The Naked Corporation 103
| The Naked Corporation | |
| author | Don Tapscott & David Ticoll |
| pages | 348 |
| publisher | Viking Canada |
| rating | 8/10 |
| reviewer | Eli Singer |
| ISBN | 0670043982 |
| summary | A guide to acting ethically in our digitized business world. |
The need for a transparency strategy, as described by Tapscott and Ticoll, is born out of the massive exposure and risk companies open themselves up to when they conceal activities from the public, or live by poor values. As they say:
Customers can evaluate the worth of products and services at levels not possible before. Employees share formerly secret information about corporate strategy, management, and challenges. To collaborate effectively, companies and their business partners have no choice but to share intimate knowledge with one another. Powerful institutional investors today own or manage most wealth, and they are developing x-ray vision. Finally, in a world of instant communications, whistleblowers, inquisitive media, and Googling, citizens and communities routinely put firms under the microscope.
Using basic tools available online, interested parties and activists can discover a companys darkest secrets and publish them to the world - instantly. Transparency theory states that because the corporation risks being stripped naked in ways it cannot control, it needs to be buff. Firms that live by good values (video) do not fear exposure.
Some firms and industries still opt for secrecy in our transparent world and they often end up paying a price for it. That is because when there is little to no visibility into how firms are operating (no transparency), there is very little trust built with customers. Low trust stifles innovation and can instill fear. This in turn creates conflict as companies try to stay closed and stakeholders try to break free.
Some stakeholders community activists, nongovernmental organizations (NGOs), and the like have little or no direct power over the firm. Their main tool is transparency: the ability to learn, inform others, and organize on the basis of what they know. When community stakeholders use information to gain support of others who do have economic power like the firms customers, shareholders, or employees their power multiplies.
One example, referenced repeatedly in the book, is the Linux community. There are so many transparent elements to Linux, from the inspiration behind its conception (an alternative to closed-source software), to the GPL that keeps it open, and the overall integrity of the software and the community that develops it.
Linux's transparent nature is quickly becoming a standard component of the technology industry. In fact, what could be a better endorsement of transparent business practices than IBM shifting its business strategy to embody open values? Big blue has donated millions of dollars of once proprietary code to the open-source community, and hosts massive developer forums that blur the borders between paid developers and the community. This is all done with the objective of making IBM more transparent to its stakeholders.
The Naked Corporation is a fascinating read filled with the ideals that businesses should aspire towards this century. What makes it most enjoyable to read is that Tapscott and Ticoll ground their concepts with real-world case examples, many of them technology related.
The book is divided up neatly into three sections.
The first, The Transparency Imperative, takes three chapters to thoroughly introduce the concept of transparency, and the structure of open enterprises. Most interesting is the first chapter (available free here), which identifies and explores independently the drivers behind transparency economics, technology, demographics (the power of the Net Generation), and sociopolitical changes (the rising global civil foundation). This is a rich and inspiring study, and the authors fuse their findings at the end of the chapter, stating that:
As emerging economy firms and citizens become integrated into the global economy, they will increasingly expect and gain the ability to demand visibility into Western firms business practices Both emerging economy and Western firms will be under increasing pressure to practice what they preach about open trade and level playing fields, as well as to behave responsibly toward people and the environment.
The second section, When Stakeholders Can See, illustrates just how much information employees, partners, customers and communities can discover about a firm. Given that we live in a knowledge economy, companies cannot block information from becoming free. The ultimate exposure of poor business practices is not a question of if anymore, but of when. The whistleblowers at Enron are proof.
Section three, Being Open, teaches companies about the rewards earned by being transparent. Up until this part of the book, transparency was viewed as a defensive strategy. Now transparency is re-introduced as a core source of new value a firm can tap into. Like IBM is doing now, companies can earn massive profits by adopting a more open stance.
In addition to being a great read for managers, I believe this book should be on the reading lists of members of NGOs, activist groups, and socially responsible corporate watchdogs. This is because in outlining the need for businesses to adopt a transparency strategy, Tapscott and Ticoll also create a blueprint for how to expose opaque organizations.
The drawback of this read, quickly obvious to the reader, is that transparency, ethical business practices, and corporate social responsibility are all such new theories that few know how to effectively apply them. Then again, when thinking about the Web in its infancy, talking about the new possibilities was the first step to the future we have now.
You can purchase The Naked Corporation from bn.com. Slashdot welcomes readers' book reviews -- to see your own review here, read the book review guidelines, then visit the submission page.
