Up, Up, Up by Al Sikes

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Revenue surged at Amazon, up 43%, at Facebook, 50% and at Google’s parent Alphabet, 73%.

Good news? Well certainly for stockholders but what about the rest of America. What about Easton and Chestertown and the rest of the Eastern Shore of Maryland?

While I don’t often quote from my book, Culture Leads Leaders Follow; these headlines took me back to my beginning in business and to a chapter called Free Markets.

“The visuals were just as important as the words. My introduction to business remains vivid and timeless. In those early years, I cleaned up and then clerked in my grandparents’ hardware store. It followed the small-town pattern of carrying way more than hardware and was on Front Street in Sikeston, Missouri; population 12,000.

The store’s most distinctive characteristic was a large glass front. My grandparents, Leah and Alfred Sikes and then later their two sons, John and Kendall (my father), were often on the first floor helping customers. In the jargon of today, their business was transparent to their customers.

There was also an unusual gathering spot in the store. Most of the customers built and fixed things and carried pocketknives. There was a horseshoe counter around the stairs that led to the store’s basement and on the counter were sharpening stones. Men would pause to sharpen their knives and exchange the latest stories and opinions—social media, circa the 1940s and ’50s.

Their customers didn’t need to navigate a bureaucracy or call an 800 number to offer their opinion or criticism about merchandise or service. The owners were available and approachable. Business success turned on their customers’ satisfaction and, as my Dad would often say, “being a part of the community.”

Two generations after clerking in the family business, I arrived in New York City to create a new business, in a new technology, on a big stage. As Dad noted at the time, “Son, you are in tall cotton.” Tall cotton means a rich harvest. But having picked cotton, I knew that walking on your knees through the rows of cotton plants obstructs vision. You could see the next plant, but little else.

In some ways, global business is not much different. As I learned in New York City and other citadels of commerce, customer relationships are represented by a stream of data. Our demographic profile, daily buying patterns, viewing habits and social media engagement comprise our profile. Profit-center executives track these profiles and translate them into supply and demand detail and findings.

While a cotton picker could not see much beyond the next cotton plant, executives choose not to see much beyond their data sheets. I worry less about the loss of privacy—today’s primary focus—than about the loss of humanity. What happens when a culture is abstracted by data by those who feel no cultural responsibility?

The CEO routine in New York is to walk out the door of an apartment building or a home in the suburbs and into a company car with a driver. Often, overnight files of new customer sales data await the CEO as he travels to the office building, gets on an elevator and rides to, let’s say, the 46nd floor.

The 46nd Floor C Suite, which houses a company’s executive leadership, is an important symbol. Its occupants have arrived. Their business acumen rewards them with luxurious offices, spacious boardrooms, and elegant private dining. This is most often on top of seven-figure or eight-figure salaries plus stock or option grants. In 2013, CEO pay for the top 200 companies averaged $20.7 million consisting of $6.8 million in cash and the rest in stocks and options.

Granddad had an office as well. When he left the merchandise floor, he retreated to a small space adjacent to the stock room, where inventory was stored. In community retailing, there were no “Chateau Generals,” as George Marshall called World War II generals who spent their time at headquarters.

Okay, I know sentimentalism is often blind. The world of my grandparents had its robber barons, and retailing is different than making and distributing things. But, and this is the central point, fewer and fewer of the people who command banking or media or manufacturing or service industries have any connection to the actual customer. The customer’s life is largely an abstraction, a data profile, continuously updated by optical scanners and online purchasing. There is nothing wrong with following supply and demand data unless nothing else is followed.

How many retail bankers who initiated zero down-payment home loans knew the newly minted debtors? And of course, none of the investment bankers who securitized the loans knew them. Their obtuseness, along with government guarantees, helped tank the economy and the well-being of millions who saw the value of their most important asset dramatically reduced. Home values in all but the most prosperous zip codes fell precipitously.

The customer’s family is another piece of data summarized by demographers, surveyors, and untold numbers of commercial sociologists. When that data also reveals the social pathologies of a society shaped by consumerism, it is all too inviting to retreat to the 46th floor and read trade journals that highlight the wonders of your industry.”

We should do our part to help preserve our community. Our community includes its merchants. And after family, neighbors are the first to help.

Al Sikes is the former Chair of the Federal Communications Commission under George H.W. Bush. Al recently published Culture Leads Leaders Follow published by Koehler Books. 

Letters to Editor

  1. beverley martin says:

    Thank you! Your insightful, authentic candidness was most appreciated!

  2. Amy Haines says:

    Well articulated, Al! The soul of America is in the midst of an identity crisis. The hope rests in our ability to arrive at the realization that we, as human beings are the most important asset of any organization. We are most successful when we demostrate empathy, humility and the importance of connection to each other. When corporations decide to approach their missives holistically , their metrics will inot be limited to numbers related to the bottom line. Perhaps their definition of bottom line will be redefined to include the strength and health of their relationships with their community and as a result they become better stewards of humanity.

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