Conscious capitalism : A tourism industry perspective

On 24 February, this year we saw the tragic deaths of two French tourists after being hit by a boat in the Belle Mare lagoon. Less than three weeks later, another incident near l’île Plate caused the death of another French tourist. Comments poured on radio and online after these accidents, skippers  have been accused of being ‘savages’ and ‘unconscious’ people and fingers have been pointed at the authorities for their perceived laxity. But the common thread among the comments was this has been coming for a long time. I am not going to study these cases in this article, but I am trying to explore the deeper reason why they happened. Sadly, a number of things that happen in this world have their causes connected to money and these cases are no exceptions. Our tourism industry has become like a giant supermarket where everybody is flocking to find shelf space for their products. As spaces are limited and clients are dwindling, service providers are cutting corners to stay  profitable and hence increasing the likelihood of accidents.   

I am an accountant by profession and I am absolutely not against the concept of people trying to make money – I am not anti-profit. Au contraire, I advise my clients on how to make money – but I also urge them to pay their fair share of taxes. This is because I firmly believe that enterprises are totally capable of meeting the imperative of making profits and at the same time be a good corporate citizen. So, I was absolutely thrilled to discover this paper by John Mackey – CEO of Whole Foods Markets: “Conscious Capitalism – creating a new paradigm for Business.”

Firstly, I am going to summarise the part of the Mackey paper that deals with the philosophical underpinning of the concept. Secondly, I am going to explore how we can apply the concept of conscious capitalism to our tourism industry with the measures announced in Government Programme 2015-2019 in the backdrop. I suggest that we use the conscious capitalism concept to define the purpose of the Mauritian tourism industry – the first step towards devising a more detailed strategic plan to make the industry sustainable and more responsible. Obviously, that will not prevent accidents from happening but at least it can reduce their likelihood. Rarely will a conscious driver or skipper make an accident.

Conscious Capitalism – an overview

According to Mackey, the classical economist view that the purpose of business is solely the transformation of factors of production into profit for the investors is outdated. Whilst acknowledging that businesses will not survive in the longer term if providers of capital are not rewarded with some acceptable level of profit, businesses have purposes that are grounded in the core beliefs of the entrepreneurs who initially founded them. Philosophical ideals provide the seed from which business purposes germinate and eventually culminate into mature enterprises.

The Good corporation is the one that devotes itself to provide a certain level or kind of service to consumers. Whole Foods Market achieves its purpose by “selling the highest quality natural and organic products available, satisfying and delighting our customers, supporting team members happiness and excellence, creating wealth, profits and growth, and caring about our communities and environment.”

The True corporation is animated by the excitement “to discover what no one has ever discovered before”. Google has dedicated astronomic funds to ground breaking projects like Elevators to Space, Google X, new drugs and so on.

The Beautiful corporation expresses itself by providing consumers with excellent products that makes life “more enjoyable”. Apple’s phenomenal rise has been on the back of appealing, easy to use and beautiful products that sell themselves with relatively low advertising.

The Heroic corporation seeks to change the world by accomplishing herculean tasks that could seem impossible and very risky. The Grameen Bank helps millions of poor people by availing microloans. Henry Ford changed the world of automobile by mass producing cars to make them affordable. 

With the exception of the Grameen Bank which is a not-for-profit organisation, all the other corporate examples in illustration 1 have to satisfy the profit criterion so as to be able to reward their investors. These corporations are able to meet the purpose of their entrepreneurs and at the same time make profits by applying this logic: the best to way maximise long-term profitability is by not directly aiming at it. 

The rest of the Mackey paper is also interesting to read but focuses on the application of the conscious capitalism concept to Whole Foods Market Inc. I invite you to read the full Mackey paper in your own time while I turn my attention to applying the concept to our tourism industry.

