People Over Profit

“Don’t be evil” – a mantra more businesses should consider to avoid losing their way and drifting away from their values.

1. The Lifecycle of Companies: From Babe to Deceiver

Companies don’t start off corrupt but evolve through predictable phases that can lead them astray. The lifecycle begins with honesty, transitions to efficiency, often devolves into deception, and, in fortunate cases, arrives at redemption. This cyclical nature explains why no company is forever good or bad.

Companies like McDonald’s exemplify this process. Initially, McDonald's focused on quality, service, and cleanliness, which drove its success. Over time, though, the push for efficiency overtook these values. By prioritizing fast, cheap food, McDonald’s saw a decline in product quality and faced public backlash for unhealthy menus.

Deception often intensifies as businesses grow. For example, Ford retained a risky product—the Pinto—in the 1970s to avoid the cost of recalls. This decision, focused on avoiding expenses, tarnished the company’s integrity and reputation.

Examples

• McDonald’s early slogan was “Quality, Service, Cleanliness, and Value.” Today, they struggle to reclaim trust in their product’s health and quality.
• After introducing the defective Ford Pinto, Ford chose cheaper settlements over safety recalls, which harmed their reputation deeply.
• Many Silicon Valley companies remain in the “honest era,” offering free meals and perks to employees to maintain morale.

2. The Honest Era: People Over Profit

When businesses are just starting, they succeed by putting people first—employees, customers, and partners. This phase of honesty prioritizes value and connection over profits, building strong, reliable reputations.

Henry Ford was an early pioneer of this mindset in 1903, offering employees fair wages, safety protections, and reduced work hours. The respect for workers not only made Ford stand out but set new standards for other businesses.

Silicon Valley companies today also model this. By offering organic food, wellness programs, and communal workspaces, tech startups cultivate environments that encourage creativity and loyalty.

Examples

• Ford Motors introduced fair wages and a 40-hour work week, unheard of in its day.
• Companies like Google offer wellness programs, demonstrating concern for employees’ physical and mental health.
• Patagonia supports eco-friendly practices, reflecting its dedication to people and the planet from its inception.

3. The Slide into Efficiency

When businesses prioritize efficiency, they unintentionally jeopardize the values that helped them grow. Striving to beat competition with productivity metrics, they risk losing sight of their original purpose: providing value to their customers.

Agriculture is a good example. The push for efficiency through growth enhancers and genetic modifications initially boosted production but resulted in long-term issues with food safety and health risks.

Ford’s later years mirrored this pattern. While they championed productivity innovations, their relentless focus on profits led to product decisions, like the Pinto, that risked consumers’ safety.

Examples

• Growth boosters in farming increased yields but created significant health hazards for consumers.
• Ford’s shift in priorities compromised their early emphasis on safety and quality.
• Fast food chains developed pre-packaged menus for speed but at the cost of nutritious, quality meals.

4. The Era of Deception

Corporate deception takes root when financial gains become the ultimate goal. In this phase, companies hide flaws, mislead consumers through advertising, or exploit vulnerable communities and resources.

In the 1970s, Ford’s leadership chose profit over integrity with the Pinto scandal. Similar trends can be seen in industries that rely on misleading marketing or unethical factory standards.

But the rise of transparency and activism today means businesses can no longer get away with such practices forever. Eventually, customers force accountability.

Examples

• Ford’s Pinto scandal showed a prioritization of legal settlements over customer safety.
• Tobacco companies promoted their products with false health claims for decades, heavily damaging public health.
• Some fashion brands rely on child labor in silent exploitations that are coming to light thanks to global awareness campaigns.

5. Redemption: Making Amends

When companies realize their mistakes and face public backlash, they often move toward atonement. This can mean replacing leadership and radically improving policies to regain public trust.

Ford began addressing its wrongs in the 1990s through higher quality standards and consumer engagement. Toyota’s admission of a life-threatening product flaw in 2010, followed by a direct apology, showed how taking responsibility fosters goodwill.

While redemption doesn’t guarantee immediate forgiveness, it’s often the first step in regaining credibility and customer loyalty.

Examples

• Toyota apologized publicly for design flaws that caused brake failures, regaining consumer trust over time.
• BP adopted clearer safety measures after its infamous oil spills, although long-term trust recovery takes longer with environmental scandals.
• Johnson & Johnson emerged stronger after their open handling of the 1980s Tylenol cyanide scares.

6. The Vital Importance of Transparency

Embracing transparency creates trust. When businesses openly share their flaws and progress, they empower customers to believe in them again.

Timberland stands as a clear example. Its initiative to improve factory conditions and share progress openly on their website demonstrates how honesty pays off.

The internet makes secrecy nearly impossible. Consumers have access to vast information and feel greater loyalty when businesses make earnest efforts to improve.

Examples

• Timberland built a website to document workplace improvements, inviting public accountability.
• Apple invested in strict privacy policies, responding directly to users’ increasing concerns over data security.
• The clothing industry’s “Fair Trade” certification systems stand as commitment flags for ethically sourcing materials.

7. Authenticity Beats Manufactured Image

Authenticity resonates more than marketing gimmicks. Customers can sense when brands are genuine, and staying true to your roots ensures trust and long-term loyalty.

Baileys, for instance, sticks proudly to Irish ingredients and production methods, using “Irishness” as part of their branding.

Companies like TOMS and Warby Parker have created authentic identities by linking their customers’ purchases to larger global impact—a welcomed change in the eyes of modern, value-driven consumers.

Examples

• Baileys maintains their brand identity by producing only within Ireland and prioritizing authentic ingredients.
• TOMS offers one-for-one giving, embodying the generosity at the heart of their branding.
• Warby Parker connects customers to stories through charitable eyewear donations.

8. Customers Want Quality, Not Just Promises

Quality creates trust and communicates that the consumer’s satisfaction matters most, even if it comes at a higher cost. Businesses should prioritize thoughtful, well-made products instead of shortcuts.

Apple continually invests in design and interface quality because they know consumer trust depends on consistent performance. Similarly, quality elevates emotions; Sensory experiences, like Apple stores’ ambient design, transform shopping into satisfaction.

Examples

• Apple’s intuitive product designs echo their customer-first mentality.
• Quality store designs like Calvin Klein’s cement relationships through brand immersion.
• Amazon’s efficient packaging highlights care for customer experience.

9. Fear is the Enemy of Honesty

To stay honest, businesses need courage—admitting errors openly and pushing through fear of judgment. This prevents stagnation and lets companies retain and regain loyalty.

Tim Cook directly addressed Apple Maps’ failings, showing how transparency in failure can appeal even when results aren’t guaranteed. Fear of innovation stagnates companies, while bold moves keep them thriving long-term.

Examples

• Apple faced its Maps failure head-on with a letter from CEO Tim Cook.
• Netflix’s risky investment in streaming highlighted their focus on evolving for the customer.
• Lego learned the importance of change by reinventing products during slow sales periods.

Takeaways

1. Support businesses that are transparent about their methods and values by researching their practices and making deliberate purchases.
2. As a business, listen closely to customer feedback and respond visibly, using it as a tool for improvement rather than dismissal.
3. Stay courageous and admit mistakes when they arise, showing your dedication to doing the right thing.