> Current Issues > Business Ethics

But Will Good Character Pay My Bills?

October 15, 2009 | by Howard Jonas

My character was built in a hot dog stand.

On July 23, 1970, I pushed a makeshift hot dog stand to a street corner in the Bronx, in front of the Van Etten Hospital and across from a bar called the Tender Trap.

It’s a shame that so many young people don’t work. Instead they mooch off their parents, go to school, hang out, and consume indiscriminately, all the while finding time to criticize everyone else. We’re all born naturally selfish. Only by enduring and overcoming life’s hard knocks do we build our characters and become empathetic to other people’s struggles. Working for a living forces us to learn to cooperate and to treat people right. Years ago, almost every young person had to work on the family farm, in the family store, or in some other job in order to make a necessary contribution to the family’s survival. The character of previous generations was built from this sense of responsibility instilled from an early age.

Only by enduring and overcoming life’s hard knocks do we build our characters and become empathetic to other people’s struggles.

What builds the character of youth today? Watching TV? Belonging to a gang? Playing on the high school golf team?

My character was built in a hot dog stand.

On Sunday mornings, the bar across the street was in a shambles. An elderly couple arrived early in a beat-up Dodge sedan to clean the place up. This was a big problem for me. I had a deal with the usual bartenders to supply me with ice during the week, and ice was the magical substance that fueled my business.

The secret to selling hot dogs is selling twice as many sodas. On every 25-cent can of soda, I made 15 cents, whereas on every twenty-five-cent frank I only made a dime. The hotter the summer day, the more I made, and in New York City, summer gets pretty sweaty. If the old couple refused to give me free ice, my profits would plummet. So I walked into the bar on my first Sunday prepared to negotiate, but when the old lady looked up from her mop, she just smiled and said, “Oh, you’re the nice young man with the hot dog cart. Of course you can have ice; you can have whatever you like.”

After that, we became friends. I offered her and her husband free hot dogs, but they were on a no-salt diet. I had started selling flowers, though (to the hospital visitors), so every Sunday when the old couple showed up, I crossed the street to get my ice, and brought the old lady the nicest rose I could find.

One Sunday morning, my hot dog, soda, and flower business came crashing down around me. Another vendor with a huge mechanized stand showed up with his 24-year-old son to steal my spot. The vendor’s son informed me that I had 15 minutes to clear out or he’d come over and kick my you-know-what. Then he pulled a switchblade on me and said he’d kill me if I put up a fight.

Now on the one hand, I definitely didn’t want to die. On the other hand, I wasn’t giving up my spot.

I went over to the Tender Trap and asked the old lady to call the cops if she saw anything happening to me. When I went back to my stand, though, the old lady came out behind me, screaming like a banshee. She told the father-son duo that it was my spot and they’d better leave if they knew what was good for them.

Three Cadillacs screeched to a stop in front of our stands. Seven men got out and one of them screamed, “Who insulted my mother?”

The father yelled back that he’d set up shop wherever he wanted, and called the old lady a terrible name. At that she turned around and went back inside the Tender Trap.

A couple of minutes later, three big Cadillacs (one pink and two white) screeched to a stop in front of our stands. Seven enormous men got out of the cars, and one of them charged the vendor screaming, “Who insulted my mother?” The vendor’s son suddenly lost his bravado.

“Johnny,” he pleaded, “I swear I didn’t know she was your mother.”

The old lady’s son pummeled the younger man with two of his friends trying to restrain him.

“Calm down, Johnny. You don’t want to kill the guy.”

When Johnny finally calmed down, he told my competitors that if they brought their stand anywhere near my spot again, it would be the last day they ever sold hot dogs. He then took a baseball bat out of his trunk and bashed the chrome on their stand about eight or nine times to make sure they got the message. After that, I never saw them, or any other competitor, again.

When the other vendor took off, Johnny and his associates ordered hot dogs like they hadn’t eaten for days. I assumed the dogs were on the house, fair compensation for services rendered, but Johnny not only insisted on paying, he gave me a 20 dollar tip as well. When I refused, he told me it was for the flowers, and that “anyone who’s a friend of my mother is a friend of mine, and I don’t take no money from friends...”

