Warren Buffett got me going again. I won't rehash what I wrote last week, though I will throw out a few grins at the notion that I think like Buffett [:-D]. No, instead I want to briefly rant on the snake oil economy that America is allowing our politicians to sell them.
I heard the first intelligent thing I've ever heard from a Tea Party supporter. I know, I know, but even a broken clock is right twice a day. Matt Kibbe of Freedomworks made a seemingly innocuous statement on the July 29th Real time with Bill Maher. To paraphrase, he said that the Tea Party ideology was born out of the middle class's belief that they bear the burden of socializing the bottom class AND the upper class.
Now, again, that seems like a fairly innocuous statement, no? True to form, it was lost very quickly in the show. However, consider our progressive income tax structure and then juxtapose that with the points raised by Buffett and myself about the rich underpaying vs their own workforce as a percent of their income. It suddenly gives Mr. Kibbe's statement some foundation.
This gets me to my point about how our politicians try to present our economy. The old guard wants to harangue about our manufacturing Economy - we used to make shit, then we'd blow people up with that shit for the purpose of selling them other shit to drive our economy. The new wave is the Service Economy - everybody else makes shit, but we're the smartest people on the planet, and therefore they need us to come up with the shit to be made and then provide the service to keep it running at a premium.
They're both a complete load of, well, shit. We sold the Manufacturing Economy up the river a few decades ago. The Service Economy is a Utopian dream that we won't be able to fully achieve. Instead, I'd like to introduce my own concept: the Performance Economy.
This idea is not based on any sort of hard facts, loose statistics, or abstract theories. I've conceived this idea purely my own, solely based on my own professional trials and tribulations. My concept of the Performance Economy is quite simple: The value of our economy is based on what we do.
Way too easy right? Well, let me elaborate on the most important part of my statement, the word "do." See anyone can do anything. That is the very definition of freedom, but that does not necessarily create value. Conversely, creating something that results in value is not entirely what I'm going for either, as it may only be a one-time deliverable. No, my idea bears two key indicators: measurability and successful progression.
Measurability is key to making sure that progress can be accurately tracked. From the assembly line to the board room, anything can be properly framed within metrics that define the value of work being done. Those metrics can then to transitioned and transformed into guidelines by which business can operate. Think of this as the present value of an organization or venture.
Successful Progression determines the future value of an enterprise. Anything can work once. "The Real World" has had dozens of sequels, but none will approach its success. No, the way to grow is to take the metrics of a successful enterprise and evolve them to the next step that drives the next great venture. To build on the "Real World" example, the successful progression is "The Jersey Shore."
To pull the concept away from the MTV artificial universe, consider Apple vs. Microsoft. Apple picked itself up off the mat by embracing their failures, evaluating their metrics, and adapting to a new vision. They made the iPod and it blew up. so they took the framework of the iPod and evolved it to the iPhone. Now they're at the iPad phase. What's next? Who knows, but the point is that they're already on it. Microsoft on the other hand still thinks like a PC. That's not going to work. Microsoft either has to evolve of has to fail. It sucks, but it's a Performance Economy. Either get the job done or get left behind.
Combined, the two indicators create a very simple, yet elegant hypothesis:
Growth = Present Value [Measurability] + Future Value [Successful Progression]
Like all theories, it doesn't always work, but it works more often than not. I'm ready to pick up the ball and run with it. I hope others have the stones to come with me.
Disclaimer: After writing this post, I Googled "Performance Economy" and stumbled upon this book. From the description, it seems like it is at least somewhat in line with my thinking, so at least one other person out there thinks I'm on the right track. I'll get the book and report back on my impressions at later time.
No comments:
Post a Comment