Author Archives: Catherine Holdsworth
Capitalist leaders are called to account
17 August 2015 by Catherine Holdsworth in Business and finance, Current events, Nine visions of capitalism
Earlier this month, emerging political candidate Bernie Sanders called out the top CEOs in America and asked them to account for their actions. It’s a familiar story, the Fat Cats on Wall Street engage in illegal activity, make exorbitant amounts of money, and then let other people deal with the consequences (if you’ve seen The Wolf of Wall Street, you’ll know what we’re talking about). Why does this matter? We’re all aware that those with the biggest bonuses are not the ones feeling the pinch of the recession that we’re only just recovering from. Well, with Greece still in crisis, the UK threatening to leave the EU, and the American election on the horizon, these are very real issues that we need to grapple with.
In his letter to The Wall Street Journal, Sanders said that the ‘Wall Street leaders whose recklessness and illegal behavior caused this terrible recession are now lecturing the American people on the need for courage to deal with the nation’s finances and deficit crisis.’ In a two-pronged attack on the wealthiest people in America, Sanders published a report that shows how various CEOs and corporations have managed to evade $34.5 billion in tax. These people claim to want to close the deficit but are actively contributing to the problem. If the average person avoids tax, it probably won’t make that much of a difference to the government. However, to reach $34.5 billion in unpaid (or avoided) tax it would require a significant proportion of the population of America just refusing to play by the law. If it was the average man on the street, he’d go to jail. But because the top players on Wall Street maintain so much power, it would seem that they are beyond the law. It is time that we stopped turning a blind eye to this sort of avoidance. The capitalists that determine, by and large, our financial stability, are the ones who should be an example for the benefits of capitalism. America is perhaps the biggest capitalist country in the world, and yet it would appear that, rather than show how capitalism can be beneficial to the economy and help those all the way at the bottom of the pyramid, it is leading the way in demonstrating the worst aspects of capitalism: greed and the misuse of power.
When companies such as Apple, Google and Microsoft are now richer than the US government, one looks to them to set a positive example of how capitalism can benefit not just those who work for the corporations, but the government to whom they pay tax. These are global corporations but they all began in Silicon Valley. They are the very epitome of American capitalism at its best, highlighting how small start ups can become global brands. However, these companies should also be a marker for how all companies in the capitalist food chain can not only be successful, but create wealth and grow the economy. Not all companies will be as successful as these, but even small companies can take lessons from conscious capitalism. Charles Hampden-Turner and Fons Trompenaars in their new book, Nine visions of capitalism suggest that ‘Wealth is created when values are joined by meta-values, when for example workers receive higher wages for being more productive so there is money or value for everyone. Customers provide more revenue that is shared between employees and investors. Wealth is also created when products do not die and go to waste but become a cradle for another product.’
The iPod is an excellent example of a product which has evolved and grown, making way for better and smarter technology while maintaining the integrity of the original. So Apple is leading the way. You only have to look around you and you won’t be far away from an Apple product. This is demonstrative of capitalism being beneficial to the customer as well as the company. There are many people who are loyal to the Apple brand. However, with great wealth comes great responsibility. Apple and its chiefs must demonstrate a conscience in a world that is powered by wealth. Back in June, Taylor Swift called Apple to account when they said the they would not pay artists in the first few months of their music streaming service, ‘We don’t ask you for free iPhones. Please don’t ask us to provide you with our music for no compensation’, she wrote in an open letter to the company. Recognising the backlash that this would cause, Apple quickly did a 180 on their policy and announced that they would pay royalties. Case closed. Nevertheless, Swift proved that large companies are not infallible and that it pays to be seen as a company that is doing good.
Capitalism and the companies that contribute to the growth of wealth are not infallible, but they are incredibly wealthy and powerful. It will take more than Taylor Swift to bring down Wall Street. Yet the conscious capitalism movement is growing and it’s people like Swift and Sanders who have the platform to call those to account who should be doing more to help the economy grow rather than contribute to the deficit. It is incredibly unlikely that the next President of the United States will be the CEO of Coca-Cola or Microsoft, but their influence is not to be ignored. Those with such influence and power should work alongside governments to help find a solution to the economic crisis. Paying taxes will be a drop in the ocean compared to what they stand to lose if the house of cards that these people live in decides to topple.
