Making a case for a more collaborative form of business

You can probably work out what you will think of the new book, “Standing on the Sun: How the Explosion of Capitalism Abroad Will Change Business Everywhere” by gauging your reaction to this passage on the future of capitalism: “Firms that want to be part of fruitful collaboration will start behaving generously. And as a result, they’ll attract generous partners.”

Naive idealism or visionary insight? If you think it sounds like the former, prepare to be enraged; if the latter, to be enchanted.

Authors Christopher Meyer and Julia Kirby argue that capitalism is being irreversibly changed by forces such as the spread of technology, the shift in economic power to emerging markets and the recent failures of a system that pits self-interested Western companies against each other.

An obsession with a return on equity, shareholder value and “pseudo-competition,” they say, has blinded Westerners to the opportunities available if they adapt to a more innovative, more collaborative form of business.

To understand how the old system is evolving, they suggest, managers must shift their perspective, rather as Copernicus defied dogmatic scholars by putting the sun, rather than the Earth, at the center of the solar system.

Meyer, a founding partner of Monitor Talent, part of the consulting firm Monitor, and Kirby, an editor at large at Harvard Business Review, write with an American accent.

This is understandable. The U.S. represents the most entrenched and, until recently, most successful example of the type of capitalism the authors say will be left behind. But fascinating hybrid businesses are springing from the confusion of fast-growing markets and the authors argue compellingly that those will change the rules of business for the better.

I could have read a little less about the likes of Salesforce.com, AT&T and General Electric and a lot more about organizations such as India’s Dial 1298 for Ambulance (which links a for-profit service to a nonprofit foundation) or Israel’s Shekulo Tov (which sells decorative objects made by mentally disabled people, for whom the work is also therapeutic.)

“Standing on the Sun” will irritate some orthodox economists with its claim that focusing on “gross national happiness” will change the world. It will also annoy some traditionalist executives with its advocacy for a strategy of “shared value” that harnesses companies’ and society’s mutual self-interest.

The book also underestimates the political obstacles to the injection of more socialism into the U.S. market and more market into social services in Europe.

Finally, as the authors state ominously, the greatest resistance to change is likely to come from “the big financial institutions [which] have an interest in keeping the game going.”

But the prospect that innovation, collaboration and social value will take the place of “mutually assured consumption” is attractive. The book makes a strong case that many companies are already heading in that direction.

Sometimes it seems as though the strongest defense of capitalism is the stifling, circular argument that it is the best of a bad set of options.

This book, published by Harvard Business Review Press, is a well-timed, well-written antidote to such post-financial crisis pessimism. By pointing out how capitalism is itself evolving beyond its 20th century bastions, Meyer and Kirby open a window and let in some welcome fresh air.

Andrew Hill is the management editor of the Financial Times of London, in which this review first appeared.