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Revitalizing Capitalism 

Jim Correll, director Fab Lab ICC at Independence Community College, Independence Kansas  

While our economy is on “paused” due to COVID-19, let’s rethink and revitalize capitalism with a new priority. 

The ad started off with “We’re making changes to make things right.”  This was a television ad campaign a couple of years ago for a large American bank.  You may remember, or have been a victim of, their practice of creating millions of new bank accounts for their customers in order to meet sales quotas and win internal sales contests.  The only problem was the individual customers did not know of or approve the creation of these new accounts in their names. 

The ad continued by listing the three changes being made to make things right.  (Cue the running horses pulling a stagecoach through the Western countryside for dramatic effect.) 

  • Fully refunding those impacted 

  • Proactive new account confirmations 

  • Elimination of product sales goals (putting your interests first) 

Really?  Accounts should nevebe created unless initiated by the customer.    Goals should always have been to put first the interests of the customers, not to see how many accounts could be opened. 

Changing Capitalism’s Bad Name 

This story serves as a perfect example of what has given capitalism a bad name over the last one-hundred fifty years or so since the advent of the industrial revolution.  For this entire period, profit was made the primary goal.  Customer service and the rest of it all took a back seat.  The results have led to unwise and inefficient use of natural resources and inequitable exploitation of labor that resulted in an unhealthy competition between business and labor unions.  We created an education system in support of this profit-priority capitalism that we’re just now starting to convert to a system that will produce the best innovators in the world instead of laborers willing to work in repetitive, non-creative environments.  Traditional business and entrepreneurship curriculum supports this idea that profit is the primary goal.  This is the reason I don’t like or use traditional business or entrepreneurship curriculum. 

It's not that profit is bad; it just shouldn’t be the primary goal. Here’s our message to today’s entrepreneurs and business owners.  The primary goal of business should always be to provide the best solutions and services, always putting the customers’ needs first.  If you do that in the right way, people will gladly pay you for these solutions and thus, provide the profits you need.   All the successful businesses I know concentrate on providing excellent services while charging enough to be profitable.  That’s a big difference in philosophy; one that leads to great customer loyalty and plenty of profitability. 

Early Economy Was Small Business 

The economy of the early decades in America was made up of craftsmen and women in small shops, offering handmade goods. Quality was high but so were prices. The advent of large factories in the 19th century introduced an economy of scale to production making goods and services available to people of modest means. If I run a small shop selling handmade goods, I’m going to want quality to be good because I know word of mouth and repeat customers are my future. If I own a “sweat shop” where goods are mass produced, I don’t even know the end (retail) customer. I start thinking not so much about quality, but about how I can reduce cost of production, making more money. Over time, the mindset of the economy’s producers shifted from one where quality and usefulness were priorities to a mindset where profit was the priority. 

That shift to profit as the number one goal is what has given capitalism a bad name. It led to the unhealthy exploitation of workers, natural resources and even customers. It’s time to shift our thinking and emphasis away from profit as the number one goal to a primary goal of providing something useful and desirable in the marketplace while respecting and appreciating the labor of others and being good stewards of the natural resources required to make products that are useful. 

Let’s Make Offerings Exceptional 

The emphasis of providing useful and even exceptional goods and services is essential for small businesses to survive and grow, especially in a post COVID-19 economy. This emphasis is the hallmark of initiatives such as Gary Schoeniger’s Ice House Entrepreneurship ProgramJon Schallert’s Destination business strategy, Network Kansas E-Community and Kansas Main Street. 

While we’re on “pause” with millions of small business owners trying to figure out how to survive until customers can come back let’s all try to figure out how to make our products, services and offerings so useful and so exceptional that once customers can get back out, they won’t be able to resist.  

 Jim Correll is the director of Fab Lab ICC at the Center for Innovation and Entrepreneurship on the campus of Independence Community College. He can be reached at (620) 252-5349, by email at jcorrell@indycc.edu or Twitter @jimcorrellks. Archive columns and podcast at jimcorrell.com.

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