Conscious consumerism and the distribution of patronage
5 August 2015 by Catherine Holdsworth in Business and finance, Nine visions of capitalism
Capitalism has changed the way we shop, there is no denying it. Where once a high street would be populated with a butcher’s and a baker’s (perhaps too a candle-stick maker?) we now have colossal supermarkets offering everything we need under one roof and for seemingly a better deal than the smaller shops. Capitalism should strike a balance between big companies and smaller ones. Charles Hampden-Turner and Fons Trompenaars’ book Nine visions of capitalism offers some ways in which conscious capitalism, and in turn conscious consumerism can benefit those who really do live on the other side of the world.
It’s true that consumers are coin-operated and you’d be hard-pressed to find many people who would reject a good deal. If you can get the same product at a cheaper rate from a bigger company, then why would you spend the extra money? How much power do consumers really have over capitalist giants such as Amazon, Google and Starbucks? Well quite a lot, it would seem. Sure, one person would have a mighty job trying to bring down a huge company on their own, but in the social media age, where everyone’s a critic, word of mouth and customer service means more to giant companies than you think. Amazon describes itself as the most ‘customer-centric’ company, offering every product you could wish for from the supermarket in the sky. The recent Amazon Prime day, which had more deals then the Generation Game, was brilliant in that it got thousands of people to sign up to the service for the ’30 day free trial’ but then relies on the apathy of the customers not to bother cancelling their subscription. Brilliant. Customers think they’re getting the best deals and Amazon are set to make a huge amount of revenue.
But is cheaper always better? We recently blogged about whether Amazon Prime Day was good for publishers and we understand the value of a good brand. When you see a Starbucks or McDonald’s while backpacking in Timbuktu, there’s a sense of the known and familiar, a comforting feeling that you’re not so far from home and you associate those brands with the everyday. You can be on the other side of the world from your home but there will always be a capitalist giant to remind you that the world is smaller than you think. This logic of the familiarity is easy to transfer to the everyday life. With a Starbucks coffee, you know what you’re going to get. You know that Coca-Cola will taste the same in Austria as it does in Australia and perhaps it is the fear of the unknown that drives consumers to these brands.
However, consider for a moment that you don’t get your morning coffee from Starbucks, but instead from the independent coffee house around the corner. You’re more often than not likely to get better-quality coffee and better customer service. That is not to say that is the way for all independent coffee houses, but if you’re going to compete with giants such as Costa and Starbucks, you’ve got to care about your customers and care about your product. Otherwise, what’s the point? Customer service is valued now more than ever. If you want a book recommendation, Amazon can tell you what other customers who viewed certain items bought, but if you go into a book shop, you can ask for personal recommendations. Booksellers are usually incredibly knowledgeable when it comes to their products, in a way that cannot be substituted by an Amazon algorithm.
The balance of patronage lies in the hands of you, the consumer. We all love the ease with which we can do our weekly shop, or use the ‘one-click’ service online. It’s great when packages fall through our letterboxes and we feel even better knowing that we’ve got a bargain. There is a backlash against large companies and their seemingly untouchable power. Last year a loyal customer of Caffe Nero returned his loyalty card after finding out that the company had been avoiding tax. Integrity goes a long way and these large companies are endangering the positive aspects of capitalism. Perhaps next time you feel like buying the latest best-seller for a ‘better than half price’ deal, consider sharing your patronage with those independent shops. For the extra money you may find you reap the rewards in other ways.
Why immigrants succeed
30 July 2015 by Catherine Holdsworth in Business and finance, Current events, Nine visions of capitalism
No matter where you’ve been in Europe this summer, you can’t help be be aware of the growing problem that immigration is causing on first world countries. Thousands of migrants are making their way from Syria, Libya and Afghanistan, among many other countries, to the UK border in Calais. Crossing the Mediterranean Sea in treacherous conditions to be washed up on the coast of Italy or fished out of the water by the British Navy, European immigration is becoming an increasingly concerning issue.
