Wednesday 11 August 2010

Hunt in a Pack like Hyenas and Come Away Laughing

Eighteenth century (Meiji period) Japanese entrepreneurs were able to compete with major western heavyweights by evolving a ‘super hunting pack’ called the Zaibatsu which means quite literally plutocracy or rule by the wealthy. During the 19th Century powerful family companies organised themselves into a horizontal monopoly. Any individual or company wishing to enter into a market place had to be approved by the Zaibatsu. After WWII America, military occupiers of the defeated nation of Japan, banned these organisations in a bid to curb the powers of the ruling elite. As a result of the cold war and a desire to keep Japan from succumbing to soviet influence, the Americans loosened their, post WWII, controls and Zubaitsus were allowed to evolve this time into the Keiretsu, which literally means “series”. This allowed the pack to reform but as vertically structured corporations controlling market share by deployment of subsidiaries. It allowed Japanese companies to compete favourably in global trade wars.

American gangster Lucky Luciano formed a predatory pack by turning erratic groups of competing cut throat ‘families’ into an efficient cohesive business organisation. He saw great opportunity in his local changing environment and made clear to all competing factions that if they “…are ready to join forces….” he could stabilise the overall business making it less volatile and more profitable.

John D Rockefeller formed one of the greatest packs in history – Standard Oil. Rockefeller, enormously generous with those who wanted in, was ruthless with those who wanted go it alone. Those who did not join his trust were punished severely by being forced out of business. Standard Oil would employ tactics such as dropping prices and force the target out of business. Those who joined were given valuable stock and salaries among other things.

Rockefeller’s most famed alliance with Henry Flagler instrumental in Rockefeller’s great success. Flagler would go on to help build much of modern Florida. It was Flagler who introduced John D Rockefeller to the idea of a Standard Oil trust to be precise the creation a super pack. Flagler was the introducer of Rockefeller to Samuel Andrews. Andrews was a refinery specialist who ‘dragged’ Rockefeller in the oil business kicking and screaming. William Avery Rockefeller, John D’s brother had his own independent career and became very successful. He was also brought into the Andrews’ refinery pack.

The team they built was incorporated as the Standard Oil Company in 1869. Standard held about 10% of the oil business at the time of its formation. John D Rockefeller was the alpha male of the alpha males. He never sat at the head of the table during the Trust’s meetings. Emotionally intelligent, he knew that managing egos was important. So sitting among the alpha males in the boardroom discouraged envy and decent.

Consequently, a single lioness on the beat patrolling the pride’s territory, can allow free riders in the group to sprawl about lazing in the afternoon sun. If this pattern were to persist the group would eventually perish. Greed may be good for the individual but in a complex society such as the large neocortex human, one man cannot cover all bases all the time when pursuing large game. “Selfishness beats altruism within groups. Altruistic groups beat selfish groups. Everything else is commentary” Wilson and Wilson quote from The Quarterly Review of Biology: To take down big game you have to work in an altruistic and reciprocal pack.

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