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Machiavelli and Modern American Business Culture

October 4, 2010

Is it better to be feared than loved? If you are the owner of a Fortune 500 company (or any major corporation for that matter) the answer is most certainly, yes.  While reading “The Prince” I came to find myself relating the writings of Machiavelli more to business practice than to politics. For politics, Machiavelli is still totally relevant, however, for business practice, he is giving sound advice that will take a manager or business owner straight to the top.

How is Machiavelli related to American business culture? Well, let’s think about it. How many company owners got anywhere by being nice and trying to be generous to all their employees. Perhaps there are few, but close to none. In business, the end result, or the bottom line, justifies the means. For instance, to have a glorious end in the business world, owners will sometimes have to do nasty things like mass layoffs, pay cuts, etc. These nasty moves will then result in the greater good of the company. These moves are not done for short term gain, but for the long term benefit of the establishment. Being so, the earlier moves made by the company might be frowned upon, but overall deemed as acceptable because they did what they had to do.

If it is figured that the end justifies the means, one must next ask if a company owner should be more interested in being feared or loved?  In the perfect world it would be very nice to be loved, but the reality is that employees will take advantage of the employer who is too gracious. The employer should instill a certain level of fear in the employee so that he will work most efficiently. An employee who simply “likes” or “loves” the employer will easily be turned, should something negative happen to him relating to the company. On the other hand, if something negative happens to the employee who already fears his employer, he will not only continually fear the employer, but perhaps work even harder than he did previously.

To sum it up, two of the key points of Machiavelli’s “The Prince” coincide with proper business practice:

  1. The end justifies the means, if it is for a greater glory.
  2. It is better to be feared than loved.

Businesses did not hold the same kind of power in Machiavelli’s era as they do now. There was nothing like the transnational corporation who generates more revenue than a small nation. I find that particularly interesting because the most powerful force of the time, back in Machivelli’s day, was the government. Now, it is business  and the government.  Although Machiavelli had originally intended for his writings to be applied to government, they can now be applied to business too. Machiavelli generally understood the nature of power, and the way in which one must work with the people in order to succeed.

  1. Jeff Safenowitz permalink
    October 4, 2010 8:15 PM

    With regards to an employer, you debate the question “Is it better to be feared than loved?”. The ideal working environment is when their is a mutual respect between employer and employee. If an employer is too stern, and feared, then the employee is more hesitant to take risks and succeed. On the contrary, if the employer is too nice, and loved, then over time the employee will get lazy and be less efficient. The most successful employers find the perfect balance between being feared and loved, thus propelling their business or company towards success.

  2. Olivia Jung permalink
    October 4, 2010 11:27 PM

    I believe that Machiavelli’s theory can be not only applied to the business world but to everyday life. From one’s perspective, there is always going to be someone in charge and there will always going to be the followers. For example running a functional household is very similar to running a successful business. The CEO of a company, who has to make sure all of his/her workers are following the rules, is like a mother, who makes sure her children and husband does his/her own respectful duties. But I believe Machiavelli’s theory comes down to the fact of whether one should be a fox or a lion. To have order in a household, business or any type of organization one must be feared by others like a lion but also sly like a fox to have everyone’s trust. “A prince must imitate the fox and the lion, for the lion cannot protect himself from traps, and the fox cannot defend himself from wolves. One must therefore be a fox to recognize traps, and a lion to frighten wolves…a prudent ruler ought not to keep faith when by so doing it would be against his interest…”

  3. nikhilsj permalink
    October 6, 2010 1:33 AM

    Perhaps in the past what you have posted may have had some truth to it, but nowadays I feel that business culture is not Machiavellian at all. Corporate Social Responsibility is a huge part of the success of most of the top companies. Many of your statements are not based on fact at all. Some statements I would directly like to argue against:

    “How many company owners got anywhere by being nice and trying to be generous to all their employees. Perhaps there are few, but close to none.”

    Well that is not necessarily true. Up to 90% of the fortune 500 companies engage in some form of CSR. (—for-innovative-companies-it-leads-to-better-financial-performance.aspx?sub=11) That is definitely not “close to none”. It helps build a customer base, as more and more customers are starting to prefer to buy from companies that are socially responsible.

    “These moves are not done for short term gain, but for the long term benefit of the establishment”

    Actually quite the opposite is true. Laying off workers and cutting wages has short term benefits of lowering costs but in the long term it directly affects the remaining employees’ morales and motivation. According to Maslow’s Hierarchy of needs without job security higher levels in the pyramid, such as self actualisation, cannot be reached so employee motivation falls.

    “In business, the end result, or the bottom line, justifies the means.”

    Perhaps for the business itself. Maybe if we stretch it to some of the majority shareholders. Think about it this way though: When Health South Corp. declared its earnings to be 2.5 billion dollars more that the actual value, they probably managed to attract more shareholders and plough back money into their business. Does that really justify their means though? Plus due to the stringent laws in place and the severe repercussions of using the wrong “means” most businesses would seldom stray from doing the right thing.

    “It is better to be feared than loved.”

    Really depends on the kind of business. This is a large debate and different businesses have different styles of running. F W Taylor may have agreed with you but Herzberg certainly wouldn’t. If it was better to be feared then companies like Google wouldn’t be spending millions of dollars a year to keep their staff happy.

    This covers just the gist of my argument. Yes, some of your points do hold true at certain points of time, but most of the time they don’t, especially nowadays.

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