Earlier this week, a man died while trying to get into the Channel Tunnel and today David Cameron issued a warning to all of those attempting to cross over to Britain every day: you will not find solace or welcome on our shores. Sure, the UK cannot accommodate the thousands of migrants that are hoping to breach its borders, nor can it afford to pay for their healthcare, housing and job-seeking period. However, this issues is now bigger than a UKIP placard. These migrants have risked their lives and left their families behind just for the chance at a life in Britain. Their own governments and countries have failed them. They have nothing to lose.
If you’d read any UKIP propaganda before the 2015 UK general election, you’d have thought that every British citizen was plagued by migrants; that there were 10 immigrants for every British person. This is not the case, nor is immigration bad for the British economy. If we send all the immigrants back to their homelands, do we have to recall all the British who have moved abroad as well?
Charles Hampden-Turner and Fons Trompenaars, authors of Nine visions of capitalism, state that ‘In a land of strangers you are defined by what you do, not where you come from.’ Statistically, immigrants in the UK contribute more to the economy than they take out in benefits, suggesting that they’re willing to to any job if it pays the bills, whereas there are Britons who are rejecting work on the basis of either ‘waiting for something better to come along’ or not wanting to lower themselves to clean toilets, for example. Hampden-Turner and Trompenaars offer a broader evaluation on the effect of migration:
What is it that immigrants have that overcomes the prejudices against them? They have at least two points of view or social contexts, the one they brought with them and that of their adopted land. Too many of us have just one. Immigrants must strive to include their diverse views with our own. It is when cultures collide that we learn – not only about others but about ourselves. Values are differences and immigrants know all about the differences they encounter daily. They can encompass different points of view.
Immigrants are also more likely to be individualistic. They have broken ties and moved away from old attachments, but they are also more likely to be communal, since their economic futures depend upon a network of fellow migrants and maintaining their close support. They are prepared to work harder for less in order to survive. That they better understand other differences between say, sellers and buyers, is not unexpected. We saw that where East meets West in Singapore, Hong Kong, Taiwan, South Korea and Malaysia the economies tend to be strong. These populations have also learned from both sides. Since birth rates have fallen in the affluent West we need educated immigrants to make up for this.
Of course immigrants are not always successful. Some are crippled by prejudice or by culture shock, or bring cultural practices with them that clash with majority values (female genital mutilation, for example). Moving from one culture to another makes you or breaks you and anti-immigrant feeling is easily aroused by the numbers of broken strangers, many in prison, some unemployed, claiming benefits or before the courts. Depending on their social class, indigenous citizens may encounter more losers than winners and generalize from this. Those who are different will not always be included. Tolerance is not enough. We should learn from immigrants.
Lord Sewell proves sticking to your day job is always best
28 July 2015 by Catherine Holdsworth in Business and finance, Current events
It’s almost August and Parliament has recently broken up for the summer. Sadly, David Cameron will not be pointing at fish like he has done every year since winning the election in 2010, but never fear, one politician has gifted us a nice scandal to take us into the summer holidays. Perhaps due to the fact that things were winding down for the summer, Lord Sewell took it upon himself to spice up the news during what the business world would deem, ‘cucumber time’.
This morning Lord Sewell announced his resignation from the House of Lords. Apparently he was a UK representative to Nato, and has run for Parliament several times. But the first time he registered on most of our consciousnesses was when he was caught red (or white) handed snorting cocaine off a prostitute’s breast. Nice work if you can get it, Lord Sewell, was that in your job description?
This latest scandal to rock the British elite has got us very puzzled in the Infinite Ideas office this morning. It’s the sort of wonderment that makes us wonder ‘Is enough never enough?’ Was Lord Sewell not happy with his high-paid job, comfortable living quarters and important social status? (We’re not sure that drug-taking with a sex worker is the best way to boost social reputations but, whatever floats your boat, My Lord.)