Becoming friends with the old lady was probably the best business move I had ever made at that point in my blossoming career. But why exactly had I befriended her? Part of it was just that I needed to make sure I had a steady supply of ice. But more than that, I felt empathy for her and her husband. As I sat at my hot dog stand and watched them get out of their beat-up car to clean a filthy bar on the morning after a Saturday night rager, I could imagine myself in their shoes. They weren’t rich, and it was obviously difficult to get up early in the morning, especially at their age, to clean out a bar. But they were independent. They worked hard and did the best they could, and I admired and respected them for that. Even at fourteen I realized that things don’t always work out the way people intend – illness, business setbacks, bankruptcy, war, prison. You just never know.

In life, luck counts for a lot. I realized that I could be in their position in 50 years. This double awareness – that people should be judged on how much they do with what they’re given, and not just on how much they accomplish; and also that given slightly altered circumstances, most other people in the world and I could easily have our roles reversed – has instilled in me a deep sense of humility.

Humility is the most important to develop if you want to succeed in business.

Success in business, I think, comes as the result of a combination of many different factors, most of which can’t be controlled. Talent and luck, for example, are God-given. Who knew Johnny would come to my rescue in his pink Caddy? The good news, however, is that good character, which is at least as essential, if not more so, to founding and running a major company, can be developed. Persistence, courage, patience, empathy, loyalty, honesty, integrity, kindness, generosity, the ability to cooperate with others – these can all be worked on and cultivated. Eventually most people, as they get older and work in the productive sphere, develop, out of necessity, into relatively decent people. Obviously it is a tremendous advantage, though, to form a good character and learn these values early on.

Of all these good character traits, though, humility is far and away the most important to develop if you want to succeed in business in a major way. Humility, that good character trait that saved my hot dog stand, serves me equally well as the CEO of a multibillion-dollar telecom company. Developing a sense of humility in my teens has literally made and saved me millions of dollars. Here’s how...

In college, I ran one of the nation’s most successful mail order businesses. At that time, a lot of mail-order marketers were making big money selling small samples of well-known perfumes. I realized that the women ordering the samples had yet to commit to a single brand, and I also knew from my other businesses that people always wanted personalized products that were especially designed and made just for them. I hit upon what I thought was a brilliant idea: perfume personalized for your personality. Women would fill in a whole page of questions about their age, weight, favorite colors, dreams, pastimes, education, clothing preferences, etc...and we’d send them the perfect scent in the mail a few weeks later.

I even invented a fictional Italian perfumer, Giuseppe La- Verde, whom we featured in our ads as personally supervising the blending process for each fragrance. I was so enthralled with the idea, and the genius of my ads, that I could barely think of anything else. Estee Lauder, Charles Revlon, and Nina Ricci would soon be nothing compared to me.

Usually, when introducing a new product to the market, I ran a sample ad in a small publication before ordering any merchandise or placing a large advertising buy. This time, though, I was so sure of myself, and so anxious to launch my takeover of the cosmetics industry that I threw caution to the wind. I hired an expert fragrance chemist to formulate dozens of Giuseppe LaVerde perfumes so they would be ready when the orders came pouring in. I stocked my storeroom with cases and cases of the different perfume varieties. I spent $10,000 on a full-page ad in the National Enquirer, and sat back waiting to become rich beyond my wildest imagination.

But even my wildest imagination could not have conceived of the number of letters that would gush in for Giuseppe La- Verde. One. One single, thirty-three-year-old, green-eyed badminton enthusiast from Iowa filled out the survey and ordered her specially mixed scent. One! Giuseppe LaVerde had cost me over $25,000!

What Giuseppe and young Howard didn’t yet know was that a woman wears perfume to be Lauren Hutton, Elle McPherson, or Coco Chanel, not to be herself – an overweight, middle-aged librarian with a degree from a junior college. How could I have been so stupid? What grandiosity! What recklessness! Mea culpa, mea culpa, mea culpa!

