Protecting Intellectual Property and Stakeholder Theory Which is Right

Intellectual Property

A for-profit corporation has to protect its intellectual property (IP) needs if it wants to stay competitive. At the same time, it should understand the needs of its customers, who are more likely to be interested in the product itself rather than in who controls the IP. Thus, corporations have a question to ask: how should they guide themselves? Should they use a shareholder theory approach or a stakeholder theory approach? Who should control the IP, and why does it matter? In a world where brand is everything and brand equity is all that matters for controlling a market, companies seek to keep tight control over their IP because it prevents their brand from souring with consumers when they essentially control the flow of innovative goods that come to market. The fact is that there can be no fair balance between customer needs and business needs in a society that allows corporations to essentially become like nation-states. The problems of IP are but relatively small when compared to the much bigger problem of how companies exploit, undermine, and trivialize society by putting profits before people. The best way to approach this situation would be for companies to begin to put people before profits (Morrin, 2000).

Companies whose mission is primarily to create products on which lives depend should have a greater responsibility to tip the balance toward the customer more than toward themselves, as that is what is meant by putting people first. In fact, when companies put people first, the profits that they ultimately want tend to follow (Gibson & Blackwell, 1999). The fact that Herb Kelleher was able to turn Southwest Airlines from an upstart to a competitive force is based on that fact: he put people before profits and the people, recognizing his good will, gave him their business out of gratitude and respect and appreciation.

Companies that want to deliver life-saving products like in the health care industry should keep Kelleher’s business model in mind. There is no reason drugs should be so expensive. They are cheap in other nations compared to the US. The problem is that the US government subsidizes the industry, and thus the prices are raised (Neuman et al., 2007).

If I was running such a company and looking through a Biblical worldview I would first have to challenge the system as it is: the market is dominated by monopolists who have powerful supporters in government. They have lobbies that work with legislators who create rules and laws that favor their monopoly (Givel, 2006). I would have to realize that I myself do not have the power to change that system. What I would have the power to do would be to put people before profits. By using the Kelleher approach to business, I could offer products that people need at prices that they can afford, and I would thus win the hearts and minds of the consumer. The key to building brand equity with consumers is to get them to fall in love with what one has to offer. People fell in love with Southwest because the flights were fun, fast and cheap. The workers loved their jobs because they had a boss who showed them that he loved and cared for them. The workers passed this enthusiasm on and the company was successful (Gibson & Blackwell, 1999).

Today, unfortunately, markets are driven by companies that seek profits first and that do not mind exploiting workers whether those workers are in Asia or in US prisons, where inmates are paid pennies on the dollar to work for American corporations in what is effectively a new form of slavery. The companies of today are not interested in people: they are interested in control: they seek to control what was once a free market. By commanding the market, they do not have to worry about pleasing anyone. The people have no choice but to buy—even when they do not want what is being sold. Companies engage in manufactured obsolescence, the practice of making products that are designed to break down after a certain time period so that people will come back to buy more products. The consumer is viewed inhumanely.

Companies can profit on their investments by putting people first—it is that simple. One of the two great commandments of Christ was to love one’s neighbor. By loving one’s neighbor, one shows his love for God. Christ said: “Seek ye first the kingdom of God, and his righteousness; and all these things shall be added unto you” (Matthew 6:33). If companies would just show that they love their consumers and thus love God, they would not have to worry about a return on investment because—as God has promised—the good things come to those who please God. It is not a matter of having to ensure that profits come and that one gets one’s ROI. God will take care of it. The important thing for a company to do is to show the love to those who are in need. The whole point of market research, after all, is to identify what consumers need and then find a way to satisfy that need. Serving the consumer is what being in business is all about.

The company will thrive so long as its leaders show that kind of spirit and trust in God for support. Legalism and laws to protect IP are ways to control and bastardize a market. They are not for faithful Christians. Patients, practitioners and companies that rely on health care products, for example—they need the tools, drugs, and designs that companies develop. Why try to prevent them from obtaining these products? What is the service shown to God in that? The secret to being a successful company in this day and age is to show God that you care about His people and to seek first His kingdom, because He is waiting to support those who do so. The secret to Kelleher’s success was found in that principle: show the people the love, and the profits will come because that is the way to God’s own heart.