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Comment: Keep it real in business and in life


Guest writer Ronnie Smith tells the tale of two men who believed they were something they were not – one, an all mighty king, and the other one, a smart investor making quick returns, a mistake many Romanian politicians and business people make.

I recently visited good friends of mine in Munich and was very lucky to be taken to see the incredible Neuschwanstein castle at Schwangau. No wonder Disney modeled their fantasy Sleeping Beauty castle on this one as the beauty of the building, in its fabulous mountain setting, is genuinely breathtaking. The Neuschwanstein castle was built by Ludwig II, King of Bavaria (in picture) from 1864 until 1886 for his personal use and in homage to Richard Wagner and the Germanic legends that he turned into musical epics. It is the ultimate statement of every kind of romantic style imaginable.

However, there is a very sad story attached to the idyll because Ludwig died in suspicious circumstances; his body found, with that of his doctor, drowned in nearby Lake Starnberg. The feeling is that his behavior became increasingly erratic and that the government of Bavaria probably ran more smoothly once the King had gone. Certainly visible in the extravagant design and decoration of Neuschwanstein castle are clear signs of instability and although Ludwig paid for everything from his own fortune, he strongly believed that his authority as King was divine and absolute and he behaved accordingly.

Unfortunately Ludwig’s delusions of medieval absolutism did not sit well in the late 19th century constitutional monarchy that Bavaria had become and his death was what we might call ‘well-timed’. Bavaria is now one of the most economically successful regions in Europe and it is no accident that Munich airport is named after Herr Franz Josef Strauss, the late Minister President of the State of Bavaria and a politician who fought extremely hard for Bavarian interests in the growing and changing Federal Republic of Germany. Unlike Ludwig II, Herr Strauss kept himself firmly within the realms of political, financial and business reality and greatly helped Bavaria become the powerful economic entity it is today.

A friend of mine once owned a small company offering services to the international market. He employed fifty people and established a very solid and profitable business. When the moment came to make investment decisions using those profits, my friend followed advice from someone whose focus was on making quick financial returns. As a result my friend invested his profits into new start-up companies in the UK, rather than in his own business. His idea was to make more money quickly from young companies who would grow quickly over a two year period. Any investment in his own business, to improve equipment and service delivery, would not show such a quick return. In the longer term he felt he could eventually invest some of the new profits in his own company but he didn’t regard this as being urgent.

Unfortunately for my friend, the financial crisis arrived and wiped out demand for the new products being offered by the start-ups in which he had invested. As a result, he received no return on his investments.

At the same time, the crisis created huge changes in the markets in which my friend’s own business operated and because he had not invested in upgrading his company it was unable to meet the new challenges and keep up with more focused competitors. My friend recently sold his company to a US group for a fraction of the price that it was once worth.

He had fallen into the same trap as King Ludwig II of Bavaria, believing himself to be something he was not – a smart investor in search of quick and exciting returns rather than a business man running his own company successfully in an unstable and changing market.

The moral is clear and in business it is a very important one. Focus on the actual business you are in and where your solid profit-making base is. Try not to be distracted by the excitement of quick returns in a more risky environment. Be like Herr Strauss and not King Ludwig II and keep your feet on the ground and your life and business real.

By Ronnie Smith, Guest Writer 

(photo source: neuschwanstein.de)

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