October 22, 2010

The price of the car

He was around 40 years old. He wanted to expand his business and be one of the main actors in his market. He believed that he could achieve his growth aims by acquiring a strategic partner, who would support him in the company and open up new markets for the business.

By the end of our meeting he started to talk about the cost of consultancy services for acquiring a new partner. He told us that he wanted to work with us as consultants but currently his company could not cover the fee. I explained that the sales of shares in SME’s is a personal issue and is not directly related with the financial situation of the company. In the end he would personally receive the money from the sales of his shares. It was up to him later on to put the money into his company or not. This was a subject to be discussed with his new partner. During my monologue while he was showing his approval by nodding his head, he was also playing with the keys of his car. I certainly knew that the price of his car was some multiples of the amount which he had declared he would have difficulty in paying for consultancy services.

Following my words on who benefits from the sales of his company shares, I asked him whether or not he was pleased with his car. Even before I completed my question, his eyes started to shine. He then told me about the superior features of his car and its various benefits to him, some of which were emotional. I asked him about the price range of such a car and whether he takes care while parking his car. He understood where my questions were leading him but his reaction was quite typical. He said, “Business and private life are two different things”. Then he blushed a bit because he remembered that just some moments ago he had accepted the income from the sales of his company shares to be his private gain.

Our decisions depend on our priorities. Our priorities are determined by our expectations and the benefits to be gained by those expectations. If we believe that the materialistic and emotional benefits of driving our ideal car exceed the benefits to be obtained by investing in the sales of our company shares, then we first make our investment on the car. Even having to leave that investment on the street does not change our decision on this issue. As Mahatma Gandhi said: “Action expresses priorities.”

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