Hmmmm.. not exactly a new book! (Score:2, Insightful)
Re:Hmmmm.. not exactly a new book! (Score:3, Funny)
waitaminnit... did you use the web to uncover a questionable business practice (advert masquerading as news content) on behalf of viking canada?
case made!
Nor exactly one that bn.com has in stock either. (Score:2)
Guess I'll go to my local used bookshops and see what I can find.
Re:Nor exactly one that bn.com has in stock either (Score:3, Funny)
> table. In fact, first search the carts of 3 for $1
> books and the 'Free' bin that are usually right
> outside the front doors of most used book stores.
And if that doesn't work, check out the public washroom next to the used bookstore.
Re:Hmmmm.. not exactly a new book! (Score:2)
A: Don't sell us our culture!
B: Don't buy it!
Re:Hmmmm.. not exactly a new book! (Score:1, Funny)
Good things... (Score:4, Interesting)
Re:Good things... (Score:5, Insightful)
The management is appointed by the board, which represent the shareholders. Thing is, stocks don't work the way they used to, when people would hold their stock and get rich off the dividends. Today people aren't investing for stock dividends. They buy in the hopes of selling them for more. So the business has to keep growing and keep that stock price up to keep everyone happy.
The problem is, if the shareholders have down-to-the-minute information on everything the board is doing, things get short-sighted. Every single decision the board does would be cause for speculation on the stock.
This, in turn, could make it difficult for the managment to do their job, namely run the company, because any decision which could means lower stock prices, even in the short run, is going to get them into some heavy criticism from the unhappy and increasingly short-sighted investors.
In the worst case, you'd risk ending up with management looking only at what's good for the next day and not what's good for the next decade.
(Of course, it's already a lot like this. I'm just saying it might get worse.)
Re:Good things... (Score:1)
Whups. In the above paragraph I meant to write 'management' where it says 'board'.
Re:Good things... (Score:1)
Re:Buff (Score:1)
Seems a little fixated (Score:3, Interesting)
Section three, Being Open, teaches companies about the rewards earned by being transparent. Up until this part of the book, transparency was viewed as a defensive strategy. Now transparency is re-introduced as a core source of new value a firm can tap into. Like IBM is doing now, companies can earn massive profits by adopting a more open stance.
IBM may be earning 'massive profits'. So is Microsoft. And Microsoft is not being that open. Therefore, I think we should be a little cautious about seeing this causal relationship between 'open' and 'profit.' Perhaps this will emerge into two dueling schools of thought - the open vs. closed, and time will tell which prevails, but certainly the success of 'The Naked Corporation' is by no means guaranteed. Interesting review, however.
Re:Seems a little fixated (Score:2)
Re:Seems a little fixated (Score:2)
PS2 was released before XBOX. PS2 sold to people who had a PS. Xbox came out, some ps2 owners bought it, most did not because they already owned a good console. Most PS2 owners will not purchase an xbox. Halo2 is not available on ps2, and SA is not available on PS2. Most people will not purchase an Xbox and Halo2 ($200 additional dollars) if they already own a PS2.
I own both SA and Halo2, they are apples and oranges. SA is for th
Re:Seems a little fixated (Score:1)
The Cluetrain Manifesto (Score:5, Informative)
Re:The Cluetrain Manifesto (Score:4, Funny)
Now the author will change his tune and lambast the internet because it allowed somebody to not only beat him to the idea, but render his book useless.
It is similar to the irony in how the 'net allowed access to cheaper geeks in the 3rd world, rendering the 'net's pioneers' skills too expensive to be viable.
Suggestion for his next book title: How the 'Net is fucking everybody, including me.
Our President called it: (Score:1, Offtopic)
Cluetrain Manifesto (Score:1)
buff (Score:2, Funny)
When I first read this I thought it said "...when a corporation is naked, it is best to be in the buff." To which I thought, "Well, you don't have much of a choice, do you?"
It's a two-way street (Score:5, Insightful)
Which makes it sound like activists, NGOs, and other entities (like local PTAs, homeowners associations, and the like) are somehow not impacted by the same issues. Entities like the Nature Conservancy sometimes get caught with their financial pants down in odd real estate dealings, and all sorts of non-profits (the United Way, among others) have seen huge problems because of their opaqueness.
The drawback of this read, quickly obvious to the reader, is that transparency, ethical business practices, and corporate social responsibility are all such new theories that few know how to effectively apply them
Actually, the thing that's quickly obvious, here, is that the authors/posters/editors involved in what I'm reading here think that there's never been such a thing as a decent company of more than 10 people, or that running an ethical business is somehow a new invention of the anti-corporate camp, which they've strong-armed onto an unwilling business sector.
