The company wanted…
In this blog, as in all business writing, the problem of how to write about a company's actions and intentions leads to shortcut expressions that don't represent the truth.
Let me illustrate with a number of random quotes off the Web, often from business magazines or business sections of newspapers:
- "The company wanted to cross sell products across business unit product lines"
- "What it all comes down to is that Microsoft intends to dominate every market that it contacts."
- "Apple doesn't want music consumers to have freedom of portability."
- "At the simplest level, he says, it is because GE wants to be known as a good company,"
- "Cargill would like to control the trade in food and to make larger profits by buying cheaply from farmers."
- "Looking at this acquisition on the surface, IBM has
always wanted a piece of the retail market."
- "Known for its thriftiness, Disney hates being made to look like a typical money-burning Hollywood studio."
In all of these quotes, companies are presented as having wills of their own. It's a shorthand, of course, pointing at the management at companies cited. We all understand that, or do we?
It is easy to slip from such statements to a personification of companies as beings with intrinsic desires and tastes. In the IBM example above, the use of "always wanted" compounds this, by making it seem like a company has a continued will over time, in spite of changes in management. And people see companies as having human characteristics, such as greedy, aggressive, or friendly.
Much less personification is involved when we write something like "IBM plans" or "Microsoft says", in that these companies do have planning departments or spokespeople. But wanting and hating are human traits, and it's easy to think of big companies as self-willed Titans -- just Google for the phrases "hates God" or "hates America" and you'll find a good number of corporations supposedly bedeviled with these emotions.
(On a side note, the British use of the corporate plural ("BP are", "HSBC seek") comes closer to the mark, implying that there are a group of people involved, not a monolith.)
So forgive me when I use that shortcut with mergers and acquisitions, as I did recently in writing about "why companies want to become massive and dominating and how they are threatened by disruption." It's not the case that companies have wills independent of those of their management, and the "top management of the company" is implied.
But even that is too simplistic. The individuals who make up management of a company have all kinds of motives that are incidental to what corporate goals might be. Self-aggrandizement (vanity), filling pockets (greed), and keeping jobs (fear) are all major motivators.
Furthermore, more often than not, executives are thinking about the next quarter or at the best the next year. Long-range strategy, at least in publicly held firms, is all very well, but it cannot come at too big a short-term price. Chances are that both management and stockholders will be substantially changed over a five-year period. Private equity investors may have the patience to wait three or four years to reap a long-term profit, but even they have their limits. Only tightly held companies can afford a longer timeframe for plans and desires.
I'll try to catch myself from dwelling too on long-term strategy in place of short-term gains. Obviously, all short-term moves have long-term consequences, but most of the applied wishing is from stressed-out executives worried about getting through the next few quarters, not a company building a legacy for itself. The legacy, when it comes, is built on lots of short-term decisions (or non-decisions) by specific people. Companies are not agents, executives are.
