Business Education In A Liberal Arts School

There is so much I could write about this morning. I could write about the amount of money paid to Allen Mullay, CEO of Ford; or I could write about how Clark Country is actively pursuing supply chain work for Boeing; or I could write about Tim Cook’s, CEO of Apple, visit to Foxconn, the Chinese company that builds the Iphone and Ipad. Apple is pushing the Chinese company to reduce required work hours for employees to 49 from the current 60 hours. Also, Apple is requiring Foxxconn to gives its employees a wage increase. All of the actions taken by Apple will increase its cost per Iphone and Ipad by $2. I for one will be willing to pay an extra $2 for my Iphone or Ipad to help the working conditions of the workers in China.

However, what I want to focus on today is what is happening in the educational world in California. The reason I like to focus on California is I grew up there, and what happens in California usually travels to other states. Peter Berkowitz wrote an article in today’s Wall Street Journal about the situation occurring in California. The article is in response to a report entitled “A Crisis of Competence: The Corrupting Effect of Political Activities in the University of California.” The bottom-line of the report is due to the pathologies within the educational system in California college students are graduating without a comprehensive understanding of history and literature. “They are unfamiliar with the principles of American constitutional government. And they are bereft of the skills necessary to comprehend serious books and effectively marshal evidence an argument in written work.” To be fair though, this is not just a California issue, it is occurring all across the US.

The California university system has experienced curriculum changes over the years to the point that none of the nine general campuses in their system require the study of history and the institutions of the United States. None require the study of western civilization, and in several English departments a student can graduate without taking a class on Shakespeare. I find this to be very troubling, but this also encourages me when it comes to what we are doing within the Business department where I teach.

I teach business in a college that is Christ-centered and in the city for the city. It is a small liberal arts college that cares about the student who graduates from our institution. We want students who are passionate about the major they are studying, but we also want them to have a broad understanding of knowledge and wisdom, as well as have a Christ-centered passion for service. Often I wonder if it is working. Yesterday at our Students In Free Enterprise (SIFE) Regional Competition I found out it is working.

Five of our business students stood up in front of 10 corporate judges and presented information about Warner, our students, our program, and our accomplishments. They were poised, articulate, mature, and technically astute. They represented their faith, education, and themselves in a way that demonstrated the fact that faculty at Warner are doing their job. Not just business faculty, but our science, humanities, and social science departments too. These students were well educated and well prepared. I was very proud of them, and this demonstrated to me the importance of teaching business in a liberal arts environment.

And that is my thought for the day!

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Corporate America And Veterans

In yesterday’s blog I discussed the report that global poverty has been cut in half. This was accomplished through macro decisions made by governments, specifically China and India. The Economist reports the same information in its March 24th edition. While discussing the Vivek Express, a fairly new train service, it mentions that many Indians “are well off enough for a long-distance train fare, but not rich enough to fly. . .“ It appears the number of people lifted out of poverty in India is around the 52 million realm. This number represents a population the size of South Africa. The concern for the Indian government involves how to keep this growth going. “For such progress to continue, and for India to achieve its ambition to become a great power, two things are necessary: a government that keeps its finances in order and consistently fast economic growth.” Are we any different?

One of the most pressing problems effecting our society right now involves the assimilation of veterans back into civic life. With us pulling out of Iraq and Afghanistan, and the cut backs to military spending, many soldiers will be coming home to an uncertain future. Ann Curry, an NBC correspondent and Oregon native, wrote about this opportunity in the Wall Street Journal.

She starts the discussion by going back to a previous era. At the end of WWII many soldiers were coming home in a similar situation to what we are experiencing now. “As World War II drew to a close, many Americans worried about how to assimilate returning veterans. Some feared the economic boom of the war would quickly fall back to the hard times of the Great Depression as millions arrived home looking for work.” However, she makes a great point that these individuals were economic drivers for continued improvement and growth for our economy.

