Roland Dürre
Monday July 26th, 2010

A Follow-Up on My Presentation – Comments #2 Growth:

In this series, I will comment on the written feedback I received after my presentation. Also, I will answer the online questions asked by students I had no time to amply reply to during said presentation

Lehren für Unternehmensführer – das Leben, das Wissen, die Informatik und die Ethik

(Lessons For Managing Directors – Life, Knowledge, Computer Science and Ethics)

„Innovative Entrepreneurs“ / Summer Semester 2010
Leadership in growth-oriented enterprises

Another item of feedback I consider rather important was

“The speaker states that growth as a business goal should not have top priority. That is a contradiction to what we learn.”

I absolutely stick by this, both intuitively and rationally:

Intuitively

Is it really necessary that we earn more and more and accumulate more and more money?

Take, for instance, our income:
Wouldn’t it be better if the income fit the life cycle? How about earning more when you are young and therefore need the money, for instance for starting a family? To make up for it, why not earn less when your career is almost over, perhaps even your achievement gets less, but you also need less (grown up children, mortgage paid)?

Isn’t it more natural and realistic to have ups and downs where income is concerned, as well, instead of one raise after the other for 40 years? Every year, from the day you graduated from university at 25 to the day you retire at more than 65?

Incidentally, I do not know a single freelancer who enjoyed a yearly raise through several decades. The graphic representation of incomes in this group looks more like a flight curve, occasionally interspersed with landings. Sometimes it even looks like a roller coaster.

The same is true for enterprises.

Why do enterprises always have to grow more and more and get more and more powerful? Why can’t an enterprise also occasionally slim down in order to, perhaps, manage the necessary change? To be sure, everybody agrees that the number of employees should be reduced, yet the turnover and profit are supposed to increase. Doesn’t this sound perverse?

For example, if you own a hotel, do you really need a second hotel, or even an entire chain of hotels? Do you always have to grow in quantity? Can’t you grow in quality and zest for life, instead?

Maybe it is very simple:    
It is not possible to just breathe in all the time. The lung would burst. It is absolutely necessary to breathe out at regular intervals, both for humans, enterprises and the economy as a whole.

Rationally

In order to measure growth, I will first have to give a clear definition of the term and introduce a reasonable metric system. Martin Lees and the Club of Rome, for example, created a new, integral definition for the gross national product. If we followed this definition, we would have a totally different growth development to what has been calculated conventionally. Incidentally, the growth would have turned negative a long time ago. On the other hand, it would be possible for us to enjoy our personal, economical, cultural and social life with drastically reduced waste of resources – which would also be a sort of growth.

I often get the impression that demanding “more growth” is just as empty a formula as the blind call for “more freedom”. If I demand growth, I should at least know the definition of such, instead of being taken in by an antiquated formula!

Here are three examples:
When I was young, the Deutsche Bundesbahn was a key industry. If the number of tons moved on the tracks increased (most of it was coal), we had growth. Later, the Deutsche Bundesbahn was replaced by the construction business. The more houses we built, the more growth we had. During the dotcom bubbler time, the advert business of the media was seen as economical indicator. The more adverts, the better the economic situation.

What an absurdity!

RMD
(Translated by EG)

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