Our economy is powered by thousands and thousands of businesses. Hard work, dilligence, and giving a damn about customers and investors is far and away the custom - no matter how much capitalism's philosophical opponents like to trot out the recurring handful of idiot CEOs and boards that smell otherwise.
Where's the rag-tag group of watchdogs watching the crazed HOAs and litigous NIMBYs that actually make more of a direct impact on most people's day to day lives? Those groups are more manipulative, and conduct their decision making in far more nefarious ways than most companies trying to keep their customers, employees, and investors loyal.
Re:It's a two-way street (Score:2)
http://www.activistcash.com/ [activistcash.com]
If wish to check things out from a slightly "leftwing" bias, you might check out "SourceWatch" (formerly "Disinfopedia"):
http://www.sourcewatch.org/ [sourcewatch.org]
You might also want to check out general resources like "Wikipedia":
http://en.wikipedia.org [wikipedia.org]
Re:It's a two-way street (Score:2)
You'll notice that while I'm responding to the clearly left-leaning orientation of the post and the referenced material, that doesn't mean I'm leaving the nutty right-wingers off the hook.
My main point is that, reading the post, you'd get the impression that only businesses, and not NGOs or other entities lack transparency. I've found quite the opposite to be true. While businesses will cite their concerns about remaining competitive (and thus continu
Re:nothing to see here (Score:2)
Re:It's a two-way street (Score:2)
Publicly traded corporations have legal obligations towards transparency and disclosure. Since non-profits don't have investors, they have the right to keep their records private just like any individual does. Private corporations may voluntarily offer some level of openness to combat potential PR problems, but non-profits are generally beholden
Re:It's a two-way street (Score:3, Interesting)
Boy oh boy, if that were more than only occasionally true. I happen to consult (IT stuff, web stuff) in the DC area. Everyone assumes that the only thing in town are giant corporate defense contractors, but believe me: it's non-profits that litter the Beltway. Every conceivable trade association, think-tank, and activist organization on every part of the political spectrum.
Looks good... (Score:1)
*phew*
Full Disclosure doesn't apply for workers (Score:4, Insightful)
The widest canyon capitalism has is the rules are all one way. Submit salary history with resume? How about submit salary history of potential team members so you can make an informed decision?
I find it interesting that most pro-capitalism libertarians, like the authors are all about access to imformation for the investor and other corporations, but not for the workers.
Re:Full Disclosure doesn't apply for workers (Score:2)
Wise folk ignore this request, thus maintaining parity with ones potential employer/oppressor.
Re:Full Disclosure doesn't apply for workers (Score:3, Insightful)
As a pro-capitalism libertarian, I would have to say that this is not the attitude as well. There are two important points missed by your statement.
The first missed point is that the employment transaction is private. Bob's wages are not disclosed because Bob's wages are private to Bob and his employer. But don't let that discou
I agree that wages should be disclosed (Score:2)
It would be an odd change. But it would prevent abuses in a company with some employees making far more than others just because they "know" the right people. It would probably lead to a much more equitible salary for everyone, and shift extra pay into higher bonues for highly performning people.
I've actually never understood what the big deal is with people within a company knowing what each other makes - companies guard
Re:Full Disclosure doesn't apply for workers (Score:3, Insightful)
Simplest response is "Like your company, my previous employers consider that information confidential."
Re:Full Disclosure doesn't apply for workers (Score:1)
Re:Full Disclosure doesn't apply for workers (Score:1)
"Salary? $100,000.00, but I tripled that in our stock last year...."
All that does is give them incentive to cheat (Score:1)
The only solution I see is requiring management keep a minimum percentage of family net worth in the company stock. Make that number bigger then the salary so they can actually lose money in a bad year.
Re:All that does is give them incentive to cheat (Score:1)
As a side note, pin all raises to the lowest-paid employees in absolute terms: If the clerks only get $.10 per hour, the bosses only get $.10 per hour. 5% of minimum wage won't come close to 5% of $200,000+ per year. I bet th
Same trend for those in power everywhere (Score:5, Interesting)
THe Net is returning us to a type of tribal, village society, one where everyone knows everyone else's business. In that kind of society, the powerful have less leverage when it comes to propaganda and knowledge. In that kind of society, they can only rely on force.