Applying Conscious Capitalism to our  tourism industry

Many commentators before me have complained about the lack of coherence in the promotion of our destination. We have seen in the past years a branding exercise – Mauritius : c’est un plaisir – nipped in the bud. Later, the announcement of 2 million tourists by 2015 and its quick back pedal soon after. More recently, we have heard yet more announcements on the broadening our tourism product portfolio with eco-tourism, medical tourism, shopping  tourism, wellness tourism, cultural and heritage tourism and grey tourism. My concern with this strategy is that Mauritius can never be among the market leaders in any of the aforementioned products and it will be an uphill battle to favorably position Mauritius in those product markets. Even if we do achieve high growth rate on the back of that strategy it will have the perverse effect of diluting our current specific product offering and it will only be short term. I believe we should maintain the specific characteristics of our product as opposed to commoditising it. Seeking high short term growth will only cause overcrowding of beaches and all other tourist facilities. Overcrowding will lead to poor quality service and sadly more fatal accidents involving tourists that will eventually harm our reputation as an exclusive holiday destination.  Hence, my proposal is to use the concept of conscious capitalism to define the purpose of our tourism industry such that it can be sustainable and coherent now and in the very long run.

The very first point to appreciate is that I am applying the concept to an industry rather than a corporation. I believe that we need a unified entity to gather all stakeholders under one message, one strategy and a unitary business purpose. We need a business purpose that is broad enough to encapsulate all parties involved and concise enough to be meaningful. The business purpose should then be elaborated further to develop a set of core values, the mission and a long term strategy for the tourism industry. The second point to note is that my analysis is only restricted to the business purpose and not a fully elaborate strategy. I humbly hope that my article will elicit some ideas for our business leaders in tourism who are better positioned for more detailed analysis. The few details provided on the Vision and Core Value Propositions serve the purpose of illustrating the concept.  

Philosophical ideal, business purpose and vision

The Good is the most appropriate philosophical ideal that the Mauritian tourism industry should strive for and consequently ‘Service to Others’ its business expression. The proposed vision aspires to offer a unique experience to our guests as opposed to copying the business models of other destinations. The Vision is an embodiment of the core value propositions of our destination which in turn reinforces the business purpose.

The Vision:

“Offering our guests a cosy and comfortable get away, pampered by the Indian Ocean and the genuine hospitality of our people”

Get away

There is a category of tourists that goes on holiday to temporarily get away from their daily hectic life. They just want to go to a quiet place with their loved ones for quality family time or a romantic escapade. This category of tourist is “cash rich, time poor”; they are looking to reward themselves for their hard work and is from diverse locations and age groups. Our tourism offer is will adapted for this category of tourists.

Hospitality of our people

The smile of our people and our kindness towards the foreigner is genuine; they comfort the tourist during his stay. This genuine sense of hospitality is one of our most precious assets that must be preserved. The rapid development of our country, the increased purchasing power of our people, the perception of unequal distribution of wealth and many other socio-economic factors are depleting this much prized asset. The concept of conscious capitalism advocates an equitable distribution of the wealth created by enterprises among employees, owners and entrepreneurs. That would correct the perceived or actual inequality and bring serenity and happiness among all stakeholders. A genuine smile can only come from a fairly rewarded and happy person.

High quality

Mauritius holds the coveted reputation of being a high quality exclusive destination. This reputation has been built over the industry’s long history.  We still hold the key for maintaining this reputation; we must have the will and courage to stand by this reputation. Selling off the destination for short term growth can be detrimental in two ways. First, we may enter a spiral of price cuts such that we may never restore our normal high prices. Secondly, reducing prices would most probably be synonymous to cutting back on services or service quality to stay within costs. This is dangerous as our guests expectations are high because of our reputation.  Under delivering on quality will have long  term negative impact on our tourism industry.

Conscious Capitalism: myth or reality

Some readers may not agree that consciousness and capitalism can work together, or it’s just a management fad or an irreconcilable oxymoron. It maybe a new concept but it is surely making its way into reality. Starbucks, the international coffee chain, recently announced plans to ditch accounting measures that allowed them not paying taxes in the UK. Dunkin’ Donuts stopped using a potentially harmful whitening additive in its products. The two corporations bowed down to consumer pressure and sacrificed short term profits to reputation. Similarly, we should not outrageously squeeze our tourism industry for immediate profit; but rather we should build a long lasting industry that is grounded in our values. To end I leave you with this quote from late Cardinal Jean Margéot: «Nos visiteurs ne sont pas, d’abord, des portefeuilles à exploiter ni des moutons à tondre mais des personnes humaines à rencontrer, à accueillir, à apprécier.»