Posts tagged with: business

I ran across this video yesterday (courtesy of ESA), which I thought presented some interesting challenges and issues:

The video was presented on Upworthy as an example of something “all white people could do to make the world a better place,” that is, use their white privilege to address injustices.

A number of economists, including Milton Friedman and Thomas Sowell, have written about the power of the market economy to overcome racism and discrimination, to put people into relationships on the basis of economic decision-making rather than skin color. As Friedman contended,

the preserves of discrimination in any society are the areas that are most monopolistic in character, whereas discrimination against groups of particular color or religion is least in those areas where there is the greatest freedom of competition.

But as a conversation I had with some others about the video also illustrates, there are times when (at least in the short run interests of the firm), something like profiling can seem to make some economic sense. The successful passing of one bad check can really hurt a store’s margins. Practically speaking the stores often take a complete loss.
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There’s a real business advantage to treating employees well, says Jim Sinegal, CEO of Costco Corporation, an international membership warehouse club. Boasting the lowest employee turnover rate in retailing, Costco pays 40 percent more than its closest rival, Sam’s Club, and provides health insurance to more than 90 percent of its employees.

“Wall Street is in the business of making money between now and next Tuesday,” Sinegal says. “We’re in the business of building an organization, an institution that we hope will be here 50 years from now. And paying good wages and keeping your people working with you is very good business.”

Chris Horst, Matthew Horst, Costco

For Matthew Horst, Costco has become much more than an employer.

And the advantages don’t stop at profit margins and good wages.

In an open letter to Sinegal and president Craig Jelinek, Chris Horst of HOPE International shares a beautiful story about how Costco gave his brother a career, a community, and much, much more: (more…)

prayer“How is religion related to entrepreneurial behavior?”

As Joe Carter pointed out last week, a new study by Baylor University sought to examine this very question.

Focusing specifically on American entrepreneurs, researchers Mitchell J. Neubert and Kevin Dougherty found that although entrepreneurs “appear no different than nonentrepreneurs in religious affiliation, belief in God, or religious service attendance,” they do “tend to see God as more personal, pray more frequently, and are more likely to attend a place of worship that encourages business activity.”

Baylor recently posted some interviews with the researchers to get their thoughts first-hand (HT). Dougherty, an associate professor of sociology, emphasizes that in a time of economic recovery, we should pay close attention to any area that might impact those looking to start a business:

We’re at a particularly important time for the promotion of entrepreneurship, coming out of a recession, not just in our country, but globally, so if there’s a time period where we need people engaging in new business creation, now is the time, and if religion has something to do with that, it’s important to know what that is and how that occurs.

Neubert, an associate professor of business and entrepreneurship, notes that although this particular study doesn’t get into why entrepreneurs pray more or what exactly they pray about, he hopes that future research will examine these areas more fully. (more…)

Blog author: jsunde
Wednesday, April 17, 2013
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sale-sign1J.C. Penney recently gave up on last year’s strategy to abandon sales and coupons in favor of “everyday low pricing.” As an article in the New York Times points out, “simplifying pricing, it turns out, is not that simple”:

“It may be a decent deal to buy that item for $5,” said Ms. Fobes, who runs Penny Pinchin’ Mom, a blog about couponing strategies. “But for someone like me, who’s always looking for a sale or a coupon — seeing that something is marked down 20 percent off, then being able to hand over the coupon to save, it just entices me,” she said. “It’s a rush.”

Devoted coupon users like Ms. Fobes may be more frugal than the typical consumer. But most shoppers, coupon collectors or not, want the thrill of getting a great deal, even if it’s an illusion.

The article goes on to indicate  that this type of illusion-seeking and the corresponding “rush” are sometimes due to certain levels of conditioning:

Even Walmart, which actually does pull off the trick of “everyday low prices” in its domestic stores, is finding it hard to convert consumers to a single-price model in countries like Brazil and China, where retailers give deep discounts on a few main products, then mark up the rest, said Mark Wiltamuth, an analyst at Morgan Stanley.

The problem, economists and marketing experts say, is that consumers are conditioned to wait for deals and sales, partly because they do not have a good sense of how much an item should be worth to them and need cues to figure that out.

Just having a generically fair or low price, as Penney did, said Alexander Chernev, a marketing professor at the Kellogg School of Management at Northwestern University, assumes that consumers have some context for how much items should cost. But they don’t.