Eventually I learned my lesson, and I never ran an ad campaign again without testing it first. The rule has held true in every business I’ve been a part of since. Many times I’ve found that things I thought were sure bets weren’t sure at all. When people are on a winning streak and think they’re right, they often feel the need to put their money where their mouths are. You see this in Vegas whenever someone lets it all ride on black, or some quiet employee loses thirty years of savings on a risky investment. This kind of risk taking is pure hubris. There’s always a way to test first, to gather information, to scope out competition, and generally to hedge the bet. Many of the most successful people in the business world seem to be big gamblers, but I promise you, they’re never making bets that aren’t well hedged.

A businessman has to know he’s fallible, that he’s a human being who can and will make mistakes. Only a humble man has the discipline to avoid disaster by cutting his losses when he realizes he made a mistake. And only a humble man will really abide, year after year, by the business world’s three most important rules: test, test, test.

Humility is also the key trait to possess if you want to inspire the people who work with you to put the full force of their hearts, souls, and creativity into your business.

When you realize that only a hair’s breadth separates society’s successes from its spectacular failures, and you see that being on top now in no way guarantees that you won’t find yourself at the bottom in the future, you will probably want to help people who are less fortunate. If the roles were reversed, you’d want them to do the same for you. The irony is that charitability, which comes from humility, can have an extremely beneficial impact on the bottom line.

I started to give a lot of my income to charity in high school. At just that time, I became interested in my Jewish roots and discovered that the Jewish sages advise a person to give away between ten and twenty percent of his after-tax earnings. Twenty percent is the maximum because giving away more could endanger a person’s financial stability, which would be bad for society as a whole. I therefore decided to try to give around twenty percent of my income to charity each year. It’s hard to begin to relate how rewarding this decision has been.

First off, my charitable donations lift my self-image in ways nothing else can. Imagine how rich you feel when you can sit down and think about the truly needy people in the world, decide which ones you most want to help, and then send them a check that helps alleviate their suffering. I can tell you from experience that it makes you feel like a millionaire. It’s just impossible to feel poor when you’re giving away money. Charity also renders any luxury items you’re “lacking” grossly unimportant. This is just as true when you live hand to mouth as when you live on Easy Street.

Giving money to those in need also keeps you balanced and pointed in the right direction. Instead of feeling envious and unhappy from having your mind focused constantly on people who have more wealth, talent, and accomplishments than you, you feel grateful and satisfied because of your awareness of those who have less. But most importantly, the tremendous sense of satisfaction that comes with supporting worthwhile organizations and charities motivates people who give to work hard, succeed, and earn more so they can give more.

People who come to work every morning in order to accomplish something noble, wind up elevating their whole existence.

When you think about it, doesn’t it seem empty to channel all your creative powers into the pursuit of a Lexus? To me, it seems nuts. If amassing material possessions is truly the end goal of all the hard work, then maybe it would be better to stay home and read a good book. On the other hand, the people who come to work every morning in order to accomplish something noble, or to make the money needed to support a noble cause, wind up elevating their whole existence. Work is then transformed from a monotonous and mundane task to a spiritually uplifting and even sublime expression of your highest ideals. You don’t just work to satisfy your own selfish desires, but to help others and make the world a better place.

One last thing. By getting involved in charitable organizations, you’ll meet great people who may become your closest friends. Not only that, some of the people you meet will be extremely rich, important, and powerful. These people, who are totally inaccessible if you approach them in a business setting, are happy to talk to you at a charity board meeting. Who knows? One of these people might give you the venture capital money you need to pursue your dream. That’s exactly what happened to me. I’m certainly not saying that you should get involved in these organizations in order to make good business connections.

The only good reason to volunteer and support a charity is if you honestly believe in, and want to promote, their cause. But if the system is set up so that the contacts you make while doing the right thing help you in the business arena as well... well then, who am I to complain?

Excerpted from "Be A Mensch: Why Good Character is the Key to a Life of Happiness, Health, Wealth and Love," edited by Moshe Kaplan, MD, Gefen Publishing House Ltd.

Click here to order your copy, special offer for readers.

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