Over the last year we have seen many companies get called out on their poor products and poor business practices. One example would be Toyota, who almost went bankrupt due to the defective Prius they were selling across America and Europe. In 2009, we had the Salmonella contamination found within Peanut Corporation’s plants in GA, TX and VA. Recently, Consumer Reports put out a “not so positive” review on the iPhone4. In other words, Consumer Reports will not recommend the iPhone 4 due to the antenna flaw, despite the free cases.
Why is a profit so important that quality has suffered within our business industries?
Here in Phoenix, AZ we are paying the price due to the egregious behavior within our housing marketing. This behavior for making a dollar at any expense has sparked what is called Liar Loans within our mortgage industry. Lair Loans are not just a Phoenix, AZ problem but a nationwide problem.
The concern with this type of behavior is that there is always a larger payment require on the back end. In other words, when a company invests into a new product or service, any profits made from that venture will be eaten up by law suites and recalls, due to cutting corners for a few extra dollars. This is what you can call Penny wise Pound foolish.
Hard times are causing your company to cutback
Many businesses are experiencing difficult financial times within our economy. Even if your business is financially struggling, keeping everything ethical and documented is the key to strong and productive business practices. There have been incidences where companies will break the law in order to save a few bucks, incidences such as copyright infringement, wrongful termination of employees and even straight up embezzlement.
Being in business means playing by the rules at all cost. For example: Laying off employees. If your company has to go through a lay off process, consider providing a severance package along with a waiver or release. This may cost a few extra dollars to “nicely” let an employee go, versus the thousands of dollars your company can spend in fighting a law suit. Another example is hiring a tax accountant. This is a lot cheaper than owing the IRS tens or hundreds of thousands of dollars in fees and penalties.
In business the goal is not to focus just on the short term, but to plan for the long term. This behavior can be applied not just to profits, but to the life of the company.
We get it, money is tight. The worst thing a business can do is focus on their profits at the expense of other people’s misfortune. This may work for a while, but the “interest” on that repayment for this type of behavior will be insurmountable.
Copyright © 2010 Wendell Wesley