As America has become atomized, it has isolated us from the urban, unionized neighborhoods of the Northeast and midwest, and the grange halls of the great plains. Our political information now comes from the mass media, i.e., CorpGovMedia, meaning it is as much disinformation and propaganda as anything else.
But the net does not suffer bullshit or propaganda gladly, and instead skewers it on innumerable web forums (you're soaking in it now!).
Once broadband becomes cheap, look for America to become more like Sweden or Denmark--more united against the rich and powerful....
Re:Same trend for those in power everywhere (Score:2)
On the contrary. The Internet doesn't discriminate against anything. I can post the most nonsensical, baldfaced lie in the world, and the Internet gives it the same weight as everything else.
It really amazes me that you can use the Internet enough to discover Slashdot and not know that the overwhelming majority of the Internet is the babbling of depraved lunatics.
Re:Same trend for those in power everywhere (Score:2)
Or the gross generalizations of people who consider themselves smarter than everyone else and don't need to back up their inane pronouncements with anything like facts. I am sure it keeps you warm at night "knowing" you are sane and everyone else is crazy.
As someone who hopes to become both rich and powerful someday, I hope that doesn't happen. Fortunately, as most Americans at least share my ambitions, I doubt it will happ
Re:Same trend for those in power everywhere (Score:2)
That's such a good summary that it's sig material. I think that the pervasive fantasy you identified is more than enough to account for many American cognitive failures.
I recall talking with an old neighbor just a few years ago. She fondly recalled the old days, when you couldn't hear people shoveling their snow since they used
Re:Same trend for those in power everywhere (Score:3, Insightful)
Right. If you go back long enough before the internet, that's all you had. Whether or not the rich people existed (what, some lords and ladies with rotten teeth, living if they were lucky until their 35th birthday?), their standard of living was nothing compared to what we have now. We didn't get where we are because we were united against rich people. We got here largely on the coat tails of the sort of hard work and risk taking that does,
Re:Same trend for those in power everywhere (Score:2)
Smile! It's not you.
Re:Same trend for those in power everywhere (Score:1)
When people have access to more information it doesn't automatically mean they are more capable of judging sources for what they are. A lot of people probably wouldn't 'dive' in the internet to really get the facts, most of them are quite content to trust sources they already know, that tell them things they're familiar with.
"Stakeholders" dont' make the quick money (Score:4, Insightful)
And those decision makers didn't care about the future of the companies, they just wanted to extract enough money out of them to buy their judgement-proof giant houses in Texas or Florida.
So the issue isn't that well-run corporations should be voluntarily transparent, they already are well-run. The issue should be how to force evil corporations, run by thieving robber barons, into some level of transparency before they've emptied the cookie jar.
paul
Blogs (Score:4, Informative)
-Colin [colingregorypalmer.net]
Trust (Score:3, Interesting)
I'd like to see more openness... (Score:2)
- the UN
- SCO (and their parent, the Canopy Group)
- Microsoft
- Congress
Re:I'd like to see more openness... (Score:2)
What I'd Like to See (Score:4, Interesting)
Don't get me wrong, I'm as anti-big-brother as the next person, but in a society where privacy cannot be garunteed, the next best thing is to have as much as public as possible. Therefore the things that get entered into records would be done under the understanding that anyone could log in and check up on it instantly.
Examples:
You're trying to unionize your workplace and your boss finds out about it. They want to fire you by citing other reasons (attendance issues or something trivial). Any person in the world could check the data and see that you had an outstanding personnel record and that the firing is totally inconsistant with past relations to the company, making it obvious that they were firing you for union activities (firing for that reason is illegal) and they know that.
The company wants to make shoes in Indonesia for a total material and labor cost of $20/pair and sell them in the USA for $120/pair. The consideration of this would be documented and available online (the internal cost analysis report, for instance). Any fool could see that this a profiteering rip-off. Consequences: shoes get cheaper or anti-sweatshop activists lobby the company to keep production local (and union!).
Corporate execs like would have to document all decisions and so forth on the system so there is a big incentive for them to not make shady deals (or at least disguise them better).
I guess what I'm getting at is that transparency builds trust, but it has to be TOTAL and there needs to be some sort of expected standard of corporate transparency, not like the blackboxes they are today. It would be like a public ISO 9000 test. No more non-disclosure agreements!
I hope I live to see it happen, but I suspect that corporations themselves will go extinct before they adopt such structures.
