Michael Porter’s Competitive Firm Became Bankrupted

The Monitor Group, the consulting firm founded by the business guru, Michael Porter became bankrupted in November 2012. Monitor was unable to pay its bills and was forced to file for bankruptcy protection. I think it is a good development.

Competitiveness championed by Michael Porter has been the prevailing ideology of today’s business and economic policy. Companies, regions, and national economies seek to improve their productivity and gain competitive advantage. But these efforts often produce negative effects on various stakeholders at home and abroad. Competitiveness involves self-interest and aggressivity and produces monetary results at the expense of nature, society and future generations. Competitiveness is a self-serving ideology employed by mainstream business to pursue its profit at the expense of nature, society and future generations. This ideology requires a fundamental correction to enable companies to develop sustainable and responsible ways of doing business.

Competition could be a very useful tool if it supported and fostered broad and shared innovation and emulation processes. But when the only purpose of our socioeconomic systems is to engage in a Darwinian “struggle for life” on a global scale, it results in a disruptive and global war among companies, affecting also the overall well-being of regions, nations and cities.

Competitiveness is not the answer to our needs for a sustainable pattern of development.  Instead of financial globalization carried on by firms and economic interests focused on short-term gains, a cooperative approach is requested to provide a new, effective and efficient way of global governance.  A more collaborative approach is needed where business tries to balance environmental, social and monetary values in innovative ways and makes positive contributions to all stakeholders.