Compassion – Why It Is The Ultimate Business Skill

By Julian Burke in Success on January 27th, 2010 / One Comment

Compassion is an altruistic human emotion, allowing those with it the ability to feel another person’s suffering as if it was their own. This does not mean self-sacrificial tendencies must follow but that greater good will come from an important human emotion born from natural, social experiences.

Unfortunately, business culture more often than not fails to see it this way. A business decision in modern society generally means a decision made for the greater good of the company but at the expense of the community. These decisions are short-sighted and do not always give the company a competitive edge.

Bhopal – A Profit-Driven Blunder:
Bhopal, India used to be the home of a Union Carbide facility holding toxic chemicals but profit-seeking opportunists ruined the reputation of Union Carbide and is in turn, hurting the brand name of Dow Chemical, the company that bought Union Carbide. In 1984, a tank of methyl isocyanate leaked into the air and gassed almost four thousand people within the town of Bhopal.

Over two thousand people became permanently disabled, and extremely high cancer rates are suffered from the town’s residents. Women from that town now have a high chance of birthing children with life-altering birth defects, and can’t find husbands to marry them. This entire town had a shadow of grief and hardship cast over it for what was later discovered as cost-cutting measures.

Operators in the plant were not given proper training or manuals in their native language. Maintenance was severely cut to save money as well, allowing machinery to become old and dilapidated. Staff was cut back to such a degree by the time of the incident, that barely enough people were in the facility to keep it running, let alone pass safety standards in most industrialized nations.

By 1984, the isocyanate tank alarms did not work, the flare tower was out of service, and every safety measure to stop the gas from escaping the facility was no longer working properly or disconnected.

Since that incident, Union Carbide was evil in the eyes of the Indians in and around the town of Bhopal and many others who have heard of the incident. The company payed the town 470 USD in settling its criminal and civil liabilities, but that still was not enough to treat those in the town. The people of Bhopal are still looking for funds to treat their illnesses from the incident and the town itself still has residue from the gas leak.

Union Carbide failed to first properly maintain their facilities because of a lack of concern for the townspeople, and afterward, they failed to properly compensate the town. The CEO at the time, Warren Anderson, has been charged with homicide by the Indian government since then and the name of Union Carbide has been destroyed because of this.

After Dow Chemical bought Union Carbide, the people of Bhopal, humanitarians, and environmentalists have criticized the company for not spending the money and picking up where Union Carbide failed. The company hasn’t done anything yet and its image has suffered greatly from it. In this case, the company’s image was ruined because of unsympathetic business decisions.

Henry Ford’s Good Example:
From the first days of Ford Motor Company, Henry Ford was an innovator and a good business man. He had talent and knew how to make the company progress without taking advantage of workers and his neighborhood.

Starting with the $5-per-day program in 1914, Henry Ford started paying his workers more to decrease the amount of turnover and in doing so, keep skilled workers that cared about their jobs. Though scoffed at by other industrialists, Ford believed that if his workers made enough to be proud of their work and buy Ford cars, he would still gain a profit.

He was correct and soon enough, his idea of good wages spread throughout the industry. This idea may be dying out in modern times, the argument has to be made that this mentality gave Ford Motor Company a strong following among those that worked in the company.

Customers react positively to good corporations. Google’s informal slogan “don’t be evil” has not only given the company a good name with customers, but it may have also helped with the company’s success. If a customer can choose between two companies that produce a similar good or service, the customer is more likely to buy from the company with the best reputation.

It can be seen with fans of automotive companies. Entire families may only buy one specific brand of car for life, not even realizing that a different brand they find to be worthless is owned by the same company.

This has happened with General Motors and Daewoo. Most American consumers fail to realize that certain elements of the cars they drive are even influenced by a foreign car, but the feeling that they are driving a model of craftsmanship built by a company that values workers’ rights makes them blind to areas in which their cars fall short of expectations.

A good name can really go a long way. Humanitarian efforts within business will encourage potential customers to become faithful customers even if prices are higher because their consciences feel slightly better working with people who share their beliefs.

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One Response to “Compassion – Why It Is The Ultimate Business Skill”

  1. Hugh DeBurgh - The Passionate Warrior Says:

    Hi Julian – Thanks for the great article!

    At least in a sense, businesses are “machines” that crank out whatever you ask of them. Yet these machines are also invested with human beings, and can also effect the people and environment around them.

    Traditionally, businesses were designed to produce one thing – profits for the shareholders. In more recent years, larger businesses seem to be designed to generate profits primarily for management. Either way, the focus is on financial profit.

    But it is impossible to isolate most business activity from the environment it takes place in. And some of that activity can have profound effects on those people unlucky enough to be nearby when things go bad.

    What we are talking about here is whether the concept that businesses can operate without a “social conscious”, purely for the pursuit of profit, is, or ever was, a legitimate approach to business.

    We are also talking about whether we, as occasional participants in the business world (as stockholders in our 401(k) for example) want more than just profits from those who manage “our” companies.

    The Bhopal incident was a terrible example of what happens when those who make decisions within a business fail to understand (or care) what effect that their activity has on the world around it.

    Of course, it turns out that the decisions made in Bhopal not only hurt many people, but they were disastrous for the company, Union Carbide, as well. So it could be said that the pursuit of profit in a world that has a social conscious requires that management have such a conscious too.

    It’s a fascinating and frightening subject. The real issue is, what do we want from the businesses that we own? And how do we hold them to those standards? And are “we” the actual owners of the business, or are “we” the community itself (via laws, etc.).

    Thanks so much for a fantastic and thought-provoking piece.

    All the best,

    Hugh

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