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“Men are more accountable for their motives, than for anything else; and primarily, morality consists in the motives, that is in the affections.” – Archibald Alexander
Business 101 starts with defining a business model that solves a real problem for a set of people, and doing so at a price which people will pay to address their need. This business model will account for risks, and a conscious decision is made to pursue the business (or not) based on these risks.
In some cases, the risks are very high and the potential rewards correspondingly high. The most extreme of these are called “bet the company” decisions – and rightfully so, the risks are realized it could destroy the company. The fundamental concept that both extremes are possible serves as an internal regulator for decisions. Extreme risks are taken very carefully and very seldom – often with fingers crossed.
Over the last few months it has become fashionable for companies (and entire industries) who made “bet the company” decisions to not have to live with the consequences of their decisions and actions. Many excuses are being bandied about as to why they should be “bailed out”, but the bottom line is they feel they should be able to reap the tremendous rewards, but not be held accountable when the risks are realized. Unfortunately, our political system enables this thinking if the companies in question employee a very large number of people.
If we remove accountability from the decision making process, there would be little restraint and decisions would be made in a haphard and reckless manner. No risk would be too big if those making the decisions are not held accountable. No reward would be too high with ambition, greed, and plain old human nature would prevail.
At the end of the day, accountability and the risk/reward concept forces people to make better decisions. Better decisions lead to better companies. We cannot abandon this fundamental principle, no matter how large or small the company.
