7 Responses

1. Julian Snape says:

   December 5 2020 at 4:01 pm

   Here’s my experience of the ‘Man is solitary and competing alone’ fallacy:

   I proved to myself (and others) conclusively that the co-operative model of humanity works far better than the competitive. Back in the 1980s I worked as a salesman for and Apple computer franchise in Cambridge, UK. This was in the early days, pioneering the GUI interface where most other computers were still command line. So it was an uphill sell to begin with.

   We were having problems with the sales force in that the high performers were working almost 24/7 and burning out. But new sales people just weren’t making the grade and either leaving within weeks or being sacked for underperformance. The company culture was ‘compete hard externally and internally’. As a result, the high performers who knew the system were hogging all the best leads, while the new guys were scrapping for the left overs. This resulted in the new sales people not making target and the high performers burning out and regularly losing prospects as they didn’t have time to deal with all of them.

   I and the sales team were called into a meeting to see if we could come up with a solution to help keep new sales people perform. One suggestion I made was to pool all the commission income and divide equally (provided the sales people met minimum peer assessed performance standards). This was poo-pooed in favour of the competitive model. So much so that the CEO said OK come up with a system and we’ll try it for a month just to show you it won’t work.

   So I designed a system where if the team met a certain level of sales we’d have a % of profit margin as our bonus. If we hit a higher level that month it would double. The main opposition was from the high performers who thought they would just be handing over a large portion of commission to under performers. But we went ahead anyway.

   After a month we got together and analysed the results and put it to a vote if we would keep the scheme. The vote was unanimously YES!

   Why…

   Well the high performers started giving leads they didn’t have time to follow up to the new sales guys and they were able to convert a lot of them. The high performers were also able to take more time and even holidays without worrying about loss of commission. The new sales people had more security and were happy to help the high performers when they were overloaded, and were able to specialise in various technical areas, working with each other to give customers a far better knowledgeable service. But the most interesting thing was, that the high performers were making *more commission* this way than they were under the individual competitive system. I got promoted to corporate sales manager and specialised in selling Apple computers to other computer manufacturers (such a good feeling).

   Sadly there was a sting in the tail. Our franchise rapidly came to national notice as the best performing in the UK. So much so that we were bought out by another London based franchise, who then proceeded to scrap our system and impose their own. Within weeks most of the sales force left, including me. On top of that I sold my Apple shares in disgust, becoming an inverse Forrest Gump!

   So a well designed cooperative feed back system seemed to work far better than a competitive system even in the ferociously competitive are of IT sales. But just don’t be seen to be too good!

   Julian
   • Richard Murphy says:

     December 6 2020 at 10:15 am

     Thanks

     And c’est la vie
   • Robin Stafford says:

     December 6 2020 at 1:58 pm

     Julian
     Having also worked in the IT industry, including in sales with bonus schemes, I can confirm just what you say. Shared bonus schemes prompting much more effective, team oriented behaviour. Conversely, people on very high bonuses relative to their basic salary being driven to dysfunctional and sometimes dishonest behaviour. Ironically often to the disadvantage or the company itself.
     It’s an extreme example of Drucker’s point that what gets measured gets managed … but what’s measurable is not always what really matters. As ever, the price of everything (measurable) and the value of nothing.
2. Robin Stafford says:

   December 5 2020 at 5:41 pm

   That’s wonderful and a great example of the need for real creativity if we are to break the dominance of the current economic narrative and create a new one
3. CLIVE PARRY says:

   December 6 2020 at 12:31 am

   Interesting.
   I would also recommend the Reith Lectures by Mark Carney. He explores similar themes in a rather more conventional style!
4. Pilgrim Slight Return says:

   December 6 2020 at 10:31 am

   ‘Rational self-interest’.

   Von Hayek did not consider ‘altruism’ at all when interviewed – as though it did not exist. He ignored it, as did Ayn Rand who advocated that man had no other responsibility except unto himself (‘Atlas Shrugged’).

   Both also ignore the concept of kindness and collaboration – ‘grouping’ behaviours that helped puny mankind to survive and emerge in competition with sabre-toothed tigers and other more powerful animals. But also behaviours that were heavily pregnant with the notion of reciprocity and the potential creation of social order and shared values in order to contribute to maintaining a certain level of stability in human societies – the human equivalent of the herding phenomenon.

   This is where David Graeber’s and other anthropologists work comes into play – Graeber’s observation that communist or socialist behaviours occur naturally in societies is something that I’d observed myself. It also true that societies/cultures borrow from each other – they are much more complex – what we have is what I’ve heard called ‘fusion cultures’ – and that this borrowing also acts as a lubricant when mingling successfully with other groups and keeping the peace – it creates familiarity with each other and a sense of being comfortable with one another. Man is hard wired for empathy – because it has helped him survive, as much as he can be set to war when those social conventions are destabilised.

   These people (von Hayek, Rand, Buchanan etc.,) all re-wrote thousands of years of human history almost over night and got away with it as many were not even qualified to make such assertions.

   What von Hayek and his minions did was what Adam Curtis has noted – to over-simplify life: to justify the personal over the collective – its the worse case of philosophical reductionism I’ve ever seen. To tell simple stories about who we are and what we are here for. To deny the complexity of what we are – to make it easy for us to do the wrong thing. To see no further than our noses. To see kith and kin is such a limited way.

   These caustic ideas now dominate in politics – identity politics is a symptom – where once politics was about win/win it is now win/lose – someone has to lose apparently and the winner takes all.

   What von Hayek and the others also failed to note was what their advocations did to the notion of money – it’s distribution and use. I think that they totally failed to recognise the implications and costs to society over the abuse of this utility.

   ‘Rational self interest’ is quite simply what I call ‘anti-social behaviour’ as opposed to the ‘pro social behaviours’ of kindness, empathy and reciprocity for example.

   Put simply, Thatcher is dead; it’s about time her values died with her.

   That is what 2008 and Covid has taught me.
5. Robin Stafford says:

   December 6 2020 at 1:46 pm

   Good summary PSR. For those who havn’t, definitely worth reading up on Rand and Buchanan and watching Adam Curtis’s Hypernormalisation.
   Rand’s books are turgid and unreadable – it says a lot about him that Sajid Javid claims to re-read them every year. There are enough summaries of her work out there to tell you that she and her ilk were positively sociopathic.

   There’s a a poisonous core driving the Tory party now who proudly boast about their Randian credentials. Whether it’s the damage that Brexit will cause to jobs and people’s lives, or deaths from COVID, they regard it all as worthwhile in their libertarian cause. I think it was Nick Cohen who described them as a bunch of Stalinists. People like Claire Fox or Munira Mirza feeling comfortable there rather confirms his point.