The concept is taught at business schools and left there. Soon, executives abandon utility and adopt perception as their guiding metric.
Whenever there’s a massive scandal in the accounting of a large corporation, the first reaction is usually disbelief. We cannot accept that where we believed there was surplus, there is less than nothing. Why is it that we are all so sure, and then so unsure? It’s because humans can create value out of nothing. It is the ultimate act of creativity – and the highest margin possible. The best profits come from thin air. Profits are the only value – right, Mr Friedman?
It’s so damned hard to make money turning rocks into gold, or steel. Once you have scale and complexity, and thanks to the global liberalization of economies, no really big player is in a sector. They’re in the manipulation of perception business. Turning a story into big numbers means you can show profits while the crowd is dazzled. Financial reporting becomes a Weapon of Mass Distraction. Legions of smart people defer their faculties to this mass hallucination of value.
Let’s call it what it is – grooming. Yes, I’m drawing an analogy between a sexual predator and leadership driven by greed. What’s the difference? They gradually condition juniors into transgression, often in such a way that the juniors blame themselves. The only difference is that the corporation is cheered on silently by the faceless, nameless and all-powerful “shareholder”. It’s ironic that banks talk about ethics and annually, they budget to break the banking laws. The fines are cheaper than the opportunity cost.
Shame on us. We co-imagine Steinhoff’s into existence, we suspend disbelief until they have perpetrated stupendous value destruction, and then we all say “how could this be?”. That’s easy, all apes need is enough other apes to buy the story. Once that’s done, mine the fiction for as much as you can get. Just be sure to always tell the other apes how well it’s going. Hopefully, you’ll make it out of the mineshaft before it collapses in on itself because stories can’t hold up the roof forever.
If you look back in history, this pattern has always repeated – over and over again – because no matter how clever we think we are, Sapiens Sapiens is a sucker for a pattern. It doesn’t even have to be real. If it sounds good, we’re all in. Even when it starts to look bad, we’ll invent reasons to keep the story going, because we’d rather back our own predator than see a good story die.
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