clear-cut principles: Management is obligated to manage the company in such a way that employees will have the opportunity to earn according to their productivity. Employees should feel confident that if they do their jobs properly, they will have a job tomorrow. Employees have the right … Continue reading

More about Iverson and Nucor

Nucor: Ken Iverson

To my eyes, two of the most fascinating sights to behold are hot metal in motion and a group of people in headlong pursuit of a shared purpose. Those images are the essence of Nucor. They convey how we turned a confused, tired old company on the brink of bankruptcy into a star player in … Continue reading

Securency Scandal

Federal police have charged two Reserve Bank of Australia currency firms, Securency and Note Printing Australia, along with several of the company’s former senior managers with paying massive bribes to foreign officials in order to win banknote supply contracts. In a series of dawn raids, AFP agents swooped on houses across Melbourne, arresting six former … Continue reading

Mr. Welch and Mr. Lucky

For the past twenty-four years, I have had a lucky charm — a brown leather briefcase — that has come with me everywhere. My assistant, Rosanne, has nicknamed it “Mr. Lucky.” I won the briefcase in an Atlanta golf tournament in 1977, the year I first came to Fairfield. It has seen better days. It’s … Continue reading

King Arthur Flour, American corporation

Ok, I swear I’m trying to be on vacation and not do work, but then we were buying some flour to make pizza dough, and I remembered that King Arthur Flour was on some list we found of the oldest extant companies in the U.S. Reading the back of the bag of flour confirmed that … Continue reading

Guinness Family History

[The Guinness family owned the brewing company for seven generations of men named Arthur] When the first Arthur Guinness died in 1803, the Second Arthur, as the eldest son to enter the family business, became the patriarch and head brewer at St. James’s Gate. In 1820, when the Second Arthur withdrew from his management role … Continue reading

Stakeholder Economics

Shareholder value theory: companies exist to make money for their shareholders. Milton Friedman, 1970: “The Social Responsibility of Business is to Increase its Profits.” In the opinion of Jack Welch, former head of GE, Strictly speaking, shareholder value is the dumbest idea in the world. Stakeholder value theory: companies exist for the benefit of their … Continue reading

Johnson & Johnson Credo

written by Robert Wood Johnson in 1943. While they may not always follow this credo, it’s a short piece with a lot of punch. We believe our first responsibility is to the doctors, nurses, and patients, to mothers and fathers and all others who use our products and services. In meeting their needs everything we … Continue reading

The UPS Approach

notes on Soupata, Lea. “Engaging Employees in Company Success: the UPS Approach to a Winning Team“. Society for Human Resources Management Online. The UPS company-wide vision is based on founder Jim Casey’s philosophy of good management, and on UPS principles and priorities. UPS has a “Winning Team” strategic initiative, an “effort to attract, develop, and … Continue reading

Costco: “New Luxury” for American Consumers

notes on Gertner, Jon. “Costco Nation.” Money. 32.10 (2003): 124-129. Business Source Premier. America’s favorite luxury warehouse. Costco’s high-end items are a huge part of their appeal to the American middle class. Costco is good — indeed, Costco is exceptional — at knowing what middle-class Americans need: peanut butter, paper towels, Snickers bars and lots and lots … Continue reading

Decency Means More: Costco vs Walmart

notes on Cascio, Wayne F. 2006. “Decency Means more than ‘Always Low Prices’: A Comparison of Costco to Wal-Mart’s Sam’s Club.” Academy of Management Perspectives 20 (3). 26-37 Wal-Mart’s focus: lowest possible prices, always. Company’s core values seem to drive its exploitative and even illegal behavior. How do they get their low prices? “Low wages for … Continue reading