Fairness

[TexLaw]

Not to get overly academic, but what is "fair"? One tends to see "fair" through one's own lens. In my experience, "fair" isn't much more than that place where you go to ride the ferris wheel and eat corn dogs. As a concept, it's about as amorphous as it can get.

I have made and continue to make a great deal of my living, directly or indirectly, from negotiating deals. Some of those are negotiations are on my own behalf and some are on the behalf of others. Some are on behalf of the supplier, and some are on behalf of the consumer. In any case, when it comes to evaluating the terms of a deal, I don't care about "fair" as much as I care about "reasonable." Of course, "reasonable" isn't much better defined. It's all about . . . well . . . figuring out what works for you under the circumstances. That said, parties usually can get through a roadblock by explaining to each other the reasons for their respective positions and then getting a little creative.

I worry about ethics, as well, but that's all about obeying accepted rules and practices (some written, some not). That's a different sort of "fair," I suppose.

In any case, if you don't think you're being treated "fairly," you gotta get up. Either get up and fight, or get up and leave. If you are treating someone unfairly, you better be ready for them to get up and do something.

 

[FarmerTan]

Wife and I will go a long way to work with a person we like.

It isn't all about cost.


AA

Amen.

 

[Mr. Scruffy]

That being said, there are huge consulting companies that will work on contingency that will improve operations by doing things that will get them their percentage of "improvements" in the short term without consideration of the longer term.

That is why when I meet someone who is currently (or formerly) with McKinsey & Co. I politely find someone else to talk to.

 

[Alacrity59]

That is why when I meet someone who is currently (or formerly) with McKinsey & Co. I politely find someone else to talk to.

The company that hatched Tom Peters? Ah well . . . not everything that shines is a star. I've been involved with a lot of consultants over the years. I've been pleased with many. I've even been happy with several that worked on a contingent basis. Yet some have been absolute disasters.

 

[les24preludes]

when it comes to evaluating the terms of a deal, I don't care about "fair" as much as I care about "reasonable." It's all about figuring out what works for you under the circumstances. That said, parties usually can get through a roadblock by explaining to each other the reasons for their respective positions and then getting a little creative.

Exactly - if the terms of the deal and the explanation for these terms are reasonable then it's possible for both parties to be "satisfied enough" with the outcome, and return business is quite possible. There may even be mutual respect. Many parties have to do business on a regular basis.

The whole point of "honour" which used to be so historically important, is that it worked in small circles of people where loss of reputation could be catastrophic. We've lost a lot of the importance of "honour" in large multicultural societies which are anonymous enough for many to get away with bad practices.

 

[Alacrity59]

One of you cuts it in half and the other one picks which half he wants.

That’s how my father got us to divide stuff when we were kids. We like to think of ourselves as “fair”, but we still tend to skew things in our favour without thinking.

I agree with your dad's way of dividing things.

 

[Alacrity59]

Ethics and fair business practices can matter. A friend of mine is in the lumber-milling business. His company sells lumber (particularly finishing trim) that goes into higher-end homes. There are only a few of these companies in the business in the area he conducts business. One larger builder of homes screwed my friend twice. In both instances, they placed large orders of trim which were delivered. The terms of the orders were 2% in 10 days, net 30. After 45 days the builder paid the invoice after taking a 5% discount.

Word got around and now none of the building supply companies will deliver any building supplies to this builder unless they are paid in advance or on delivery.

Yes that is a brilliant example. I also have no doubt that even with prepayment this company never ever gets a fair deal. Their reputation is set in stone. It is very very hard to recover.

 

[FarmerTan]

Not to get overly academic, but what is "fair"? One tends to see "fair" through one's own lens. In my experience, "fair" isn't much more than that place where you go to ride the ferris wheel and eat corn dogs. As a concept, it's about as amorphous as it can get.

I have made and continue to make a great deal of my living, directly or indirectly, from negotiating deals. Some of those are negotiations are on my own behalf and some are on the behalf of others. Some are on behalf of the supplier, and some are on behalf of the consumer. In any case, when it comes to evaluating the terms of a deal, I don't care about "fair" as much as I care about "reasonable." Of course, "reasonable" isn't much better defined. It's all about . . . well . . . figuring out what works for you under the circumstances. That said, parties usually can get through a roadblock by explaining to each other the reasons for their respective positions and then getting a little creative.

I worry about ethics, as well, but that's all about obeying accepted rules and practices (some written, some not). That's a different sort of "fair," I suppose.

In any case, if you don't think you're being treated "fairly," you gotta get up. Either get up and fight, or get up and leave. If you are treating someone unfairly, you better be ready for them to get up and do something.

I'm kinda slow, so I had to read this twice. Very well stated. As long as someone isn't looking to cheat someone I'm all for calling it a fair deal. I had it easy. Folks could read the sign, and either sit down and get a haircut or not. And come back the next day if I screwed up, but that only happened once. He was about 21 and his mom called to complain. Had him come back, made some noises behind his head and cut nothing. His mom called me back and said how nice it looked. I was always busy every time she called for an appointment for little Lord Fauntleroy after that, amazingly. I still hate privileged primadonnas, even if I can't spell it.

 

[Mr. Scruffy]

The company that hatched Tom Peters?

Do you mean the Tom Peters who made gazillions of dollars from writing the mega best seller "In Search of Excellence" only to admit later that he falsified the underlying data supporting his conclusions in the book?

I like to think of consultants as corporate seagulls. They fly in, crap all over the place, then fly back out.

 

[ackvil]

Do you mean the Tom Peters who made gazillions of dollars from writing the mega best seller "In Search of Excellence" only to admit later that he falsified the underlying data supporting his conclusions in the book?

I like to think of consultants as corporate seagulls. They fly in, crap all over the place, then fly back out.

You are right on, Harry.

One of the companies I worked at hired some consultants to review their business model for a segment of their retail business. A group of young folks fresh out of Harvard Business School and who have never worked for a company arrives on the scene. Six months and over a $1 million later they come up with a number of recommendations. Most of the recommendations were to change the image of the company via a different advertising program and changing the merchandise mix in stores to draw in higher income customers. The result was a sales drop of over 5%. Over a year later there was a change in corporate leadership and the first thing they do is to bring in some new consultants. Their findings: the company lost its identity and they should go back to the advertising and marketing practices they had prior to making the first set of changes.

 

[oc_in_fw]

If I recall correctly you are on the same end of business that I am. I'm fully in agreement with what you just said. I'll add that you will not maximize profit by screwing your suppliers either. For that matter you will not maximize profit by basically screwing anybody.

Walmart does a good job at this. Take Huffy bikes. They were in a bit of trouble, and jumped at the chance of selling bikes at Walmart stores. Soon, Walmart became their sole customer. Then Walmart starts demanding lower and lower prices. Company gets in more trouble trying to keep up with pricing demands. Huffy has to close their plant in Ohio, and Chinese creditors obtain the company in bankruptcy. Now Huffy is no longer an American company. Vulture capitalism.

 

[Doc4]

But...if you're a mega-corporation you may be able to get away with it. Get a monopoly going and people don't have a choice.

 

[oc_in_fw]

Every once and a while they allow a sacrificial lamb to quiet the hoi polloi