It is pretty easy for us to lose track of the real causes and impacts that shape our businesses and our lives.
In fact, I like to say at the start of any consulting arrangement that the most important thing we are going to do together is diagnose the reality of your situation.
Why is that the most important thing?
Because for most of us, we do an exceptional job of diagnosing the pain, but a terrible job of actually uncovering the roots of that pain.
Peter Drucker wrote about trying to look at society from a bigger picture and uncovering the 3 issues that really drive your business.
And, I think that is a useful thing for us to think about right now.
In the United States, we just had a change of administrations and with that change a switch of parties. Which in normal times would mark a significant change in the way that the US does business within its borders and outside of its borders.
With Donald Trump, we have seen a president that wants to take a sledgehammer to business as usual. No matter what that means as a strategic decision.
What this does for people’s businesses in America and around the world is that there is an additional layer of uncertainty that might last for the entirety of a Trump presidency.
The bigger thing to think about is what caused the election of Trump and created this environment for businesses, people, and countries around the world.
I think the 3 biggest items that brought Trump about and why they are important to keep in mind are:
1. Long term lack of truthfulness with the American public:
As a society, we have done a pretty poor job of having conversations with our citizens about the real costs and investments needed to maintain and grow our economy.
This has led to short term decision making or obstructionism due to political expediency.
It has bred this idea that all taxes are drains on the economy.
That we don’t have to constantly invest in public infrastructure and make decisions with the long term in mind.
It has failed to inform decision making on things that are hidden taxes on our society like health care, poor public education outcomes, and the need to reshape our economy in a way that a mature economy would evolve over time.
This list could and is a lot longer, but the big issue for any of us operating or growing businesses is that without a truthful understanding of the business, government, or societal environment, we can’t make good decisions.
If our decisions are made on pain and short term political expediency, our society will be unhealthy. If our society and our communities are unhealthy, ultimately, our businesses are unhealthy.
For me, it is akin to the saying, “A chain is only as strong as its weakest link.”
The same goes for a country or a society.
2. Feckless leadership:
Both parties are guilty of this.
It is much easier to whistle dixie and kick the can down the road when reelection is just around the corner than it is to take hard decisions and wrestle with them.
When you hear calls for term limits and politicians mewling about needing expertise, you only have to look for what passes for political courage and leadership in Congress to think that maybe term limits might be a good idea.
If they work for the president and governors and mayors and a lot of other offices, why not Congress?
I think the desire to maintain “power” is one part of this fecklessness, but another is the amount of money that is needed to run a credible campaign for public office in most cases.
This need to raise substantial sums of money creates an environment where politicians have to be pulled in so many different directions that they can’t possibly keep a balance between the demands of so many constituencies.
While many people might say that special interests are buying power, I think as much as anything in a lot of cases, its not overt buying, but sort of a long term whittling away of your core.
Which sounds even worse, I think.
But it leads to leadership that does something far from lead.
3. Economic growth that doesn’t lift all boats:
I remember reading in a biography of JFK that he jawboned business leaders with threat of political action if the workers didn’t share in the rewards of improved efficiency during the 1960s.
Oh, how times have changed.
We a great deal of income inequality around the world.
This is bad because it drives a sense of hopelessness in the working class and people striving to improve their position.
This is probably a 40 year trend that has caused more and more strife around the globe.
This challenge actually has a multitude of reasons that it is problematic for society and industry:
First, in the US, our economy is driven by consumer spending. The more money people have, the more money circulates through the economy. This drives people’s ability to move up, buy, and create a healthy sustainable society.
Second, uncertainty is harmful for business.
Full stop!
This inequality in rewards has created instability and uncertainty. It has driven down home ownership, new businesses opening, and many other indicators.
Long term, this kind of uncertainty will cause more strife and increased pressure for significant swings in the other direction.
Again, as with the lists above, we can highlight many, many reasons that inequality is a drag on our businesses and our society.
The big point is that it is pretty easy to just look around and say that business sucks because a Democrat is in charge or a Republican is in charge.
It is much more valuable to look at the long term trends and how those impact and will continue to impact your business.
By the same token, what would it take for those to change or how can you use those societal factors to manage your business more effectively?