There's an interesting piece over at 2 Blowhards (a culture-blog I'm going to have to permalink soon) on business versus craft. Their example is from a Los Angeles Times article on animators. Many Californians in that trade have had their jobs fall victim to new technology (and new lower-wage sources of labor.) You'll think that you know where this is going, but just watch:
It's impossible not to feel for these people, since it is clear that collapse of Disney animation, at least, was hardly the fault of its lower-ranking employees. The Eddie Gorals of the animation world didn't screw up. No, clearly, the 'suits' are to blame here for bad business and artistic decisions (like the last four or five Disney animated movies, with the notable exception of "Lilo and Stitch.")
And yet, is it really fair to blame the 'suits'? Is it really the responsibility of the 'suits' to ensure that the Eddie Gorals of this world are employed at reasonably well-paid salaries doing what they love? Isn't part of the problem that the Eddie Gorals of this world want to beaver away at their craft, and don't want to be bothered to think about raising money and launching new projects that would ensure that they stay employed?
I know the tradeoff Eddie thought he was making-the 'suits' would get the big bucks and he would settle for a middle-class life-style coupled with a steady-stream of craftsmanly job satisfaction. But that didn't take into account the more-or-less inevitable outcome: that the suits (to whom Eddie had effectively outsourced the 'business' issues he preferred not to focus on) would screw up! It took them awhile, but they managed it. And he (not they) paid the price.
Blogger "Friedrich von Blowhard" makes a good point, and it's one that you don't hear made very often. It goes for the drug industry, too, as many of my readers there will have sensed immediately on reading the above. Employees at the smaller companies know this principle well, because so many of those companies collapse. Everyone working at a biotech has one eye on the exit, ready to bolt if things start to go bad.
But it works like that in the big companies, too, or it should. If you think that your high-flying pharma company is executing one of those slow, stately turns that will take it directly into the side of a mountain, you should start getting ready to jump. It can be hard, because there are often personal and family reasons to stay where you are. There's not always another place to go, either, and I appreciate that problem (having been there myself.)
It can also be tough to leave behind the vested bonuses, profit-sharing plans, and so on that your tenure entitles you to. You feel as if you can't afford to go anywher else. But those things are going to disappear if the company really does grind into the gravel, and that's when you can least stand to have it happen. I've seen some distressing examples among people who kept buying lots of their company stock in their retirement plans, for example, because it did so well. And because it did so well, it came to be a big fraction of their portfolio, well above the limits that they'll usually let you set for new purchases. And when said company began throwing piston rods and leaking oil, the stock tanked, taking all those retirement plans down with it. Then the bonuses stopped, and then the firings started.
No, Friedrich is right. You have to keep a clear eye on the people running your company. If you just read the company's official statements, and just listen to the stuff at the "State of the Firm" meetings, you'll think that everything is fine, even if it isn't.You need to think for yourself, and get all the external advice you can (from the investment community, the trade press, and so on.) Capitalism is work - that's one of the reason why it works.