Whose Money Is It?

Paraphrasing the renowned economist Milton Friedman, “people become especially generous with other people’s money.” Politicians do it, business people do it too!

From my point-of-view, professionals don’t play fast and loose with other people’s money – especially when they’re in a position to benefit personally from it.

Consider the employee who lives high-on-the-hog on the company dime. For example, choosing the Conde’ Nast featured restaurant with the $75 steaks while on a business trip. Or the consultant staying at the big-name Four-Star hotel with the 1,000 thread-count sheets? Would they make the same generous choices if it were their own money?…or would they make a different choice?

I realize that there are many instances in which the more generous choice (as a practical matter) makes great business sense—especially when it involves clients. Management is sometimes even couraging of such generosity. Sometimes it’s a way to reward employees. And sometimes there really isn’t a great (or appropriate) alternative to a more expensive option. Yet, these instances are far more the exception than the rule.

How many times have you heard someone boasting of staying at a prestigious Four Star Hotel while on business when the hotels they stayed at for their own vacation (and paid for with their own money) was consistently Three Stars (or less)? Inconsistencies of this type can be precursors to having others lose confidence in us.

Organizations expect people to act responsibly. It’s a sign of maturity and professionalism to treat other’s money like our own. It builds trustworthiness and one’s own self-esteem at the same time.  Granted, some may consider this example insignificant, but it’s one that can portent bigger, even more important, things.