At the end of the war there was a balance of government spending and private investment. G.I.’s came home to the rewards of the G.I. bill. They were able to get an education, as well as receive other benefits allowing them to buy homes at reduced loan rates. Even more important was how the workplace received these individuals. The returning vets were believed to be a “boon to any business that wanted to recruit disciplined, mission-oriented and motivated workers.” Today’s veterans are no different. They are probably the most trained and experienced military force we have ever had in our history, and with the right support they can also drive economic improvement.

In my business classes we discuss the importance of a college education. Getting an education will signal future employers that the graduate has certain skills that had been developed during their years studying. We also discuss the reality of transference of skills to the workplace, which is why corporations are willing to take a chance on college graduates.

Now we have a group of trained individuals who are really good at many different things. Team work, technology, etc, all of which should signal that these individuals will be successful in the workplace. Therefore, they should be considered for the many complex jobs that are currently open and unable to be filled by the current workforce.

Does this mean that every veteran will be a successful addition to a team environment? Having worked with military people in the past, I would say no. But I have also worked with many more vets that demonstrate teamwork and dedication not expressed by other non-military individuals. I have also worked with college graduates that are self-promoting and detrimental to the advancement of the organization. I have even been told that I was not a team player.

This does not change anything. These men and women have served our country and deserve a chance to be successful when they return. As Ann Curry stated, “. . . even when a skill does not fit exactly, why would anyone doubt whether former Apache helicopter pilots or company master sergeants would be trainable?” At Boeing I worked with several vets that came in to the company with minimal skills, but proved their worth over and over by doing a great job and being an excellent team player. Managers give these folks a chance. They deserve it.

And that is my thought for the day!

Alleviating Poverty

As much as I’d like to discuss the arrest of Dominique Strauss-Kahn in France today on charges of “aggravated pimping,” I want to take the high road. I want to discuss an article dated February 16th in Christianity Today (CT). It is an article discussing the alleviation of poverty in the world. In this article CT discusses a Brookings Institute report on poverty in the world that states poverty has been cut in half. CT goes on to say that the UN Millennium Development Goal of reducing poverty in half between the years 1990 and 2015 was met three years ago. The question in my mind is how did this happen? How have the fortunes for those at the bottom of pyramid change?

CT states, “Not by large donations, micro enterprise programs, or child sponsorship, but rather sheer economic growth, has effected this change” However, the majority of this change is focused in India and China. These two countries are responsible for three quarters of the reduction in poverty within the world. The main reason for this change is macroeconomic decisions made by these countries/

CT contrasts the effectiveness of India and China with the ineffectiveness of the Church in this arena. “What these findings demonstrate is the church’s relative ineffectiveness and impotency at helping the poor. Some Christian activists have been trying to motivate us to care for the poor by pointing out how they are neglected by society. The state is a clumsy and arrogant institution, they argue, and not doing its job.” The church should step in and create micro financing opportunities and lobby governments. But why isn’t the church affective in serving the poor? Aren’t we called to meet the needs of the least of these?

The problem begins with trying to get Christians to agree on anything. Some of us believe the role of the church is to teach the word of God, and then individuals will go out and be the church. Others recognize the weakness of this premise because of our fallen nature. We would rather sit and be fed sweet nothings rather than live messy lives of ministry to the poor.

Getting involved with the messy lives of people in distinctively following Jesus. Sunday in church Pastor Don reminded me of something that is important for us to think about. The term Christian was a title given to followers of Jesus as a derogatory term. It was a put down. Therefore a more accurate description of what we need to be is followers of Jesus. As we follow Him we will meet the needs of the poor. If we are following Him, and he is the one who told us to care for the poor, then I am positive that is what we would do.

CT alludes to this fact.With this end in view, when we inevitably enter a period in history when poverty gets worse, either globally or locally, we won’t get discouraged. We are involved with the poor not because we’re going to make a difference, but primarily because we are gladly responding to the call of a gracious God to show forth the Good News – in deeds of justice and mercy, and more importantly, in gospel words – that we will defeat all forms of poverty, spiritual and material.”