Re:What I'd Like to See (Score:2)
Re:What I'd Like to See (Score:2)
Since we cannot guarantee privacy, we should just eliminate it? So you want your coworkers to know how much money you make, know your medical history, have an exact account of when you take your breaks, how long your lunch is, etc. Oh look Joe from accounting takes 2 hour lunch breaks he doesn't deserve more money than me. Excep
Transparency and Social Security (Score:2)
Deeper levels of transparency are even more important if Social Security private accounts are invested heavily in stocks. Enron-like corporate scandals would have dire consequences with no safety net.
Re:Transparency and Social Security (Score:1)
Re:Transparency and Social Security (Score:2)
Individual securities are risky; the market itself, over time, is not.
Just because... (Score:1)
If people are willing ignore (or even applaud) the general atrocities and exploitation that underlie a given corporation, that company can afford to be "public" about everything it is doing and contiue unobstructed.
Re:Just because... (Score:2)
And the flipside is that if you go out and pick flowers, to give to people, some yahoo is going to scream loud and wide that you're rapeing and pillaging our precious national resources, and attempting to buy public support.
Ewwww. (Score:1, Funny)
Democracy 2.0 (Score:1)
Irrelevant manager-speak, anyone? (Score:2)
The web is stripping away the layers of insulation between companies and the public by giving everyday people access to massive amounts of information. Increasingly companies are finding themselves like the emperor naked and exposed.
Sounds like Harvey Mackay having a wet dream. Cripes.
Slashdot: News for Managers, stuff that maximizes synergy.
Naked and exposed... (Score:2, Funny)
Do not and I repeat DO NOT imagine Steve Ballmer naked and exposed.
...
Too late.
This trend began in 1933... (Score:1)
US Public Companies are the most transparent (Score:4, Interesting)
If you want to really know about a company's practices, read the management footnotes as well as the full income statements and balance sheets in the 10-Ks and 10-Qs. Don't just look at their pro forma earnings statement. Obviously you won't catch outright fraud, but there are plenty of clues that something shady is going on.
I think that people's demand for corporate transparency is inversely related to the money the corporation is making them. Accounting scandals usually happen just after a bust, rarely during a boom. While the returns are attractive, investors simply won't ask questions.
but there's a catch... (Score:3, Insightful)
Re:but there's a catch... (Score:3, Insightful)
The beauty of accounting is that it follows the second law of thermodynamics: it all has to balance in the end. You can neither create nor destroy value. It either comes in from somewhere outside the system under study, or it leaves the system under study to go into another system. Eventually, it all boils down to shareholder equity measuring the ne
Not Always Good (Score:3, Interesting)
Like, when the 800 lb gorilla is viewing your business.
A recent Frontline piece about Walmart included quotes from suppliers getting squeezed by the retailing giant to the effect of
I don't immediately see why a company can't provide a friendly exterior interface without giving away the family jewels. Maybe it just takes too much work, or else customers asking for super detailed technical specifications turn out to be competitors looking for instructions on how to eat your lunch?
Open accounts (Score:2)
But dare not try it myself...
New levels of access to information (Score:1)
The worst part of the whole deal is that people really believe that they have a new depth of vision via the web, so they put much more stock in what they read on the internet then they ever would have otherwise. Farewell, critical thought. If it's on the internet, it must be true.
Outing Corporate Political Influence (Score:3, Informative)
Going Private is as big as Going Public (Score:4, Informative)
As on who sat in on analyst calls in a public company, and tracked the stock price, I know there is huge gap between an understanding of the public, the market, company insiders and company employees. Due diligence is no joke, and communicating what's going on in a company is an extraordinarily difficult matter. Just publishing stuff on the web doesn't cut it. If so, nobody would have lost money in the Bubble. Raise your hand if you really know how to daytrade or read a 10Q.
Private equity firms are on the rise. [bizjournals.com] Everything is not for public consumption. Given what happens to people roasted in the media, what would you rather do? Be public and open to false ridicule, or concentrate on your business?
"Naked Corporations" (Score:1)
A friend of a friend opened a restaurant with a novel pricing structure. It goes like this: Each day, there is one entree on the menu. She's a good and highly dedicated chef, so it's always good, depending upon individual taste. There is no price marked on the menu. You eat and then pay her what you think it's worth. Pretty weird, huh?
You know what' even weirder? She's making money.
This is a lot of garbage (Score:1)
What they did was screamed from the rooftops.
It made zero difference.
You get transparency into the corporationss? So what! Its all lies anyway.
This is a load of road apples. Enough so that I don't intend to even read TFA.