Monthly Archives: September 2014

09/19/14

Breaking Business

Digital image. Wired. 

While Vince Gilligan’s ground-breaking drama Breaking Bad explores a variety of societal themes, including moral consequences and the role of family, it also illustrates several foundational business principles that apply regardless of industry.

The success of Walter White’s empire hinges on his ability to produce a consistently superior – 99.1% pure – product, yielding a competitive advantage over his rivals. The quality of his product substantially increases market demand, while the purity allows him to minimize waste, decreasing costs and hence increasing margins. In addition, he is “able to differentiate his [brand] in the marketplace;” (Gurnett) his product easily identifiable by the trademark blue colour. To distribute his product, Mr. White enters into several business partnerships, utilizing his partners’ established supply networks as channels to facilitate the sale of his products. Well positioned for success, Walter’s “company” encounters exponential growth.

However, as Walt experiences growing success, he allows the flaws within his character, chiefly his hubris, to negatively influence his business decisions and relationships. The vengeful ambition – borne of a missed opportunity – that fueled his success, eventually initiates his demise. As was the case with Enron, as well as countless others, Walt’s moral decline began with small ethical violations, before culminating in serious crimes, in his case the murder of several inmates and the betrayal of his partner. Again paralleling the Enron scandal, Walter’s pride induces a belief in his own invincibility (Schumpeter); that his actions will bear no consequences. While his character is eventually redeemed, he cannot escape the consequences of his past, and he pays the ultimate price for his transgressions.

Schumpeter. “The “Breaking Bad” School.” The Economist. The Economist Newspaper, 28 Sept. 2013. Web. 19 Sept. 2014. <http://www.economist.com/news/business/21586801-best-show-television-also-first-rate-primer-business-breaking-bad-school>

Gurnett, Kelly. “5 Career Lessons From ‘Breaking Bad'” Business Insider. Business Insider, Inc, 22 Sept. 2013. Web. 19 Sept. 2014. <http://www.businessinsider.com/career-lessons-from-breaking-bad-2013-9>

Cuffin, Eddie. “The 10 Lessons ‘Breaking Bad’ Taught Us About Running A Business.” Elite Daily. N.p., 30 Sept. 2013. Web. 19 Sept. 2014. <http://elitedaily.com/money/entrepreneurship/the-10-business-lessons-we-learned-from-breaking-bad/>

09/9/14

Is Bain Capital Becoming More Socially Responsible?

toms_420

As private equity firm Bain Capital acquires half of Toms, we see the fusion of two widely contrasting cultures of thought. Bain Capital could perhaps be best characterized as profit-driven and lacking a “social conscience.” Indeed, one could contend that the company is an accurate representation of Friedman’s views on corporate social responsibility; that the sole responsibility of the corporate executive is to “make as much money as possible while conforming to the basic rules of society.” Juxtaposed against Bain Capital is Toms, which adheres to Freeman’s stakeholder theory, championing the principle that “for-profit and a bottom-line focus didn’t have to be in conflict with for-good.” Founder Blake Mycoskie, and by extension Toms as a whole, accepts Freeman’s notion that the modern company has a responsibility not merely responsible to the “financiers,” as Friedman proposes, but also to the “customers, suppliers, employees, and community.” By investing in Toms, it would appear that Bain Capital is buying into Freeman’s “stakeholder theory,” and endeavouring to become a more socially responsible corporation. However, one might allege that Bain Capital is using the “cloak of social responsibility” to promote profits, the firm itself noting that Freeman’s stakeholder theory “has deep, real resonance with the consumer.” Whether Bain Capital is genuinely invested in helping the community, or merely pursuing profits, it is abundantly clear that corporate social responsibility plays a pivotal role in today’s business world.

Rupp, Lindsey, and Devin Banerjee. “Toms, the Company That Donates a Pair of Shoes for Every Pair It Sells, Just Sold a 50% Stake to Bain Captial.” Financial Post. Financial Post, n.d. Web. 12 Sept. 2014. http://business.financialpost.com/2014/08/21/toms-shoes-bain-capital/

N.d. Business Week. Web. 12 Sept. 2014.