Leadership – Page 298

What corporations and spleens have in common

In 1886, Santa Clara County sued the Southern Pacific Railroad regarding a tax matter. The case escalated to the U.S. Supreme Court where, in a mystifying aside, Chief Justice Waite commented, “The court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws, applies to these corporations. We are all of opinion that it does.”

More than a century later we continue to suffer from the consequences of this tangential assertion that corporations are, for most legal purposes, people.

A recent Survival Guide, in a discussion of the morality of contracting with offshore providers for IT services, asserted that corporations aren’t moral agents. Quite a few readers disagreed, arguing that because corporations are composed of human beings, they inherit the morality of the individual human beings who own them and are employed by them.

If only it were that simple. But it isn’t. Human beings are composed of cells, tissues and organs. Presumably we each have greater moral responsibilities than our spleens. More generally, organisms have “emergent properties” — characteristics beyond those of their component parts.

Morality is a species-specific trait of Homo sapiens. As a former graduate student in ethology — the study of animal behavior — I can tell you with authority that there isn’t a shred of scientific evidence to suggest that any other species has a moral sense.

Organizations of human beings aren’t just big people. They’re different organisms, with different behavioral drivers. In a sense, they exist in a state of nature, subject only to criminal, civil, and evolutionary laws. The human decision-makers who make decisions on behalf of corporations might be moral beings (although I sometimes have my doubts) but group decisions and decision-making processes are quite different from those of individuals. We’ve seen this time and again in the form of mob behavior, and in the reprehensible behavior of some nations that’s at odds with the fundamental decency of most of their citizens, to give just two examples.

This, in fact, is the fundamental flaw in the Supreme Court decision: Human beings are presumptively moral beings; corporations are presumptively amoral. Our nation’s founders recognized the distinction: According to them the rights of human beings precede and legitimize government, while by definition, the government provides the legal framework that allows corporations to exist.

The rights of human beings precede government; the rights of corporations are defined by it.

Life sure would be easier if businesses operated as moral agents. It would be a refreshing change. But they don’t.

Which brings us to you and your role as a corporate leader. In that role, where you’re acting as the agent of an amoral entity, your moral choices aren’t easily summarized in black-and-white terms. It’s a subject next week’s column will explore in more practical terms.

Moral absolutism has become fashionable these days. It’s common to hear people assert that we all know what’s right and wrong, without question, beyond doubt, and don’t even think about arguing. That’s for moral relativists — muddled thinkers who allow evil to spread because they lack the courage and integrity to fight it. The moral absolutists know better — they can tell right from wrong and good from evil instantly and clearly. They know it in their guts.

Maybe they think our spleens do have a moral sense.

Cottonwood now or hardwood too late?

160 years ago we were a nation of farms and small merchants, in which both people and information traveled no faster than when Julius Caesar overthrew the Roman republic.

A mere 45 years later, the trip from the east coast to California, formerly a half-year ordeal, was a routine two week journey; information traveled coast-to-coast in seconds; and giant corporations were considered persons by the law.

And you thought the Internet transformed the world? Compared to the transcontinental railroad, the agent of these transformational changes, the Internet hasn’t come close.

Take time to read Stephen Ambrose’s Nothing Like It in the World, which chronicles the process through which Abraham Lincoln preserved the union from an east/west division just as surely, if less dramatically, as his leadership of the Civil War preserved it from secession by the southern states.

Whenever you read history you learn something useful about the present. Among the many instances here are foreshadowings of both Enron and a current IT controversy.

The Enron foreshadowing? Both the Union Pacific Railroad and Southern Pacific Railroad companies created separate construction companies. The construction companies, owned by the railroad company board members, siphoned off huge amounts of capital from the railroad companies, enriching their owners while leaving both the employees and other railroad shareholders holding the bag. Sound vaguely familiar?

But that doesn’t directly affect you as a working leader of information technology. This does, as a metaphor for problems you deal with every day:

For the Southern Pacific Railroad, hardwood railroad ties were in short supply. To avoid construction delays, it used cottonwood ties in much of its initial construction instead, even though they would last only a few years. Bad engineering? The company desperately needed cash flow. Had it waited until it could acquire enough of the “right” railroad ties, it would have run out of money before finishing construction.

This philosophy explains a lot of what we’ve experienced with Microsoft operating systems over the years. Time-to-market has usually trumped internal engineering, to the despair of many in our profession. Was this decision wise? The question is, for whom? Certainly, the earlier Microsoft is able to ship product the earlier it makes a profit. What — you thought Microsoft was an altruistic enterprise, putting your best interests ahead of its own? That isn’t how business works. From its perspective, generating revenues earlier was worth the impact on its image with respect to quality.

Sometimes bad engineering is the best engineering — a valuable lesson. An example even closer to home:

Quite a few readers griped about my endorsement of Fire Controlman Derrick Thomas’s homegrown database, which reduced the time needed by the U.S.S. Benfold for each Persian Gulf ship inspection by two and a half hours. Thomas should have worked with an IT professional to build it right, I was told … after all, it was probably an undocumented mess, and who supported the system once he left the ship?

Had Thomas had taken this advice, he’d have waited until the Benfold returned to port, then submitted his request. Had it ever emerged from the priority queue the Benfold would have received the system a year or two later.

It’s cottonwood now or hardwood too late: A fleet of destroyers’ worth of capital and wages, times 2.5 hours per ship inspection, times a few hundred inspections, all spent because end-users shouldn’t build systems by themselves?

The quality of Thomas’s code is unknown. But the quality of his business judgment?

Outstanding.