Yesterday we launched our latest report, The New Business Psyche, at a breakfast salon to discuss whether greed and risk could ever be anything but negative attributes in the business world. And after months of preparation, we also announced the rebirth of our agency as Epoch – a new and improved evolution of the precocious five-year-old Clarke Mulder Purdie.
The New Business Psyche looks at risk and innovation after the recession. We recruited David Smith, economics editor of the Sunday Times, Professor Peter Cochrane, former CTO of BT, and Stefan Stern, management columnist, Financial Times, to discuss the issue with our salon guests.
The issue seems to be that a certain type of greed – the greed that can be synonymous with ambition and competition – can be good. Unfortunately, as Stefan pointed out, while this kind of greed creates wealth for an economy, there is no de facto limit stating how much wealth is ‘enough’. It is unbridled greed that causes excessive risk-taking. David brought up the term groupthink to describe bank behaviour before the recession: so busy mimicking the greedy behaviour of others that ‘no-one noticed that the emperor had no clothes’. The danger, he posed, was that groupthink could now swing the business psyche to the other extreme, leading to excessive caution.
David, Peter and Stefan’s talks all converged on one main point: excessive greed not only damages the financial services sector, it also damages the UK‘s investment in start-up companies. In America’s Silicon Valley Peter pointed out that investors are happy to take a long-term approach to investment, and consequently get their reward in due course. In the UK, investors are so risk-averse, or too greedy for immediate gratification, to provide any long-term investment. This is consequently crippling UK innovation. Investors have a heightened sense of risk and inflated ideas of reward.
Just as Dickens’ Mrs Jellyby views her world through a ‘philanthropic telescope’ (and consequently neglects her own children), so are we now distorting our view of business in a recession: risk is magnified beyond proportion and we are neglecting opportunities on our own doorstep in consequence. All three speakers emphasised the nascent potential of new industries such as biotechnology or clean energy production, which, if given suitable investment and backing, could propel the UK back into the international spotlight.
If you’d like to see our live tweeting from yesterday’s salon, please check out our Twitter account or if you’d like to see the questions that were posed, please try our LinkedIn group.