a-new-business

The financial and climate crises, global consumption habits, and other 21st-century challenges call for a “killer app.” I think I’ve found it: philosophy. Philosophy can help us address the (literally) existential challenges the world currently confronts, but only if we take it off the back burner and apply it as a burning platform in business. Philosophy explores the deepest, broadest questions of life — why we exist, how society should organize itself, how institutions should relate to society, and the purpose of human endeavor, to name just a few. ” The Wealth of Nations ,” a book that serves as the intellectual platform for capitalism, lays out how markets should be organized and how people should behave in such markets. The book’s author, Adam Smith, was not an economist, as many believe, but a philosopher. Smith was chairman of the Moral Philosophy Dept. at Glasgow University when he wrote the book. Like other philosophers, Smith attempted to create a new framework for understanding the world, addressing how we as humans seek alignment in our relationships and among competing interests. The philosophical approach Smith pursued has faded from use, yet it’s more relevant than ever in light of the crises our organizations and countries face. Credit, climate and consumption crises cannot be solved through specialized expertise alone. These problems, like most issues businesses confront in the global marketplace, feature complex interdependencies that require an understanding of how political, financial, environmental, ethical and social interests influence each other. A philosophical approach connects the dots among competing interests in an effort to create synergy. Linking competing interests requires philosophers to examine areas that modern-day domain experts too often ignore: core beliefs, ethics and character. When I say we need to return to a philosophical approach in relation to problem-solving, I mean that we need to broaden our understanding of problems by looking deeper at our own beliefs, values, ethics and character, and then understand how they relate to those of others who share a stake in our problem-solving efforts. Needed: Broader questions and goals This has grown difficult to do at the organizational level because so many of our businesses are packed with specialized domain experts. We are having trouble connecting the dots among these knowledge silos to conceive enduring solutions. Like philosophers, we as individuals and organizations need to keep values, ethics and the overall human condition in mind as we make decisions and take actions. Among other behaviors, this means hiring for character (in addition to specialized skills), considering the long-term implications (in addition to the short-term rewards) of our decisions, and figuring out how we can create value (in addition to extracting value). By taking these steps and embracing a more philosophical approach to problem-solving, we will establish our character as the 21st century’s defining competitive differentiator. As the Greek philosopher Heraclitus so elegantly put it almost 2,500 years ago: “Character is fate.” This holds true for individuals and organizations. I see growing evidence of businesses asserting their desire to address the human condition, which certainly marks a step in the right direction. My bias stems from my experience as an undergraduate at UCLA, where philosophy lit a fire inside me. By rewarding me for the careful consideration of one idea instead of compelling me to read hundreds of pages of text, philosophy helped me understand why I was struggling in all other academic areas. I studied philosophy for seven years before I went to law school, where I took eight classes in jurisprudence, which is essentially the philosophy of law. A more ethical corporate sector Although I pursued my philosophical studies because I was inspired by the subject, I also reached a conclusion that led me to found LRN, a company that helps businesses develop ethical corporate cultures: Philosophy is powerful enough to tackle sprawling issues. The discipline remains amazingly practical after existing for more than 2,000 years. Here’s a timely and practical example of how applied philosophy can generate a new business idea: At LRN, we don’t think of our suppliers as “vendors” or our customers as “buyers.” They are all our “partners” in a shared effort to build our businesses together in the service of a big idea — a more ethical corporate sector. This may sound abstract, but it’s actually quite practical. When you share a philosophical concept or a world view, you create alignment, whether it’s with a colleague, a trading partner or another stakeholder. Without that shared vision, relationships often bog down in low-level squabbles. During LRN’s negotiations, for instance, instead of butting heads with our partners across the table over low-level details, we strive to remember that we share common ground and that we are committing to working together for years. If we remember that, we’re more likely to reach a win-win agreement that deepens our connections. LRN is hardly alone. As I wrote in an earlier story , more companies appear eager to deepen connections with their own partners and the human condition in general. I was recently struck by the simplicity of Ally Bank’s print advertisement expressing its competitive advantage: “We Speak Human.” Wanted: Philosophers in pinstripes These corporations are promoting the notion that their mission extends beyond profit and provides new frameworks — transportation, fuel, manufacturing and so forth — for improving existence. These assertions require supporting actions over the long term if they are to have merit. In our connected and transparent world, where so many can easily see deeply into our operations, it has become clear that companies and even nations have character — and that their character is their destiny. For institutions to ensure that their characters, or cultures, are consistent with their behavior, they need more humans within their organizations who can appropriately manifest the desired culture through leadership, business practices and individual behaviors. When LRN posted the job listing for the New York office administrator position that Emily recently stepped into, we included a specification designed to let candidates know that we valued what they might contribute to our company, beyond their administrative skills: “Philosophy major preferred.” We hoped to find someone like Emily, who could truly connect with our mission and not just “do the job.” That qualification seemed a bright idea. It turned out to be a practical idea. Before my September trip to China, philosophy major Emily took the initiative to join a group of staff members who brainstormed with me about ways I might connect international company executives, local business people, students and Chinese citizens on the topic of values, ethics and behaviors. Our office manager and philosopher added value in a way that someone hired exclusively for a skill set probably would not have been able to contribute. Anyone — not only philosophy majors — can think more broadly and more deeply about the beliefs and values at the root of our crises, but Emily certainly does. This is hopeful news at a time when massive problems are nudging people to hunker down, rather than to lean in and connect. These connections are vital as we engage deeper with the 21st century’s biggest challenges. As we do this, we will find that philosophy’s application is not only “killer” in a practical sense, but necessary in a fundamentally human one.