Yet as AEI’s Mark Perry notes, from a producer and seller’s perspective, such schemes come in response to the ever-evolving and unpredictable demands of the consumer—in this case, particular shopping preferences. This is “not an enviable position to be in,” Perry writes, “to be at the mercy of fickle and unpredictable consumers.” (more…)

If your next date night costs you more, you can thank Obamacare. Regal Entertainment Group, the country’s largest movie theater chain, has announced that it is cutting employee hours due to Obamacare related costs.movie tickets

One Regal theater manager told FoxNews.com the move has sparked a wave of resignations from full-time managers who have seen their hours cut by 25 percent or more.

“In the last couple weeks, managers have been quitting on a daily basis from various locations to try and find full-time work,” said the manager, who asked not to be named. “Regal up until now has never restricted anyone to anything below 40 hours.”

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“Is there a religious way to pump gas, sell groceries, or advertise for a craft store?”

In a new paper, “God and the Profits: Is There Religious Liberty for Money-Makers?,” Mark Rienzi asks the question. (HT)

Rienzi, an assistant professor at the Columbus School of Law at The Catholic University of America, writes in direct response to the federal government’s HHS contraception mandate, focusing on the religious liberty challenges faced by for-profit companies. As Rienzi argues, imposing such penalties requires “singling out religion for disfavored treatment in ways forbidden by the Free Exercise Clause and federal law.”

From the abstract:

Litigation over the HHS contraceptive mandate has raised the question whether a for-profit business and its owner can engage in religious exercise under federal law. The federal government has argued, and some courts have found, that the activities of a profit-making business are ineligible for religious freedom protection.

This article offers a comprehensive look at the relationship between profit-making and religious liberty, arguing that the act of earning money does not preclude profit-making businesses and their owners from engaging in protected religious exercise.

Many religions impose, and at least some businesses follow, religious requirements for the conduct of profit-making businesses. Thus businesses can be observed to engage in actions that are obviously motivated by religious beliefs: from preparing food according to ancient Jewish religious laws, to seeking out loans that comply with Islamic legal requirements, to encouraging people to “know Jesus Christ as Lord and Savior.” These actions easily qualify as exercises of religion. (more…)

PovertyCure was featured in Forbes Magazine last week. Alex Chafuen, one of Acton’s founding board members, featured PovertyCure in his article on champions of innovation. He writes:

A new multifaceted initiative, called PovertyCure, provides abundant materials and resources for those who want to create lasting solutions to poverty. The program is founded on the conviction that each human person can be a source of great creativity. It highlights the incentives needed to unleash the entrepreneurial spirit that fills the developing world.

Chafuen also calls attention to PovertyCure’s focus on the big picture:

Many intellectual entrepreneurs and some of their donors and “angel investors” tend to be single-product champions. They focus on only one element in the road to reduce poverty, e.g., women rights, property titles, vaccines. This could lead to neglect of the fundamental problems that impede successful outcomes in their area of work… A fruitful dialogue among participants in PovertyCure can increase the chances that poverty or “human flourishing” programs will be structured with the proper incentives.

Instead of focusing on what we can do to solve poverty, the real question is how do people in the developing world create prosperity for their families and communities.

Learn more about PovertyCure, their network of over 180 organizations, and order the new PovertyCure DVD-Series, a 152-minute documentary-style series that challenges conventional thinking and explores the economic and theological foundations of human flourishing.

Trade and Mutual AidIn the forthcoming issue of Comment magazine, I examine how free trade orients us towards the good of others. In doing so, I argue against the value of pious banalities and cheap slogans. I include examples like, “Go in peace; keep warm and well fed,” or, “When goods do not cross borders, armies will.” The latter is often attributed to Bastiat, and while it captures the spirit, if not the letter of Bastiat’s views, the closest analogue is actually found in Otto Tod Mallery: “If soldiers are not to cross international boundaries on missions of war,” wrote Mallery in 1943, then “goods must cross them on missions of peace.”

I was struck by the disconnect between ideology and reality, or between idealism and realism, in an anecdote from a recent foreign policy speech from Sen. Rand Paul. As Paul notes,

In George Kennan’s biography, John Gaddis describes President Clinton asking Strobe Talbot “why don’t we have a concept as succinct as ‘containment.'” Talbot’s response [was] “that ‘containment’ had been a misleading oversimplification; strategy could not be made to fit a bumper sticker. The president laughed… “that’s why Kennan’s a great diplomat and scholar and not a politician.”

I guess that’s also the reason that I’ll never be a politician, either. As Lord Acton observed, “Every doctrine to become popular, must be made superficial, exaggerated, untrue. We must always distinguish the real essence from the conveyance, especially in political economy.” The key for responsible governance is not to lose sight of the complexity that lies behind popular exaggerations and conveyances.

