Responsibility for the profit and loss of a business operating unit is a step-up in a management career that presents a new realm of ethics that many managers aren’t prepared to evaluate. This is why so many managers wind up exploiting their teams and/or their customers without ever having intended to become an exploitative profiteer.
Middle management is all about being a people and work product manager. Within a budget set for you from above, you can be involved in hiring, incentivizing and developing direct reports to deliver on their tasks. You are given a degree of accountability for the work produced by yourself and the team that you oversee, and perhaps some added compensation for success.
Graduating to Profit and Loss management suddenly puts the budget in your hands. Sometimes this is a solo responsibility, but often, managers find themselves as part of a group that works together to decide how to generate profit and manage costs.
It’s at this point in their career that each manager needs to decide if they will draw a line between pursuing profit from mutually beneficial exchange and pursuing profit from exploitative advantage seeking.
Unfortunately, many people arrive in their management roles with a belief that business allows a different, more aggressive and exploitative set of ethics than those they believe they hold as a person outside of work.
Behind this rationalization are ideas like “it’s just business” or “corporate is a game you play”. There’s a cultural idea that business is all about personal profit seeking first and foremost; that as you rise in the ranks, the job becomes more about “looking out for number one”. This all gives people a sense of permission to go along with strategies that they know are designed to exploit as much gain as possible from the people on the other side of the table, while smiling to convince (gaslight) those people on the other side that it’s really for their benefit.
In the marketing and ad agency world, this approach toward employees and clients is most prominent in the over assignment of work.
Agencies still base their business models around hours billed, but they can no longer increase billing rates annually the way they’d like (and sometimes cut rates to win or retain business).
So with rates flat, the trick to squeeze a little profit growth out of that hour-based revenue is to increase the hours billed without increasing costs. The only way to do this is to pile more hours on the people who are already there. Staff may start to see themselves allocated to two or three accounts, and may reach 150% to 200% allocation (implying they’re working 16 hour days).
Obviously, managers of these people will know this is not really sustainable. So they will rationalize that their teams aren’t actually expected to work at that level, it’s just for presentation to the client. This rationalization claims non-exploitation of the staff by exploitation of the client (who gets half of the team they’re told they have).
But then things get busy on the client — they have an expectation that requires their whole team. Now the manager is called into action to exploit the team into working as much as is necessary to cover their work on all their accounts.
Managers in agencies will rationalize this exploitation away with the “generational trauma” argument; it was this way for them when they started, and “it’s just the way it is”. The more guilt-oriented managers may also co-dependently throw themselves into the work to alleviate some of the pressure on their team. But at the end of the day, staying on to manage in this environment means choosing to accept and support that exploitation is necessary for profit.
There are other exploitative tactics that become natural to many managers. One is making promises during a sales process based on what the prospect wants to hear without knowing it can be delivered, and perhaps generating some fiction to “sell the dream”. This exploits clients who sign-up to receive something that was overpromised, and exploits teams who are left to figure out how to deliver on the promise.
Another is seeking to exploit supply vendors and subcontracting organizations. These people who are clearly necessary to deliver something the agency can’t (or they wouldn’t be engaged) are still a cost that should be squeezed even harder than employees if it helps the agency’s profits. The “my job is to protect our profit” mentality — when viewed without an ethical line that won’t be crossed — leads to bully behavior by agencies that strings vendors along on discounted (or free) spec work on promises of a future payout that never comes, and that sees the terms of contracts that are signed as non-binding and always renegotiable in the favor of the agency
Again, these are just regular people like you and me. They probably see who they are and what they are asked to do at work as involving a different set of ethics than those they bring to engaging with their families, friends and neighbors, when they think they return to their “real” self. “It’s just business”, you know?
The issue is they arrived in a role that gives them importance in their work, and that rewards them financially when things go as the business wants them to go. So they decide that what is good for the business is good for them. This makes it possible to rationalize these explorations as normal, or of only minor harm to the exploited, as something everyone should expect and therefore condone by engaging with them, because they’d probably do it too if they had the chance.
Suspension of ethics because “Eat or be eaten”. Survival of the fittest”. “Just business”. “I saw it on Mad Men or Succession”.
It seems like the adult thing. It seems like fulfilling the cultural norm of being a hard nosed business person and doing what it takes. But it’s really signing up to join a system of generational trauma, codependency and a lack of role models in ethical management that justifies exploitation of outsiders for the benefit of insiders.
It’s not what business has to be. Profit is possible to generate around mutually beneficial creation of value. But to do that you have to value yourself, you have to value others in ALL your exchanges, and you have to have something of real value to exchange. Sadly, that’s missing in a lot of what’s being sold these days.