I was never particularly money-grubbing or a greed head. But I did study economics (philosophy with the balls to put a number on something) and minored in Yugoslav economics. I was pretty much a communist teen, so the Yugoslav model based on the 1948 Constitution was very attractive (stay with me).
Basically, the workers at factories could vote annually to keep or oust management. Also every three months they got a check for profit sharing. Here's an amusing unintended consequence- thousands of workers who had been showing up drunk and being complete slackers were beaten to death by their co-workers.
Except for the beatings, this to me seemed like the perfect fusion of social justice and economic efficiency, and as viewed from the late 70’s it seemed a likely outcome. I thought it might be interesting to try to put in place a fair, worker empowered workplace one day and stuck it on a mental bookshelf.
Flash forward a few years, and I’m having a blast working on a variety of stuff that was the early internet. We were all young and ernest and really loved the work, and we got to see people around us making fortunes at young ages, doing what they enjoyed, treating employees extremely well and making the world a better place.
I sort of gained expertise and employees and was able to but some of those worker empowerment things into practice and, lo and behold, it worked! I was running Sales and Support at a few small internet related companies in the late 80’s and early 90’s and using radical socialist models for compensation.
In the classic sales model, it’s all against all. I only win if others lose and my success depends on the failure of others. In addition, territories and quotas, the lifeblood of salespeople were usually capricious assigned, favorites rewarded, independence punished and generally really ugly workplaces. Think Glengarry Glen Ross. Lot’s of backstabbing and negative motivation to cooperate.
This may be too much inside baseball but it’s important. We divided up territories every 6 months or so, so that everybody got a historically equal territory. In addition EVERYONE got paid on EVERY sale. The individual sales rep got the most, and his team the next largest portion, but EVERYONE WANTED EVERY SALE. That means if the other guy’s phone rang and he was out, everyone dove for the phone. We quickly developed one of, no, the most cooperative workplaces I’ve ever had the pleasure to work in. There were a few other innovations, like doing almost everything over the phone, no suits, ideal hire 2 years out of college, ALL promotions from within, and just when we got the structure set up at the #3 Internet Service Provider in America, the internet exploded and we were in exactly the right place at the right time. Soon, we were global number one, and those other guys were out of business.
The normal sales model of guys in suits in cars or on airplanes couldn’t handle the volume and we did.
Over 100 of my employees became millionaires because of stock options we’d handed out, we had the largest proportion of female management of any telecom company in the world, the best maternity leave policy I’ve ever heard of, and the happiest most motivated work force I’d ever seen.
How do you top growing from million to billions in 3 years?
You don’t. You retire. And try to make the world a better place.
And that’s it.
4 comments:
That seems like a business model that would work very well in Latin America, BUT for the fact that the people who have the capital can only see the model you proved to be counterproductive.
I wish you would consider being the Deming of the next phase of TLC's and intercountry interactive capitalism. I am afraid the people making the decisions are so anti collective that they undermine the natural tendencies (Hmm...maybe natural because it has worked in keeping people alive in marginal economies for milenia?) of Guatemalans at least, to work together for common goals.
If you weren't so busy being retired, I would pray for your movement into the consulting realm!
Thanks for sharing, Jeff. I think you got where you are because you're smart and you have a lot of energy and confidence.
But, wow. I didn't expect such a genuine, detailed explanation of your highly successful and progressive business model. What I understood of it sounds very impressive and, well, just plain enlightened.
I guess it doesn't hurt to be smart, study economics, and be at the right place at the right time! Congrats! Soak up the rays, you deserve them. But leaving the beach to the consulting realm sounds worthy, too.
I was born an artist (a curse and a blessing) but was just savvy enough to marry a plumber. I stayed out of the right place at the wrong time, running frantically away from computers, which seemed liked cryptic and magical scepters, only to be wielded by math and science wizards.
I've been trying to convince folks, along with myself, for years that art/culture is as much a necessity as plumbing and computers, but that concept has only caught on in France. Way before I entered the picture. The English and Spanish seem to value and invest in their artists, but the plumbing is still running along the outside of their buildings.
How to help struggling countries with marginal economies sounds to me as complex as the string theory, and as simple as people who care and have resources getting involved.
This is an artist talking in foreign and alien territory, so bear with me. Don't people with capital generally behave conservatively and overly cautious with their capital? I've always been fed that those who have it have it because they don't spend it, or risk it. I've noticed that those who think in more 'collective' terms are willing to risk personal loss for the sake of a group gain (which ultimately ends up to be their gain). I guess the larger the capital in the kitty, the more protective, and less focused on the workers, the operatives become. Unless you're an accountant for a large firm that has a creative bent, but I doubt the motivation there is the benefit of the workers.
Benefit of the workers...hmmm. What we really need in this country, and probably in a lot of places, is a hybrid model, part capitalism part socialism. (I thought this might be what Chavez was trying, until his wacky proposal to stay in power forever.) State side free market socialism might just happen organically a la revolution, or it might just evolve more quietly from smart and socially conscious designers. Like Jeff.
People in third world don't have the luxury of cooking up successful socio-economic models, or do they? How does one fit their grassroots activism for social change into their daily combat with hunger, disease, and no electricity or running water? As living standards rise, so does empowerment. But then there are some exceptional individuals out there working miracles in their neighborhoods.
Well, I agree with Jeff about this depression thing lurking around the corner. And then maybe we'll have our revolution. Viva la hybrid. (We've got the cars going finally.) But we better hurry up, 'cause the world is catching fire.
Paula and Steve, it's great to get the input. One of my biggest motivations for getting rich was getting to say truth to power; no actually, it was to be able to say, "Fuck you" to anyone in power and be able to back it up with lawyers, guns and money. I've fought real estate developers (dirt pimps) in Virginia, beaten Disney in its' quest to turn Virginia battlefields into theme parks, and tried to keep other pimps from paving the Florida Keys and the Everglades. I've pissed off enough business interests in Northern Virginia that they called me an environmental terrorist while I was the largest employer in the fastest growing county in the state.
We will win. It won't be easy. I look forward to buying the arms for the revolution that saves this country even as those guns are so likely to bring down my rich, shite ass.
You know what? It's not so much winning that's important as letting these motherfuckers know that not every rich white guy is one their side.
Ahem, behind every successful man . . . Hello?
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