As I argue in “Trade and Mutual Aid,” the temptation to rest easy with simple formulas to complex problems is common, but must be resisted: “Divorced
from a more comprehensive conception of the human person and social flourishing, an uncritical reliance on free trade to solve the world’s problems can well become destructive.” Even so, I conclude, “Free trade is a system that imperfectly, and yet with some measure of success—as Bono and countless others are beginning to recognize anew—orients us toward the good of others.” In the course of this piece, I draw on a variety of sources, including Frédéric Bastiat, Adam Smith, John Calvin, Johannes Althusius, Abraham Kuyper, Herman Bavinck, Pope Paul VI, and Friedrich Hayek.

To get your copy of the Comment issue on the topic of persuasion, including my piece on the fundamental persuasive nature of exchange, “Trade and Mutual Aid,” subscribe by March 1. You’ll also find content from new editor James K.A. Smith, Anne Snyder, Jim Belcher, Ashley Berner, Jonathan Chaplin, Marilyn McEntyre, Janet Epp Buckingham, D. Bruce Lockerbie, Calvin Seerveld, Natalie Race Whitaker, and Nicholas Wolterstorff.

Writing for the Harvard Business Review, my friend (and coauthor) John Coleman argues that business professionals can benefit from reading poetry. While his article is not directed at people of faith, I think his claims are particularly relevant to Christians in the business world:

Poetry can also help users develop a more acute sense of empathy. In the poem “Celestial Music,” for example, Louise Glück explores her feelings on heaven and mortality by seeing the issue through the eyes of a friend, and many poets focus intensely on understanding the people around them. In January of 2006, the Poetry Foundation released a landmark study, “Poetry in America,” outlining trends in reading poetry and characteristics of poetry readers. The number one thematic benefit poetry users cited was “understanding” — of the world, the self, and others. They were even found to be more sociable than their non-poetry-using counterparts. And bevies of new research show that reading fiction and poetry more broadly develops empathy. Raymond Mar, for example, has conducted studies showing fiction reading is essential to developing empathy in young children (PDF) and empathy and theory of mind in adults (PDF). The program in Medical Humanities & Arts (PDF) even included poetry in their curriculum as a way of enhancing empathy and compassion in doctors, and the intense empathy developed by so many poets is a skill essential to those who occupy executive suites and regularly need to understand the feelings and motivations of board members, colleagues, customers, suppliers, community members, and employees.

Read more . . .

Blog author: jcarter
Monday, November 26, 2012
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Every year Black Friday marks the official beginning of two modern American traditions: Christmas shopping and criticizing Walmart.

Critics on both the left and the right have found a common enemy in Walmart. Those on the left hate the company because it isn’t unionized while conservatives complain because it undercuts mom-and-pop retailers. Some researchers even claim that people are prone to gain weight after a Walmart Supercenter opens nearby.

I suspect if the researchers were to conduct a follow-up study they’d also find that there is about a 99 percent chance you will not be starving to death if you live near a Walmart store. But we live in a strange period in history when the idea of affordable food is considered a lamentable condition.

Walmart’s very business model—maintain a large and innovative supply chain that keeps prices low—offends the sensibility of those who think that prices should be raised in order to pay employees a higher wage. The idea that the higher cost should be passed on to consumers is typically made by those who would never actually shop at Walmart. A prime example is The American Prospect‘s Harold Meyerson:

Walmart replaced General Motors as America’s largest private-sector employer. Instead of paying its workers enough to buy new cars, Walmart paid its workers so little they had to shop at discount stores like Walmart.

The reason why Walmart employees—and others on the lower end of the income scale—shop at the stores is because they are, by necessity, price conscience shopper. Meyerson and other elites that spend only about 3.5 percent of their income on food at home can afford to shop at Whole Foods. But households in the bottom quintile, which spend 26 percent of their income on food, are eager to keep food prices as low as possible. (During this holiday season Walmart employees receive an additional 10 percent off most food items.) If Walmart didn’t exist they the company’s employees wouldn’t have higher paying jobs; they’d just be paying more for food and consumer goods.

Growing up in a family that lived below the poverty line,  I can appreciate the value of inexpensive food. That is one of the primary reasons I appreciate the company—and the reason I think other conservatives should appreciate it too. There is admittedly a lot to dislike about the company, but as former low-income rural resident I think there are a number of reasons why conservatives should be more supportive of Walmart (and similar poverty-alleviating corporations).
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