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The end of history or the end of trust?

When Francis Fukuyama wrote ‘The End of History’, he was thinking of a new world order that followed the end of the cold war. One where unrestrained capitalism had prevailed over what we understand as democracy. However, mix capitalism and technology, I commented on a programme earlier this week; at the start of the Andersen trial and you also stimulate the expansion of two separate but connected forces: Globalisation and virtualisation.

Today, business is both everywhere and nowhere simultaneously and concepts of corporate governance, have, in a number of prominent examples, been discarded as irrelevant luxury. Twenty years after the movie ‘Wall Street’, Greed it appears is still good and business degeneracy is on the rise.

If investor credulity and the Dot Com ‘bubble’ defined the end of the 20th century, trust is an early casualty of the 21st century. Trust in governments and trust in institutions, such as Andersen which were once recognised as pillars of professionalism and integrity and now appear to be riddled by conflicts of interest.

Ironically, at a time when technology offers instant accountability over any distance, large, multi-national companies seem less able to exercise authority from the centre. Individuals at distant locations are increasingly capable of ignoring corporate policy and thanks to communications technology, able rashly or intentionally of triggering an international business crisis for a company in a matter of minutes.

When I was in Saudi Arabia last month, the Arab News broke the story that in the heat of international concern over events taking place in West Bank of Israel, the country’s local office had, without any consultation with Redmond, sponsored an advertisement in support of the Israeli army. While the story may not have seen the light of day here, it was front page news in the Middle-east and an immediate public relations disaster for Microsoft in the region.

Theoretically, technology should offer a company tighter control of its decision-making and accountability functions than ever before in human history but quite demonstrably, I doesn’t. Why is this?

My own theory is that the management theories of the eighties and nineties, re-engineering, downsizing, up-shifting and many more, produced post-modern businesses with a single profit-driven purpose. Anything else was ‘streamlined’ and viewed as irrelevant. In simple terms, if like me you have been on the outside, looking in at many of the world’s largest and best-known corporations, then you’ll be aware in almost every case, business is so streamlined and downsized, that management spends much of its time reading e-mail and hoping that all the spinning plates don’t stop at once.

In a flat corporation, nobody really owns the responsibility until, like Barings before or Deloittes or Andersen and Enron today, it’s too late. The technology at our disposal should offer the means of facilitating a wider sense of corporate responsibility and of tightening the governance which is so obviously and frequently failing.
As a global business community, we need to start concentrating a little less frantically on creative management theories that drive profitability and rather more on measures and systems that encourage trust, responsibility and good management. Integrity for a business of any size is a currency that once lost can never be recovered.


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