Henry Ford: Ford was not only a genius who modernized the manufacturing process, but he established the principle that, while a business is run for the benefit of the shareholders, the shareholders will ultimately make the most money, if the wealth produced by the business is re-invested in expanding the business and paying the employees a fair and, even generous wage. He paid his employees roughly double what the competition was paying to a simple and straightforward end; he wanted his employees to be able to afford to buy the cars they were producing.
Harris Rosen: Harris Rosen is perhaps the ideal Enlightened Capitalist in that he is perhaps its most efficient practitioner in that he views all his philanthropic initiatives as benefiting the community that includes his employees. His belief is that, if you help the community, you help yourself: “when efforts are combined towards the greater good, everyone will benefit”. The following examples perhaps best illustrate the power of EC.
– Challenge: Improving education in the community
He established day care centers in private homes which also created jobs for the day care employees and offered college scholarships to anyone who graduated from high school in an area of town where many of his employees reside. The result was a dramatic increase in high school graduation, far greater home-life stability, reduced absenteeism and happier, more reliable employees.
– Problem: Lack of qualified employees for the region’s hospitality industry
Rather than scour the country to find the employees he needed, he donated the money to establish the Rosen School of Hospitality next door to his finest resort. The result was that the University of Central Florida has one of the finest schools in the world and he has a steady flow of quality employees for area hospitality businesses including his own.
– Problem: How to maximize employee productivity
Harris has always provided profit sharing to his employees and provided full health care through a brilliantly designed combination of:
- a health clinic/medical center on hotel property
- directly paying for virtually all health care needs
- “bonding” health care costs which exceed a large amount.
The result is the finest employee healthcare program in the industry at a fraction of the cost of the competition’s lower quality healthcare.
Harris Rosen’s most enduring contribution to business is that his “giving” will always be tested as to whether it is effective i.e., has it indeed, made the recipients’ lives better. This market based giving is the most effective giving by far.