THOSE WHO TELL STORIES RULE SOCIETY (& Business)
- CINTA & Co.
- Jun 29, 2021
- 3 min read
Updated: Jul 5, 2021
Who creates wealth in our world? And how do we decide the value of what they do? At the heart of today's financial and economic turbulence is a problem hiding in plain sight.
In modern capitalism, value extraction is rewarded more highly than value-creation when value creation is the productive process that drives a healthy economy and society. We consume narratives ranging from companies driven solely to maximize shareholder value; to ridiculously high prices of medicines justified through big pharma's 'value pricing. We misidentify taking with making and have lost sight of what value means. Once a central plank of economic thought, this concept of value - what it is, why it matters to us - is simply no longer discussed.
Mariana Mazzucato argues that the current condition is a reflection of a narrative that was accepted by many. In Mariana's book, "The Value of Everything," she says that if we want to replace the existing economic system with one that is more sustainable. The first thing we have to do is confront the false narrative that exists and construct a new one.
In her book, she says:
"stories are everywhere. The contexts may differ–finance, big pharma or big tech–but the self‐descriptions are similar:
I am a particularly productive member of the economy. My activities create wealth. I take significant 'risks,' and so I deserve a higher income than people who benefit from the spillovers of this activity."
One short key point from Mariam on the financial market to prove this point and quickly allude to Elong Musk and Tesla - 800 billion and their vehicles are not the best quality. They don't produce the most or the fastest.
Tesla's most recent price bump was fueled in part by a leaked internal memo from Tesla's CEO, Elon Musk, urging the company's staff to go "all-out" on bringing electric semi-trucks to the global market at scale.
It's time to go all out and bring the Tesla Semi to volume production.
– Elon Musk
Of course, Musk's enthusiasm for semi-trucks isn't coming from anywhere. Another company, Nikola (also named after famed inventor Nikola Tesla), is focused on electrifying the two million or so semi-trucks in the U.S. market.
Although Nikola has yet to produce a vehicle, its market cap has surged to $24 billion, putting its valuation nearly on par with Ford. Much like Tesla, the company already has preorders from major companies looking to add electric-powered trucks to their delivery fleets.
For major brands looking to hit ESG targets, zero-emission heavy-duty trucks is an easy solution, mainly if the vehicles also live up to claims of being cheaper over the vehicle's lifecycle. The big question is, which automaker will capitalize on this mega-market first?
The moral of the story is, if you want to dominate a market, create social impact, or bring an innovative solution to the marketplace, you have to draft a compelling narrative. Narratives are required because people are nosy. It is in our nature to tell stories and inform others of our life events. Storytelling, whether factual or fictional, is an intrinsic human characteristic.
If you work for a non-profit, sports & recreation, health & wellness organization or an entrepreneur. You qualify for some free content from CINTA Learning Labs that will provide you with a description and explanation of the key components to a compelling business model narrative. Help you better conceptualize the components of your organization's business model. Give you a fresh perspective on your business value-creating activities.
References:
Mariana Mazzucato : Mariana Mazzucato. https://marianamazzucato.com/books/the-value-of-everything/
Tesla is the World’s Most Valuable Automaker – Options Edge. https://theoptionsedge.com/2020/06/16/tesla-is-the-worlds-most-valuable-automaker/
Tesla is Now the World's Most Valuable Automaker - Visual .... https://www.visualcapitalist.com/tesla-is-now-the-worlds-most-valuable-automaker/
Commentaires