We like to find the silver lining in everything and perhaps we can all learn something from Lord Sewell’s blunder (apart from not hooking up with prostitutes and cocaine, a combination guaranteed to get you fired unless you work for a pimp). Though Sewell would have done better to stick to the benches in the House of Lords, it’s never a good idea to mix work and pleasure. It’s all very well to have banter with your boss, but you wouldn’t want him or her to catch you coked up to your eyeballs on a night out now, would you? In the grown-up world of being over twenty-one, it’s perhaps appropriate to act accordingly. We’re not trying to ‘kill your groove’ but perhaps encourage you to take a more positive attitude to work which means you won’t be tempted to resort to the ads in a telephone booth on the weekend.
So while it’s curtains for Lord Sewell’s career, it doesn’t have to be for you. If you get far too drunk at the office summer party and tell all your co-workers about THAT trip to Malia when you were nineteen, you’ll most likely to be the laughing stock of the office. But it is unlikely to get you fired. Unless you committed arson or murder, in which case your colleagues would do well to inform the police. It’s all fine and well to enjoy the social aspect of your job, after all, you spend most of you time there, but be wary of how you come off or you may find yourself out in the cold in need of a prostitute for company.
Infinite Ideas has lots more business tips and a range of books to help you get ahead in the office as well as loads of great summer deals on books. Perhaps Lord Sewell would have done well to heed some of our advice.
Game of Thrones leads Emmy nominations
20 July 2015 by Catherine Holdsworth in Business and finance, Current events, Entertainment, Game of Thrones on Business
On Thursday the 2015 Emmy nomination were announced and Game of Thrones leads the field. Though it’s disheartening to see that Kit Harrington and his lovely hair did not get a nomination, Peter Dinklage, Lena Heady and Emilia Clarke will all be hoping to take home a shiny golden trophy.
When one looks at the nominations on a broader scale, the actors who are up for the big prizes are no longer people who found fame in TV. Maggie Gyllenhaal, Kevin Spacey and Liev Schreiber are all up for acting gongs, and all are big, well-established names in the world of film. What is turning them to TV all of a sudden? When you look at the current situation of the cinema box office, it is filled with sequels, prequels and reboots. It would seem that in the two hours or so that the director has to establish a relationship with the audience, they go for what works rather than something new and innovative.
We love TV now. It’s the viewing equivalent of sitting down with War and Peace or Moby Dick, investing a long time in a fantasy world, building relationships with characters and becoming seriously affected by their outcome (farewell Jon Snow). Televisions series allow for character and plot development in a way that film cannot provide. So, since audiences want familiarity, we have an extremely long film series with characters that we know and love time and time again. Don’t get me wrong, I love a superhero movie as much as any 15 year old boy does, but it doesn’t provide me with as much satisfaction as a ten part Game of Thrones series.
Producers and actors are now wise to the shift to television that audiences are making. With the creation of HBO and Sky and of course, bigger tellys, we are now closer than ever to having the movies in our very own home. It is a radical shift to the Hollywood business model and producers are finally waking up to what the audience wants. How can Hollywood compete with Netflix, a fast streaming service that gives the viewer autonomy (or so they think) to watch whatever they want , whenever and at a reasonable price?
It is unlikely that the Emmys will ever rival the Oscars for prestige and glamour, but it is clear the heavyweight actors, once nominated and winning at the Kodak Theatre are now finding themselves on the other side of the fence. Could giants such as Netflix and Amazon Prime actually reinvent the business model of Hollywood that has remained steadfast for over 100 years? Perhaps it’s too soon to tell, but with countless Emmy nominations to its name, Netflix is all set to ‘break the wheel’, much like our favourite queen, Daenerys Targaryen.
We love business and we love popular culture, what better way to celebrate the Emmy nominations and the build up to the awards by reading Game of Thrones on Business. Netflix, take note!
Is Amazon Prime day good for publishers?