It is not our responsibility to be successful, it is our job to follow.

And that is my thought for the day!

Racquetball, Squash, Lacrosse, and Networking

This week’s Business Week magazine had a very interesting article about lacrosse. The article states, “For a small, mainly East Coast sport whose exposure is largely confined to ESPN’s higher multiples, collegiate lacrosse has managed to draw more than its fair share of unwanted national attention.” The article then focuses on exotic dangers and murder, events perpetrated by Duke and University of Virginia lacrosse athletes.

Although the sport has received a black eye due to these events, the fact is that there are over 600 varsity collegiate Lacrosse programs across the United States. Lacrosse does not offer a lucrative pro career path, wages in the pro ranks are under $20,000, but the sport seems to provide a much more lucrative career path in finance. Lacrosse is viewed as a farm system for future bankers.

The sport was first observed in 1636 when a Jesuit priest watched a recorded a game played by the Huron Indians. However, in 1879 the Baltimore Athletic lacrosse coach was quoted by a Canadian paper as identifying who usually plays lacrosse. “The members are principally sons of wealthy merchants, with a good sprinkling of the merchants themselves.” The sport was invented by the Iroquois and popularized by the Canadians, but in the US it is still a breeding ground for future financial leaders in the country. “Goldman Sachs, Morgan Stanley, and other Wall Street firms are stocked with former All-American” lacrosse players. It appears to have been this way for many years. I know University of Portland has a lacrosse team.

This is nothing new. Men and women that play games together develop strong connections. These connections, especially at the collegiate level, will often lead to employment opportunities in the future. Especially if current merchants are attending games and meeting contemporary players.  This is networking.

I can remember when racquetball was the meeting place of business leaders. These leaders would compete against each other and then do business together. Squash is another contemporary networking activity where future leaders develop relationships and business deals. Don’t get me going about golf. There is a lot of business that gets done on the links.

The fact is today, like in times past, the best opportunities come from networking. It is not what you know (alone), it is who you know. Therefore, taking the time to network is critical. Everyone should have their elevator speech ready. You never know when you will meet that individual that will kickstart your career. Always be ready to give an answer for who you are. Lacrosse, golf, squash, or a quilting club it doesn’t make any difference. Good business means good relationships. It is critical to your future.

And that is y thought for the day!

PineRidge And The Lakota

There were two important interactions between myself and my students this week. First, I had the opportunity to meet with the students who are going to South Dakota in May. We will travel on May 13th to Rapid City and then drive to Allen, South Dakota. There are six students traveling with me, and we will continue to build relationships with the Lakota, do some work, and serve the Lakota in any way we can. The second event involved Students In Free Enterprise (SIFE). I watched our team’s presentation for the first time and it was incredible. We will be going to Nationals, it is that good.

However, the paper this morning had an article that made me focus on the issues of the Lakota. The article discusses the relationship of the United States government with native tribes across our continent. After reading it I was wondering if land trust affect the Lakota, and after searching the internet I found out it does. The article is entitled “At Last, Some Bright Spots in Indian Country.”

The article describes in one sentence the ongoing relationship our government has with the various tribes it oversees. The Supreme Court Justice John Marshall stated in 1831 that the federal government was a guardian of its ward, the native American. “To this day, the Bureau of Indian Affairs (BIA) is the trustee of Indian Assets.” However, that was then and this is now. According to this article, the tribes “are proving they can do better with less supervision from Washington.”

The Flathead Reservation in Montana, under the Indian Self-Determination Act of 1976, proves that modern Indian organizations can run their own lives. Montana’s “Flathead reservation took control of more than 100 programs previously run by the BIA and other federal agencies. Their success led them to lobby in 1988 to become one of 10 reservations participating in the Self-Governance Demonstration Project.” In 1995 they were given full control of their forest management. The process has allowed the Flathead tribes to employ its members giving much needed income to the reservation.

