Let´s continue with my own reflections about the first 100 years of the United Fruit Company in Latin America or the 100 years of solitude (as Gabriel García Marquez wrote it perfectly in his book):

• Let´s examine the conducting line of my strategic analysis: the premise of beautiful businesses under Eleonora Escalante Strategy point of view. Ideally, the role of international or multinational corporations (MNC) is to elevate the development of the countries in which they operate. The MNC corporate brains have to shift from a selfish perspective of maximizing their shareholders’ value by using a strategy of low-cost (using the low-cost standards of the developing countries) to an integral strategy of helping to evolve and elevate the standards of living of the places in which they serve.  Once that shift of paradigm is done, the role of the MNC is to help to develop economically and humanly to these countries. Are we on the same page? Let´s continue.
• The daily question for an MNC´s CEO to answer should be: How can I help this country to raise their business standards and institutional ecosystem to provoke the improvement of the quality of life of its population? What good things can I do with the entrance of my business to this foreign land? Can I help my future workers to live with dignity, can I help them and their kids to study and attend universities, can I help them to have a decent home with the basic services as water, energy, made of brick, resistant ceilings, modern WC, tile floors, etc? How can I help the families of my workers to become women and men of God´s faith and impeccable moral values?
• Now that we have established the premise of the mission of MNCs in foreign lands, let´s continue. Follow my reflection ideas please: Multinational corporations have the capacity and the resources to help governments in developing countries to develop ethical institutional and fair trade law structures which can help them to protect not just their economic interests but the interests of every single company operating in that particular nation. (Companies of every size and flavor: big-ticket corporation, international, medium, small or microbusiness) regardless if the companies are local or foreign.
• The case of the United Fruit Company is a beautiful example of some incorrect moves that an international company operating in foreign lands shouldn´t do. Or at least should not try to do.  MNC´s must be aware of their “role modeling” behavior in foreign lands. The following issues must be at the top conscious mind of “role modeling” for international corporations working abroad (not just the UFCo case):

1. Business values away from home: A company must have the same standards of highest levels of moral values, such as integrity, honesty, transparency, ethics in all aspects of the business: with customers, suppliers, employees, government officials, and the society at large.
2. Legally it must comply with the laws of each country and the communities in which operate. On top, it is a duty of the company to improve the legal aspects for countries with incipient capitalism or with embryonic market economy standards. Instead of using the institutional weakness of the country for their own benefit, multinational corporations have to help these “embryonic societies” in their quest to “help them” to control their illegal or unethical behavior before it becomes a normal way of businesses.
3. Doing businesses in corrupt contexts is a challenge. Multinational Corporations are key players to help with the strengthening of effective business ecosystems: particularly the institutional background of business reflected in fair laws for all, enforceable system for contracts and respect of the law, social understandings, standard business practices and the ethical acceptability by the masses. A democracy that functions well, requires an ethical and equitable system.
4. A country where an MNC company promotes or is part of the local problems must review their core values. Urgently. If these problems, such as roots of extortion, physical harm, and threats, robberies, lying, producing defective goods with low-quality inputs, dumping toxic waste,  abusing employees by not improving the quality of life of its workers, destroying the local fauna and flora, promoting coups d’État, or using discrimination as an employment culture policy, etc. It doesn´t matter if the country has or not effective policies. The international corporation must behave correctly with international standards, not by the weak standards of the embryonic democracy.
5. For example in the case of banana producers, if a company perceives its workers as “apes” or non-educated gorillas, of course, they will feed them with bananas. And not just that, they will diminish them or mistreat them as animals. If companies see Latin American workers as monkeys, of course, the employees and the society will revolt, sooner or later.  And they will use unions or civil wars. The MNC must be a flag of peace, by not mistreating the locals as “apes” or non-developed humans.
6. The MNC must be grateful with the foreign land to let it work in their territory, in consequence, if an MNC starts to harm people as animals (gorillas), or slaves, is not just questionable but extremely disrespectful.   Even animals deserve respect, why not humans?. Any worker deserves respect, regardless of his skin color, or appearance, or its lack of education. If the MNC decides to establish abroad, they should help the embryonic democracy to educate themselves, by providing funds for schools and universities, including scholarships. By offering beautiful decent homes (even if tiny) to all their employees. By giving to them as much as the employees produce. Not just in terms of the local wages, but in terms of improving the quality of life of their own workers.
7. The role of the international corporation working abroad must be to help the foreign country for its development with international ethical standards. I already wrote this, but now I wish to share the meaning of this phrase specifically applied to the 100 years of solitude of the United Fruit Company. After 100 years of the UFCo, all its employees should have been living in better conditions than when they found them in 1899. That means 4 generations of families should have emerged from poverty, should have improved its conditions of life. If the UFCo would have done their correct role in Central America, the Caribbean, Colombia and other parts of South America, I am sure our populations would have evolved, in level and quality of life (education, health, wages, home improvement, etc.). But it was not the case.
8. If the United Fruit Company should have done its ethical integral role, I am sure it wouldn´t have attracted their own sorrow. They would not have filed for bankruptcy. Never is never.  I am convinced they would have been key developers of our development, and probably no drug cartels or guerrillas would have appeared in the region either. If the UFCo would have operated with the premise of Eleonora Escalante Strategy, none of the civil wars and conflicts turmoil, including the communist rebellions in El Salvador, Nicaragua, Guatemala, Colombia, and other countries would have ever happened.  The revenge strategy against the UFCo killed our Latin American development.
9. The lack of visionary (long term view) and integral mindset of the UFCo leaders triggered their own slippery consequences. They offered low-cost bananas to America and Britain, at expenses of our 100 years of solitude.

I will stop here. Next week I will post my last episode of the banana wars. I will write about the last banana trade war which appeared at the end of the year 1999. When President Clinton was facing an impeachment trial. This is bonus material. In the meantime, I will leave you watching the following video as a prelude for the strategic analysis, about the whole banana wars experience in Latin America.

Once I finish with the banana wars, we will continue with The Boston Tea Party Conflict (1773). Don´t lose sight, please. It is so crucial to learn the lessons from the past. Our future depends on how well we don´t repeat their mistakes.  Particularly in terms of revenge strategies. Don´t forget it.

Thank you for reading to me. I am so overwhelmed for your eyes on me. Blessings.

“Gorgeous hair is the best revenge”. I. T.

Disclaimer: Illustrations in Watercolor are painted by Eleonora Escalante. All the presentation slides shown on this blog are prepared by Eleonora Escalante. Nevertheless, all the pictures or videos shown on this blog are not mine.  I do not own any of the lovely photos or images posted unless otherwise stated.   

Published by eleonoraescalantestrategy

Corporate Strategy Artist, San Salvador, El Salvador View all posts by eleonoraescalantestrategy