As the reader will recall, by "epinicio" we mean a kind of victorious hymn that, originally, pointed to Olympic triumphs in classical Greece. But now, if the reader agrees, we have to place ourselves on the business scene, to talk about epinices that are sung and palinodias that are not sung; to point to complacency, not only about successes achieved, but about future ones.
There are very prosperous companies, without their first executives trying to be pleased in the media; but there are also others that display sumptuous displays of bonanza, perhaps more interested in pretending than in being. There are even daring displays of future achievements, a sort of premature beginning, without, when the time comes, the optimistic forecasts made, nor the corresponding palinodia being sung. What to think of a first executive who announces, in press releases, that he is going to multiply sales by 4 in a couple of years, and then does not even maintain the turnover of previous years?
Certainly, a well-understood enthusiasm is essential in the business world, but excesses of optimism are significant. Perhaps, in some case, it is intended to attract the attention of investors or buyers, beyond nurturing the trust of customers and workers. In his case, the commitment of managers to appear supposes a sensible consumption of attention - limited resources - and therefore of effectiveness after the annual results. If the effort to "appear" were applied to really "be", the effectiveness could perhaps improve: this is what Socrates already called us in his time.
When an executive appears in the media talking about the future of his company, he usually does so with enthusiasm and optimism, and perhaps most of the time he is sincere, although his perception of reality is always limited; but it seems that sometimes sincerity is lacking. In the business world, the belief that people are stupid, or that one is very clever, seems to take root, but it is not easy or advisable to deceive the market. With or without intention to do so - to deceive - there are public statements for the future that seem counterproductive and unnecessary, unless it is about attracting investors, partners or buyers, without ruling out other possibilities.
I will clarify what kind of statements I mean. At one time I have related the case of the Bodegas Vinartis group (with brands such as Cumbres de Gredos, Señorío de los Llanos and others, and chaired by Miguel Canalejo, now president of Redtel), which during 2004 reported, in different economic media, of their plans for the following year: the "landing" in the United States, which they were already preparing; the "landing" in La Rioja, where they would acquire some wineries; the purchase also of some others in Ribera del Duero… Apparently, the company was going to become "one of the best international wineries", because for this - said the CEO - "we have wine and talent." He also provided different values of his ebitda and other financial data at the time, but three years later,the company was being sold at a price slightly higher than half of what was paid for it.
I was certainly surprised by the case of Vinartis (formerly Cosecheros Abastecedores, a company acquired by Nazca Capital in 2003) because what I used to read in the economic press were achievements already materialized by the respective companies, and, if anything, future plans formulated with certain prudence or measure. Within the wine sector, I had also been perceiving what seemed to me to be a singular autotelia of the winemakers, that is, a visible attachment to their activity by itself and even a certain pride in the wines offered. The obsession of Vinartis executives with ebitda was undoubtedly striking, as was Miguel Canalejo's rejection of the existence of designations of origin in the wine sector.
As an example of a sumptuous exhibition by a company in difficulty, I remember the presentation of a Spanish training consultancy in Barcelona, at the Gran Teatro del Liceo, through an event that included an interesting lecture by Eduard Punset and a performance by the String Quartet. That year (2002) the consulting firm, Fycsa-ECG (later incorporated into the Élogos firm), reaped losses of more than one and a half million euros, on a turnover of about six million. The following year, 2003, the company had a turnover of only 20% (a fifth) of what was announced in press releases two years earlier.
The reader will know other examples, but I wanted to refer to this type of exhibition; It would seem that they are part of another economy: that of buying and selling companies, and not so much that of offering products and services to customers and users; that of putting more effort into appearing than being.
Let us now identify some actions that the executives in charge of the mission could undertake, when they had to strengthen the image of their company in the market, in search of investors, partners or buyers. There are, of course, in addition to the bragging of the future and the signs of complacency, other synergistic actions, and together we can point out the following:
- Appear in the media, through advertising, interviews or articles, to show a solid position in the sector Sign numerous alliances with other national and foreign companies or institutions, although later they do not materialize in shared projects Seek awards or recognitions granted by supposedly independent institutions Preaching the magnificent future of their sector, or the excellence of their products and services, insistently Serving on the boards of directors of different associations and institutions that influence the market Exaggerating, perhaps at the risk of arrogance, confidence in themselves and the tone of their allegations and arguments Be present at national and international events (conferences, congresses, exhibitions, etc.) Exhibit sumptuous management liturgies: kick-off meetings,Collective celebrations, presentation events, etc. Publish books, newsletters, brochures, guides, etc., with noisy diffusion among clients and other companies in the sector Take care of accounting documentation and obtain favorable commercial reports that support the solidity exhibited Control the climate work and also do internal marketing to ensure collaboration, conscious or not, of the staff. Inflate the figures for volume of activity and results, and even make optimistic growth forecasts.Control the work environment and also do internal marketing to ensure the collaboration, conscious or not, of the staff. Inflate the figures for the volume of activity and results, and even make optimistic growth forecasts.Control the work environment and also do internal marketing to ensure the collaboration, conscious or not, of the staff. Inflate the figures for the volume of activity and results, and even make optimistic growth forecasts.
These and other practices could contribute to greatly increase the price of the company to potential buyers, provided that they are left to be confused, which is not easy or free. They seem to be related to the cultivation of the intellectual, structural and relational capital of the company, but it remains to be seen its depth, its scope, its solidity, its purpose.
In short, things are not always what they seem and, although this is a truism, it is healthy to remember once in a while. In life, and especially in everyday business life, complexity is the norm and we cannot get carried away by appearances without contrasting them. But it should also be emphasized that, when an entrepreneur wishes to sell the company, he directs his attention to this end, and the corresponding actions do not escape the managers and workers: it is quite possible that the collective effectiveness after the annual objectives suffers; In other words, attention can be sensibly distracted, and distractions do not have good consequences.
Prosperity, and I end these lines thus, is surely better reflected in the income statements, and not so much in burdensome, sumptuous or festive performances in which epinices are sung, or unrealized achievements are boasted; but even if prosperity existed, complacency is discouraged. The strongest companies savor them when they have real successes to savor, but they are not carried away, publicly or privately, by paralyzing complacency.