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Dov Seidman: Philosophy Is Back in Business

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By Niklas Magnusson and Jeroen Molenaar Dec. 20 (Bloomberg) — General Motors Co. said it received inquiries from “several parties” for its Saab unit after announcing it would close down the Swedish automaker following the collapse of talks to sell the company. One of the approaches was from Spyker Cars NV , which said today it had submitted a revised bid. It was the failure of negotiations with Spyker last week that led to Detroit-based GM’s decision to wind down Saab. The new offer is valid until 5 p.m. U.S. Eastern Time tomorrow, Spyker said in a statement. “We will evaluate each inquiry,” GM said in an e-mailed statement today, without revealing the identity of the parties that made them. “We will not comment further until these evaluations have been completed.” The fresh Spkyer bid and the other inquiries may revive hopes that Trollhaettan, Sweden-based Saab can continue to produce cars. Some 3,500 jobs at money-losing Saab are at risk, along with thousands of jobs among suppliers to the automotive industry in Sweden. Two attempts to sell the 72-year-old brand have failed over the last month. “An 11-point proposal had been submitted to GM, addressing each of the issues that arose during the due diligence process,” Spyker Chief Executive Officer Victor R. Muller said in the statement. It removes “each of the obstacles that were standing in the way of a swift transaction,” he said. Russian Investor In its original offer for Saab, Spyker was bidding in a partnership with RMC Convers Group, a company owned by Russian businessman Vladimir Antonov , who is the automaker’s largest shareholder with a 29.3 percent stake. Mubadala Development Company, a state-owned Abu Dhabi-based investment company, is also a shareholder of the Dutch maker of $235,000 sports cars. Spyker’s Russian ownership and financial backing was among GM’s concerns with Spyker’s original Saab bid, a person familiar with the company’s thinking said Dec. 18. It wasn’t a single issue that ended the talks, stressed the person, who asked not to be identified because the negotiations were private. Spyker is “convinced we have a chance to rescue Saab,” Muller said in a telephone interview today. Saab is “a viable business on a standalone basis,” the Spyker CEO said. “Since we don’t know why Spyker’s first attempt failed, it’s very difficult to judge whether it will succeed this time,” said Mike Tyndall , an analyst with Nomura Securities in London. GM and Spyker decided there was “no point in carrying on” after encountering issues that couldn’t be resolved, GM Vice President John Smith said on a conference call on Dec. 18. Spyker, Koenigsegg GM started talks with Spyker after a sale to Koenigsegg Group failed last month. That group canceled its planned purchase of Saab, saying delays in closing the acquisition “resulted in risks and uncertainties” that prevented it from implementing a new business plan for the Swedish carmaker. Saab was to become profitable by 2012 with annual sales of at least 100,000 cars, according to Koenigsegg Group’s business plan in September. The European Investment Bank in August delayed a decision on whether to lend Saab 400 million euros ($573 million) to be used for the development of new technology, which it eventually granted Saab on Oct. 21. While the EIB approved the loan to Saab, the bank must re-evaluate the financing with any interested buyer as the new owner before it can be paid out. The transaction with Spyker had to be concluded by the end of this month, GM said before the deal failed. Spyker had said its earlier bid for Saab hinged on the European Investment Bank approving a 400 million-euro ($537 million) loan for the development of new technology by the end of December. Muller said today that in the new offer, approval isn’t needed before Dec. 31. ‘Every Effort’ “We have made every effort to resolve the issues that were preventing the conclusion of this matter and we have asked GM and all other involved parties to seriously consider this offer,” Muller said. “We are very confident that our renewed offer will remove the impasse that was standing in the way of an agreement, and this would still allow us to conclude the deal prior to the expiry of the deadline originally set by GM.” Zeewolde, Netherlands-based Spyker reported a net loss of 25 million euros last year, and Muller said Nov. 20 that Spyker won’t be profitable this year. Lack of cash led Spyker to obtain loans in 2007 from Vilnius, Lithuania-based AB Bankas Snoras in return for a stake of almost 30 percent in Spyker. The automaker divested its unprofitable Formula One racing team in 2007 and sold 12 vehicles in the third quarter. Its C8 Aileron, which accelerates to 60 miles per hour in 4.5 seconds, retails for at least $235,000 excluding taxes in the U.S. To contact the reporters on this story: Niklas Magnusson in Stockholm at nmagnusson1@bloomberg.net Jeroen Molenaar in Amsterdam jmolenaar1@bloomberg.net