15 July 2015 by Catherine Holdsworth in Book publishing, Business and finance
Today, to mark the twentieth birthday of a small company that you might have heard of, called Amazon, the web retailer is launching its first ever Amazon Prime Day. In order to induce customers to sign up to the £79 a year service, benefits of which include free delivery on purchases and access to Amazon’s TV streaming service, they are being given exclusive offers in a promotion that Amazon claims has ‘more deals than Black Friday’. It all sounds like a pretty sweet deal from Amazon, which claims to be the ‘customer-centric company’.
But what does this all mean for the publishing industry? It may look great from a consumer point of view, with its exclusive free ebooks and highly discounted books (in much the same way that a worm on a hook looks great to a trout). Amazon is pushing the products at customers at prices that are incredibly attractive. But if it looks too good to be true then it might be worth taking time to think about just how Amazon is managing to make these offers. Take, for example, the summer read that everyone’s talking about, The Girl on the Train, which is selling on Amazon for £6, less than half of the RRP (£12.99). The Amazon price is much lower than that of the average paperback book in your local book shop, and no doubt when it is released in paperback, Amazon will reduce it further. How is Amazon making money on this product, and more importantly, how is the publisher?
Well it’s unlikely that Amazon is making much, if any, money on the discounted products. By heavily discounting books like this one and Go Set a Watchman, Amazon is creating loss-leaders that are drawing customers to the site in the hope that they will buy more products that aren’t so heavily discounted. More importantly it’s creating subscribers. The repeat subscription fee (yes, its cancellable but subscription retailers rely on something called inertia – cancelling involves action so only a small percentage will make the effort) and the easy marketing opportunities mean that Amazon can afford to give a few books away for peanuts.
(By the way, ever wonder why books are so ‘expensive’ (the average price for a non-discounted paperback is around £8.99)? There are quite a few parties involved in the creation and selling of a book and all of them need to make money from the deal. So, to name a few there is an author, the publisher, the printer, sales, marketing and distribution. Publishers have to sell books to retailers (such as Amazon) at a discounted price and this is one of the things that makes it possible for Amazon to sell books to customers at high discount. If the RRP of a book is lowered then the returns for the publisher are lessened. As it is books are often priced at a level where publisher margins are small – we’re talking levels that would make the Dragons’ Den investors say ‘I’m out’ right at the start.)
But we digress. The point is that when Amazon discounts greatly it is either not making any money itself or it’s asked the publisher for extra discount as payment for the huge level of publicity garnered through a prominent position in a big Amazon promotion. And don’t forget that Amazon sells many more things other than books. Heavily discounted books draw people in; the hope is that they leave with a more high value item as well. Amazon may not make money on books but as it sells other items it doesn’t have to. That’s not something you can say for your local book shop. Some people on the inside of publishing – publishers and competitor retailers – are unhappy with the pressure Amazon’s pricing puts on the industry. A new app has launched to combat the huge portion of market share that Amazon has, where you can compare their prices to those in your nearest bookshop.
As a small independent publisher, we cannot compete with such a giant. But we value content and we value authors and the time that it has taken us collectively to bring you the best books that we can produce. Perhaps you think that paying £8.99 for a paperback is excessive, but consider those behind the scenes before you rush to see how much Amazon has knocked off.
You might say we are conflicted when it comes to Amazon. We have a working relationship with the site. Given that it is a global brand, our customers are able to buy our books and ebooks through a very effective sales channel and yes, we admit that we use the site as well from time to time to buy books. But perhaps, rather than give all your sales to Amazon, you as a customer have the power to take your patronage elsewhere occasionally. Pop into your local independent bookshop, or visit your local chain. Touch and feel the books; you’re sure to get good advice from the booksellers too if you can’t decide on what to read next. The power is in your hands to redistribute the wealth of the market share. Enjoy your Prime Day deals, tell us whether you think it’s worth waiting for The Girl on the Train to be released in paperback or whether we should join the library waiting list, and when you see a bookshop, think of the publishers and the authors. We love books and value them – we’re not sure the same could be said for Amazon.