Self-Determination is the needed lesson. This lesson is nothing different than what Friedrich Hayek, Nobel Laureate, stated in his writings. Hayek felt that for our economic life to thrive it requires coordinated individual planning. This requires an economic knowledge, or how the system works, to be dispersed to each player rather than centrally maintained. In his famous work “The Road to Serfdom” Hayak argues that embracing a centrally controlled economy will lead to a fascist government, or to the domination of individual freedom.

If Friedrich Hayak were still alive today he would have said the same thing that Alberto Mingardi stated this morning in the Wall Street Journal, “Centralized government allocates resources badly – regardless of its intentions. The very nature of centralization makes it impossible to collect and compute all the information that is needed. This is true for any grand scheme of industrial planning as it is for the government led welfare systems. . .” Hayak did leave room for safety nets. We need to care for those in need, but efficient and effective systems emerge in arenas of self-determination and innovation.

This brings us back to the Lakota. How do they get themselves out of this mess? The reservation has huge levels of unemployment, alcoholism, drugs, gangs, and other modern maladies? We’ve tried for 181 years of centrally controlled planning for reservations. Maybe it is time we try something else. In the book “When Helping Hurts” Steve Corbett recognizes that our helping systems focus on relief and rehabilitation. These are necessary elements within any  disastrous event, but if we stop there, he argues, and not take step three which involves development, or improving life skills, then we have limited the level of success that could occur.
It is time to set the Lakota free. They need to take care of themselves. To do this they will need private sector partnerships, training, and self-will. It is only the Lakota who will be able to change the Lakota.

And that is my thought for the day!

Corporate Social Responsibility

I teach in the Masters in Management and Organizational Leadership (MMOL) program at Warner Pacific College. Several classes that I love to teach are done by other professors, while three classes I adore are still available to me. Finance, which is a great opportunity to look at financial decision-making and organizations; Systems Thinking, an opportunity to review the interconnected of events within an organization; and Business Ethics. I would have to say the Ethics course is my favorite. The discussions we have in class about the so-called free market and the socially responsible elements of creating wealth are exciting.

Tonight’s workshop will be especially interesting. The topics with include Corporate Social Responsibility (CSR) and Ethical Leadership. The CSR discussion will begin with Milton Friedman and end with Stakeholder Theory. These seem to have developed into polar opposites on the continuum of ethical analysis.

Friedman is usually described as the exemplar of a classic economic understanding of ethics. The only requirement for a company to be considered ethical is to ensure profit within the guidelines of the law. This is considered ethical because of created value and its positive effect on society, which is true. The second half of the discussion involves the relationship of action within the borders of law.

This implies there are problems with ethical business practices. Thus the need for guidelines. This is also true. Therefore the question is who establishes those guidelines? If we think allowing the government to establish regulation is good enough we are only fooling ourselves. Government is fallible, and can be influenced by lobbyists. Therefore, commerce will attempt to influence government representatives to ensure the interests of business are upheld. A classic example is CAFE laws. The government attempted to set miles-per-gallon standards at a level that would have been very expensive for automobile manufacturers to attain. The big three lobbied the government and was able to negotiate lower levels of fuel efficiency. I am not saying this is bad, but we must not fool ourselves when we think the government can control the ethical expression of business.

I am a proponent of corporate responsibility. This means that business must take responsibility for its own actions. It should not wait for government to tell them what is ethical business. Business must determine what is ethical and pursue it with a passion.

Usually we look at this from three vantage points: cause no harm, prevent harm, and do good. This is considered the moral minimum argument for business ethics. The cause no harm portion of the discussion is a no brainer. Any product or service offered on the market should not cause harm if used appropriately. The question though is whether business should prevent harm or do good. This is the $65,000 question that business leaders need to answer. Who cares what government does. If I have a business and decide the moral minimum is to prevent harm to society, then my business will have an ethical system greater than the legal system can create. If I choose to do good in the market, then the highest road of commerce is attained. Ray Anderson made this decision many years ago when he changed the business model associated with manufacturing carpet.