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GM Says It Has `Several’ Inquiries About Saab as Spyker Submits New Offer

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Spyker’s Chief Muller Says EIB Is `Biggest Problem’ to Reaching Saab Deal

December 17, 2009

By Ola Kinnander Dec. 17 (Bloomberg) — Spyker Cars NV’s plan to buy General Motors Co.’s Saab unit hinges on the European Investment Bank approving a loan before the end of December, the Dutch luxury-car maker’s chief executive officer said. GM and Spyker are not the “potential problem for this transaction,” Victor Muller said in a phone interview from his home in Amsterdam today, adding that winning EIB support before year-end is the biggest obstacle. So far, the European Union’s lending arm has sent “neutral signals” on approving a 400 million-euro ($574 million) loan that is key to the sale and which the Swedish government must guarantee, said Muller. “It’s mainly now down to the government agencies,” Muller said. “That’s really the main issue. We’re getting lots of support from the Swedish government.” Spyker, the maker of $235,000 sports cars, emerged as the frontrunner to buy Saab this month after Koenigsegg Group abandoned its bid on Nov. 24. GM’s Chief Executive Officer Ed Whitacre said on Dec. 15 that the Detroit-based carmaker will shut the unit if it doesn’t reach a deal with Spyker by the end of this month. GM has separately agreed to sell some technologies for Saab’s 9-3 and 9-5 models to Beijing Automotive Industry Holding Co. The EIB was not immediately available for comment. Koenigsegg Canceled Deal Koenigsegg Group canceled its planned acquisition of Saab, saying it ran out of time because delays in closing the acquisition had “resulted in risks and uncertainties” that prevented it from implementing a new business plan for the Swedish carmaker. The EIB in August delayed a decision on whether to give Saab a loan, which it eventually granted the Trollhaettan, Sweden-based company on Oct. 21. While the EIB approved the loan to Saab, the bank must now re-evaluate the financing with Spyker as the new owner. The Dutch carmaker is using Koenigsegg’s business plan in its bid and plans to keep Saab’s management if it buys Saab, Muller said. “In October, the EIB approved the Koenigsegg deal, which was exactly the same deal — the same lender, same borrower and the same business plan,” Muller said. “The only thing changed is the shareholder, so they have to do due diligence on that.” According to Koenigsegg Group’s plan for Saab as of September, the automaker was to become profitable by 2012 with annual sales of at least 100,000 cars. No Signed Deal No deal will be signed with GM until the EIB has decided on whether Saab can get the loan with Spyker as the new owner, Muller said. Spyker is also waiting for the European Commission to decide whether potential Swedish loan guarantees for the EIB funding distorts competition and for the Swedish state to decide whether it will give Saab the guarantees, said Muller. “There is very little point in signing an agreement until the time that the governmental agencies have approved the transaction,” Muller said. “Everybody knows exactly what the deadline is. There is no misunderstanding about that,” he said adding GM’s chief executive officer had been “blatantly clear” about a Dec. 31 deadline. Saab is likely to win European Commission approval for the EIB loan, Johnny Kjellstroem, who is negotiating the case with the European Union’s regulatory arm on behalf of the Swedish government, said last week. It’s possible that the European Commission will reach a decision this month, he said. The EIB gives funding to projects throughout the European Union and raises funds it then lends on under favorable terms, according to its Web site. Recent projects include funding for energy efficiency and urban regeneration in cities and financial support for small businesses as well loans to the European automotive industry. To contact the reporter on this story: Ola Kinnander in Stockholm at okinnander@bloomberg.net ;

