Strategic Management Chapter 1 analysis
Woke, Inc. Intro & Ch1.
By: Brock Webber & Omar Algburi
About the Author & Intro:
Vivek Ramaswamy:
Harvard Graduate.
Joined a hedge fund and became the youngest partner.
Went to Yale to study law.
Entrepreneur
Studied and experienced businesses in America.
Vocal about the “darkness” surrounding Corporate America.
Goldman Rule
Stakeholder Capitalism
What is “The Goldman Rule”? Exploring “The Goldman Rule” within Woke, Inc. by Vivek Ramaswamy.
Goldman Rule: “He who has the gold makes the rules.”
Vivek as an intern at Goldman Sachs.
“Not just market rules, but moral rules” (pg. 18).
They make business judgments rather than moral/ethical judgments.
Companies make diversity decisions to satisfy social values to help protect their brand.
Money is the driving force in decision-making rather than what is best for the people.
Business owners and CEOs make public claims on societal issues, ruining democracy because consumers or employees must follow.
Vivek Ramaswamy’s Perspective
“When companies use their market power to make moral rules, they effectively prevent those who other citizens from having the same say in our democracy.” (pg. 19)
Vivek believes stakeholder capitalism destroys our democracy.
Companies that make political claims or stances, affect the democracy of their employees who disagree with the companies’ stances. Employees are not willing to use their free speech for fear of losing their jobs.
Executives should think morally and how their actions or words could affect others before making decisions.
Executives make political or moral claims when they do not practice the same.
Central Arguments
Stakeholder Capitalism has turned that businesses such as CEOs believe they must act on social issues.
CEOs have become more worried about addressing social issues than the greater good of the people (pg. 24).
Corporations make claims that take away the voice of their employees.
Elites shouldn’t make decisions.
Executives create responses or strategies in an attempt to fix social or climate issues with a separate motivation behind it that benefits themselves.
Real-World Applications
Coca-Cola implemented a program teaching employees “to be less white.” (pg.18)
Starbucks increased compensation for executives for increasing minority representation within their company.
Starbucks mandating anti-racist employee training.
Nike paid 40 million dollars to black communities.
This was a cover-up to hide employee child labor that they employ for the manufacturing of their products in developing countries.
Amazon pledged to donate 10 million dollars to black communities.
A few months before Amazon fired many black employees who wanted to speak on social media about working conditions.
Broader Implications
Corporations and Executives comment on social issues by showing their support for issues or movements.
Corporations make claims or decisions that CEOs believe are ethical for their business but not all employees or consumers agree with.
Employees do not have free speech because of the risk of losing their jobs.
Supporting social issues is a cover-up for their unethical practices.
Consumers are forced to believe what institutions believe.
Social Justice movements are affected by the corporation’s decisions to support financially.
Evaluating Ramaswamy’s Arguments
Stakeholder Capitalism does affect democracy
There is a line between being a citizen and allowing money to influence decisions.
He provides rebuttals to support his perspective and skillfully lays out the other side's argument.
Because he drew from personal experience, his ideas are credible and well-founded.
Vivek navigates his arguments with a sophisticated knowledge of subjective factors, acknowledging the unavoidability of prejudice.
His position is based mostly on empirical evidence, which presents difficulties for opposing viewpoints.
Facilitating Discussion
Do you agree that the Goldman Rule is present in Corporations today?
Do you agree that are demanded to comment or act on Social Issues?
Does Social Capitalism destroy democracy?
What are ways citizens or employees can speak freely?
Conclusion
The Goldman Rule
CEOs speak or act on political and social issues that can create a false narrative for all stakeholders.
Destroys Democracy
Must find a way to separate capitalism and democracy
CEOs vs citizens.
Expand Your Understanding
“Woke Capitalism – How Corporate Morality is Sabotaging Democracy” by: Carl Rhodes
https://www.heritage.org/progressivism/heritage-explains/woke-corporate-capitalism
https://www.ft.com/content/e4a818e5-4039-46d9-abe0-b703f33d0f9b