Any business needs to create profit or it won’t be in business very long, but all businesses should take the responsibility to be good civic partners. This means it needs to pay attention to the social elements of their business model as well as the environmental part too. Legal requirements for ethics is not enough, the business needs to decide what it’s ethical responsibility is, which means creating behavior that is more stringent than the law.

And that is my thought for the day!

The Budget

Yesterday I had a conversation with my investment counselor. We went over the performance of my portfolio and set up a strategy for the upcoming year. Obviously part of the discussion had to do with politics and rising fuel prices. An interesting statistic was mentioned, one that I need to double check just to make sure. No sitting President has ever been reelected if the unemployment rate was over 7.5%. If that is true we know that President Obama will do everything in his power to get the rate down. Regardless of where you stand on the political spectrum, we win.

However, this election season may see a first. Structural unemployment, which involves the change of how we work, has to play a part in this discussion. Technological shocks have lowered the need for manual labor, thus we just may need to live with a higher unemployment rate. But, we also know that many jobs are unfilled at this time due to the inability of firms to find skilled people able to do the complex critical work associated with the open jobs. It will be interesting to see what happens.

The biggest issue in this upcoming election year will be the deficit. Thus how congress deals with the budget is very important. Our national debt is approaching 73% of our economy, which should raise a red flag. We cannot sit back and do nothing, we must act. As Paul Ryan stated in the Wall Street Journal this morning, “government programs designed in the middle of the 20th century cannot fulfill their promises in the 21st century.” Something must change.

The PIG fiasco of Europe (Portugal, Italy, and Greece), almost devastated the Euro. Much of the issue involved entitlement spending. If we don’t get our spending under control we will be in even more deep water. The House of Representatives is working on a bipartisan, it seems weird that I can mention bipartisan and our current government in the same sentence, budget that is being called “The Path to Prosperity.” Catchy huh! Ryan describes this as getting the appropriate changes to our budget by “ending crony politics and government overreach that has weakened confidence in the nations institutions and its economy.” He has my attention. Any time I see the opportunity to create smaller government and put responsibility back on the shoulders of the people, I am all for it.

So what is this budget supposed to do? It will cut debt as a share of the economy by 15% over the next decade. Put the nations finances in balance, which I think means the budget will be balanced (but we’ll see). However, we do know that this means paying off debt.

The plan calls for Medicare reform, which makes me a little uneasy. However, I think all of us know that this program needs to change. Competitive bidding by insurance companies may be the ticket. Most of all the bipartisan budget calls for tax reform. The U.S. corporate tax is now the highest in the developed world. However, we do know that some corporations paid zero taxes last year. Therefore, closing the loopholes is critical to this new tax system.

President Obama has a budget and the House is developing another budget and then they negotiate to create the real budget. According to Ryan Obama’s budget “takes more from the American families and businesses by raising taxes and adding to the complexity of the tax code.” If this is true then I am against it. We need more simplicity, not more complexity.

Ryan states, “It is rare in American politics to arrive at a moment in which the debate revolves around the fundamental nature of American democracy and the social contract. But that is where we are. And no two documents illustrate this choice of two futures better than the president’s budget and the one put forward by the House Republicans.” If I were Ryan and trying to give a sense that this is a bipartisan effort I would not have used the phrase House Republicans, I would have said the budget put forth by the House of Representatives. This tells me there may not be as much support for this budget on the Democrat side as he first stated.

But, if the President’s budgets put more power into the “hands of unelected bureaucrats,” taking the ability to decide away from me then it is time for a change. I know when I make the next comment that my evolution into a Libertarian will be complete, but I stand on the Declaration of Independence in complete agreement with the founders of our country when they say, “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.” I should have the right to decide, but I also have the responsibility to care. The government cannot do that for me. So I guess that tells you which side of the social debate I am on.

And that is my thought for the day!