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Posted March. 04, 2006 03:02,   


Advocates of capitalism firmly believe that what is good for the company is good for management. But is it true?

The demise of Chrysler in 1979 may have been an obvious conclusion. After all, they were producing huge automobiles at a time when the price of gasoline had peaked, and while Germany and Japan were churning out smaller-scale car models.

Chrysler obviously had to halt production of those oversized cars. But it was a decision that would mean at least five years of losses. It also would result in a plunge in its share price and structural changes leading to the firing of thousands of workers.

The board of directors finally decided to postpone the decision. “A company our size is not open to experiments, and should not be swayed by trends,” some said.

Chrysler’s directors were following the “Law of the Typical 50-ish Male.”

Men in their 50s were the decision makers for Chrysler back then. They were not thinking about the company’s future 10 years from then. They were already facing retirement. Were they going to let the next generation of management reap the fruits of their sacrifice? That was definitely not what they had in mind. They may have been contemplating Louis XV’s quote, “Après moi, le deluge.” (after me, the flood).

The book “Der Kleine Machiavelli,” published in 2001, is about powerful men in the business world. Looking through the lens of Machiavelli, who pierced through the muddy waters of medieval politics, the book offers a bird’s eye view of the nature of conglomerates and high-level businessmen. By discussing the mysterious upper echelons of corporate society, the author unveils the undertakings at the ‘top of the ladder’ in the most minute detail.

What thoughts do influential managers possess and what laws do they obey? How do they acquire and hold onto power in the corporate society? The book provides the daily occurrences on the anonymous but true stories of German corporate figures.

A legal scholar specializing in Machiavelli, the author calls the typical manager in his 50s as an “old rat.”

Old rats are incompetent and unproductive, but they are drunk with their own power. Power games are their element. Old rats form solid “buddy circles” and guard themselves against the intrusion of foreign figures. The rise of the creative “fancy bird” or the charismatic “dark wolf” is immediately eliminated.

The long-term domination of the old rats is strongly abetted by corporate consultants or headhunters. Mutual cooperation leads to an endless succession of similar old rats, and those that have outlived their usefulness are passed on only to be recycled at another company.

The author is caustic. He explains that, “the power struggle at the frontlines of management is so strange that an approach to the truth inevitably leads to satire.” Then he slyly hints at forbidden survival tips for the corporate figures who are bogged down in the struggle for survival.

He recommends drawing upon external experts and using their assessments; etching one’s position in a company through crisis simulations that are in fashion today; and approaching moving to another company with caution just as one would start a new love relationship.

Then he surreptitiously leans into the reader’s ear to whisper, “When in trouble, the company looks for a sacrificial lamb. Do not be on that list. In-house alliances are a must, while external links are safety nets. Don’t stand out to save a floundering company. If you want to snag a rival just pretend to care about his health or personal life. When criticized, bombard them with showy statistical figures.”

Gi-U Lee keywoo@donga.com