Michael Porter: Business can be good at solving social problems

The profit motive can make business good at solving social problems says Harvard professor Michael Porter – So how about #terrorism?

From a 2003 proposal for economic development for the Tatars of Crimea.

The paper argues for a targetted financial strategy for a peaceful community, the equivalent in finance to a smart bomb deployed after violence has broken out:

“There is no requirement in capitalism for the direction in which profits will go. They can accumulate in the hands of a few people, and they can be made available to meet social needs. Using profit to meet social needs does not necessarily remove the profit motive because everyone involved in such an enterprise is likely to want it to be profitable so that they will continue to have a job and income. This has been the case many times in US companies, for example. A company may have an economic downturn and lose money instead of making profit. Employees often accept lower pay to keep their jobs and to keep the company going. Employees know very well that the company must once again make a profit – end up with more money than it requires to operate it each year – if they are to keep their jobs. Otherwise, it will consume more money than is needed to operate and finally cease to exist when all of its money is gone. Employees accepting lower pay is a way to help return the company to profitability. The employees all share the profit motive. The profit motive is not the exclusive domain of the few people who start a company. It is shared by everyone involved because each has his or her own self-interest in keeping the company going. “

“In efforts to deal with communities in or near poverty, it will be useful to target progressive, peace-oriented communities just as aggressively as has been done in targeting terrorist cells. Both types of communities are quite similar, but, one has attempted a peaceful path whereas the other has not. Toward this end, the most promising and deserving communities must be “hit” with equal force as is brought to terrorist cells – the difference being delivery of resources rather than ordinance. The point is to grow the best, most promising communities with the same focus and passion brought to destroying terrorists.”

“Just as the US now heavily uses smart bombs in warfare, it is becoming increasingly apparent that the equivalent is needed in aid efforts. It is not enough to spend, say, US$ 7 million dollars for five Tomahawk cruise missiles and then spend a fraction of that amount in building a peaceful community which does not merit targeting by missiles. Yet, that is what we have in this case.”



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