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Diane Goldman, mother and sales executive with New Agency Partners …

November 4, 2009

I then went back into financial services using my business experience as an owner and public accounting experience as an advisor. BN: How did your role as a mother and business women evolve? DG: I never had the opportunity to stop working … If there is no business history, no contracts or committed sales for a new business, an entrepreneur can expect to personally guarantee any loan or credit facility. Also, lenders love to see the business owner’s commitment to the …

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Dan Dorfman: Recession Over? You Gotta Be Kidding!

September 24, 2009

We can all learn from our predecessors, no matter how smart we think they are. Ditto Barack Obama, who enthusiastically declared in a recent national TV address that “the bleeding has stopped.” Too bad, though, he didn’t meet any can ladies (a new business breed) when he came to the Big Apple recently to address the United Nations. He might have enlarged his economic perspective. The president is hardly alone in claiming that things are now stable, although some significant economic facts of life and numerous skeptics suggest such cheerful tidings should be taken with a heavy grain of salt. The skepticism of the President’s economic assertion conjured up a memorable observation from one of Obama’s predecessors, Abraham Lincoln, that I’ve touched on in my past writings. Lincoln’s observation: “Tis better to be thought a fool than to speak and remove all doubt.” I was reminded of Lincoln’s comment as a result of an incident that occurred the other day, one that comes on the heels of one of my recent HuffPost pieces. In it, I commented on one of the unfortunate consequences of the economic turmoil in New York City — namely the demeaning practice of growing numbers of unemployed workers to raise money by rummaging through various garbage disposal areas in search of used soda cans that they could sell to local supermarkets at five cents a can. They’re known as can men. Lo and behold, the hunt for such cans is now turning into a family affair. In recent days, for example, I spotted several women in their 40s and 50s crossing busy Manhattan streets, rolling shopping carts loaded with used soda cans and heading to the supermarkets. They’re called can ladies. Managers at Food Emporium and Gristede’s, two of the city’s largest food chains, both tell me the number of can ladies coming into their stores is sharply on the rise. Some, in fact, using cell phones to alert each other to garbage locations where cans be found, work in teams. This money-raising effort would seem to raise genuine questions about Obama’s declaration that the bleeding has stopped. So, too, would other noteworthy developments. Chief among them: Unemployment, now at 9.7% (15.1 million jobless workers), is widely expected to continue to rise through the first half of 2010. Likewise we all know aging baby boomers who have lost their jobs, many of whom will likely never work again. The argument that housing has hit bottom is becoming increasingly suspect, what with the unsold inventory on the market (about four million homes) projected in some quarters to climb to at least 11 million. Expectations of mounting losses at the nation’s banks, which remain reluctant to lend. The International Monetary Fund pegs additional losses here of about2.7 trillion. Severe financial damage to consumers, who have seen the financial chaos wipe out13 trillion of home and stock values. Accordingly, they’re spending less and saving more. Meanwhile, some skeptics, taking sharp issue with the happy talk from the White House and Ben Bernanke, ridicule the notion that the recession is history. One is Nobel-winning economist Joseph Stiglitz, the former skipper of the World Bank and a professor at Columbia University. Stiglitz recently reiterated his view that “we’ll be lucky to get out of the recession by 2012.” As the good professor sees it, you need GDP growth of 3% to create new jobs and that could be two to three years away. The bottom line: If you really believe the recession is over, dream on. Write Dan Dorfman at Dandordan@aol.com

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