Silver Lining In The Financial Crisis

Amidst the financial crisis, some 40,000 of New York’s 185,700 Wall Street jobs could be lost. The bailout is not exactly offering a great deal of confidence to the financial markets. We are all losing a lot of money. Fear runs through the system like a chilling shiver in the middle of the night.

In these turbulent times, it may be a good idea for finance professionals to look at Entrepreneurship as an alternative way of life.

I have long been troubled by the fact that Wall Street absorbs some of the most highly educated talent in America into jobs that do not involve “building” or “leading”. Rather, these professionals spend their lives “trading” – buying and selling equities, for example, in companies that other people have built with their blood, sweat, and heart. And of late, it appears that they have been busy participating in scams mostly.

Let’s look at where this tendency comes from.

Prof. Rakesh Khurana of Harvard Business School has recently written a critique of business schools’ evolution over the past 50 years. In his book, “From Higher Aims to Hired Hands,” he argues that important business schools, including Harvard, have lost track of their original mission to produce far-sighted leaders who can help the economy run better.

Indeed, we have arrived at a point in history when grooming leaders capable of creating, building, and growing sustainable enterprises is no longer the central objective of the nation’s premier academic institutions. Even the enterprises that have been built need to optimize short term profits by short-selling their future.

Cutting R&D is a popular means of delivering on earnings forecasts, a fatal technique especially for companies in the tech world. Business Schools, however, have to teach “techniques” for short-term optimization and financial engineering to keep Wall Street happy.

Furthermore, rather than grooming a “leadership” driven value system, Business Schools today are grooming an “avarice” and “opportunism” driven value system.

The finance and consulting industries are indeed full of people with MBA degrees who have never “done it before” reaping grandiose salaries by moving money from here to there, or by dispensing high level, arm waving “advice” that is hardly actionable or rooted in practicality.

This needs to change, and my hope is that the professionals – especially the younger ones who still have appetite for fundamental change in their outlooks and value systems – who are facing the turbulence of the financial crisis, will look closely at their choices ahead. Do they want to continue in this mode, or do they want to take control of their destinies, build businesses, and follow a more fulfilling, entrepreneurial path?

And to stimulate the exploration of this point of view, I have embarked on writing a book series, Entrepreneur Journeys, Volume One of which is now available from Amazon.

If you know someone on Wall Street who has lost a job, please give them a gift of entrepreneurship. It will provide a much-needed positive thinking that their souls must now be hungering for.